Some traders think the recent decline in transportation stocks may be poised to bounce back. Airline stocks have benefited from lower oil prices; however, other industries like railroads have lagged broader equity benchmarks. Infrastructure investing could also go up as more governments focus on upgrading old, dangerous bridges, pipelines, and roads.
“Decades ago, it appeared transportation and technology stocks could not be more different, but a correlation between the groups is growing,” said Michael Bapis, partner and managing director at the Bapis Group at HighTower Advisors. “As the connection between companies like Amazon and shipping firms intensifies, transport stocks should be favored for the long haul.”
In light of these movements, ETF Trends posits that the U.S. Global Jets ETF (JETS) is “showing signs of rebound potential.”
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ETF Trends publisher Tom Lydon is on the board of U.S. Global Investors.
The Dow Jones Transportation Average (DJTA) is a price-weighted average of 20 U.S. transportation stocks.
For more information on the iShares Transportation Average ETF (IYT) and ProShares S&P MidCap 400 Dividend Aristocrats ETF (REGL), please see those funds prospectuses.