Feeling good about your 26.9% S&P 500 gain this year? Sure, it's great — until you realize you could have gained nearly 4,040% instead by finding truly outstanding stocks.
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Five of the top 10 S&P 500 stocks in December, like health care plays Cerner (CERN) and IBD Long-Term Leader Edwards Lifesciences (EW) plus techs like Broadcom (AVGO), jumped more than 20% just in the month of December, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. That's twice what the .
And that's the point — and just the end of an amazing year. Buying and holding the index worked fine. But for real wealth building this year, it took straying from the pack. What does that mean in dollars and cents? Had you invested $10,000 in January and reinvested your money into the each month this year, including in December, you'd have $413,597 now. Not bad.
Hindsight is 20/20. And clearly, few if any investors could have pulled this off as it's not arepeatable strategy. But the staggering gains are a reminder to investors big gains are possible even in volatile years if you focus on leaders. Meanwhile, had you put $10,000 into the S&P 500, you'd have just $12,690. The S&P 500, lifted recently by value stocks and sectors, is up 26.9% this year.
Solid December For S&P 500 Stocks
Nothing helps the S&P 500 better than a strong finish to the year. And that's exactly what investors got in December. The S&P 500 rocketed 4.4% during a stellar December. That's its third-best month of this year, following other stellar monthly gains. Stocks jumped 6.9% in October and 5.3% in April.
What lit it up in December? Health care. Half of the top 10 S&P 500 stocks during December all hailed from the health care sector.
And Cerner, a provider of health care technology products, is the No. 1 of them all. Shares of the North Kansas City, Mo. company jumped more than 31% just in the month of December. It's the only stock in the S&P 500 to gain more than 30% this December.
But a host of other health care stocks followed closely behind. Edwards leapt nearly 21%, Cigna (CI) rose 20%, DaVita (DVA) rose nearly 20% and Vertex Pharmaceuticals (VRTX) added nearly 18%.
Such huge gains put the whole health care sector on top in December. The Health Care Select Sector SPDR (XLV) jumped more than 8.6% — just in December — third behind real estate and consumer staples as the most of any other S&P 500 sector.
Top S&P 500 Stocks In December 2021
| Company | Symbol | Dec. % gain | Sector |
|---|---|---|---|
| Cerner | (CERN) | 31.8% | Health Care |
| Lamb Weston | (LW) | 22.1 | Consumer Staples |
| Edwards Lifesciences | (EW) | 20.7 | Health Care |
| DaVita | (DVA) | 20.4 | Health Care |
| Broadcom | (AVGO) | 20.2 | Information Technology |
| Cigna | (CI) | 19.7 | Health Care |
| NRG Energy | (NRG) | 19.6 | Utilities |
| Hormel | (CTXS) | 17.9 | Consumer Staples |
| Citrix Systems | (CTXS) | 17.6 | Information Technology |
| Vertex Pharmaceuticals | (VRTX) | 17.5 | Health Care |
Source: S&P Global Market Intelligence
Top S&P 500 Stock Each Month Tell 2021's Story
Standing out from the market was tough this year. By all accounts, the S&P 500 just put up one of its best years in a long time. And the top stocks each month tell the story of a dynamic year.
The S&P 500's nearly 27% jump this year is ninth best since 1950. What's remarkable, too, is how much of a winning streak the market is on. Keep in mind this year's huge gain comes aftera 16.3% rise in 2020 and nearly 29% gain in 2019. The S&P 500 hasn't fallen since skidding a mere 6.2% in 2018. And the results are spectacular. The S&P 500 has more than doubled in just five years.
The results of top stocks each month this year are outstanding, too. It all kicked off in January with the amazing 'meme stock' rally. Discovery (DISCA) jumped nearly 38% in January. And then inflation fears turned energy into the winner in February. Marathon Oil (MRO) leapt more than 50% in February. Inflation, though, has been a theme all year, pushing energy and materials stocks to the top in March and September, too.
And then, renewed Covid-19 fears in July sparked a 50% rise by vaccine maker Moderna (MRNA) in July. Technology made another run in November with Qualcomm (QCOM). And health care ruled in June, July and now December, too.
One thing to point out, though, is no matter how good 2021 is, it's still not like years past. Not once in 2021 did the top stock of the month double, as happened in 2020. In fact, had you invested $10,000 in the month's best stock in 2020, you would have ended up with $1.7 million.
But with gains like we've seen in 2021, don't expect to hear many complaints.
Top Current S&P 500 Stocks Each Month In 2020
| Month | Top S&P 500 stock | Symbol | Stock Monthly % Gain | Sector | S&P 500 % Monthly Ch. | Beg. Bal. | Cumulative Value Of $10,000 Investment In January Reinvested In Top Stock Each Month | Composite Rating |
|---|---|---|---|---|---|---|---|---|
| January | Discovery | (DISCA) | 37.7% | Communication Services | -1.1% | $10,000 | $13,770 | 32 |
| February | Marathon Oil | (MRO) | 53.3 | Energy | 2.6 | $13,770 | $21,109 | 86 |
| March | Nucor | (NUE) | 34.2 | Materials | 4.2 | $21,109 | $28,329 | 97 |
| April | Equifax | (EFX) | 26.6 | Industrials | 5.3 | $28,329 | $35,864 | 84 |
| May | NortonLifeLock | (NLOK) | 28.0 | Information Technology | 0.5 | $35,864 | $45,906 | 82 |
| June | Biogen | (BIIB) | 29.5 | Health Care | 2.2 | $45,906 | $59,449 | 21 |
| July | Moderna | (MRNA) | 50.5 | Health Care | 2.3 | $59,449 | $89,470 | 75 |
| August | Paycom | (PAYC) | 22.2 | Information Technology | 2.9 | $89,470 | $109,333 | 89 |
| September | Coterra Energy | (CTRA) | 36.9 | Energy | -4.8 | $109,333 | $149,676 | 99 |
| October | Enphase Energy | (ENPH) | 54.5 | Information Technology | 6.9 | $149,676 | $231,250 | 99 |
| November | Qualcomm | (QCOM) | 35.7 | Information Technology | -0.8 | $231,250 | $313,806 | 98 |
| December | Cerner | (CERN) | 31.8 | Health Care | 4.4 | $313,806 | $413,597 | 85 |
Source: S&P Global Market Intelligence
Follow Matt Krantz on Twitter@mattkrantz
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