Anyone even keeping just one eye on the U.S. market would probably know that homebuilders stocks have been on a big tear this year, rocketing higher about 50%.

However, this shouldn’t be a surprise to our readers. Last November 9, I wrote about a curious seasonality to homebuilder (and related equities) called the “Golden 6M.” Indeed, since 1999, homebuilder equities have tended to bottom around October 20 (mean date) and then rally some 19% through April 30 (about 80% of time), outperforming the Standard & Poor’s 500 index by about 1,310 basis points.

The other six months are a bust for this group, with homebuilders falling about an average 4% (though up in 48% of the cases). This has been a winning trade 80% of the time and since 2009, profitable every year except 2015, as this pattern has played out in nine of the last 10 years.

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Given that this year the group has already rallied so hard year to date, with the rally starting on July 23, you might be tempted to say, “Hey, Tom, what about 2019?” Well, despite this, I still think this seasonal “Golden 6M” again will play out.

In 2012, for instance, homebuilders were already up 35% at this point in the year but during that ‘Golden 6M’ they managed to gain another 18%. This was also true in 2...

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