What reshoring means for your portfolio

  What Reshoring Means for Your Portfolio Dear reader, “America First” is a topic that has been at the heart of the upcoming presidential election. It’s a narrative that former president Donald Trump has pushed since before he was first elected into the White House. After the COVID-19 pandemic caused major supply-chain disruptions – which led to inflationary prices and the inability to produce certain goods – the concept of reshoring became appealing. Reshoring (also commonly referred to as onshoring) is the act of bringing the production and manufacturing of goods back to a company’s home country. As you can see in the chart below, reshoring efforts began increasing about a decade ago. But they accelerated during the pandemic and haven’t slowed since. Last week’s preliminary second-quarter Gross Domestic Product (GDP) results back up the above chart – as well as notion that “America First” has become a major investment trend. Nonresidential investment in manufacturing structures increased to the highest percentage of GDP on record. It now makes up 0.854% of the total, which suggests that more of the country’s GDP is being spent on building factories here in the U.S. than it has over the past century. This is a product of reshoring. We can also view this trend through the money being spent on the construction of new manufacturing facilities. The chart below shows a surge in recent years as the reshoring trend has boomed. The trend is clear. So, what does that mean for you and, more importantly, your portfolio? Well, the new facilities being built will likely be cutting edge as some of the money subsidizing this construction is from the CHIPs and Science Act of 2022, which supports an increase in U.S. semiconductor manufacturing. In fact, when I think of reshoring I picture manufacturing facilities that look like clean rooms in a biotech firm – not your traditional dirty manufacturing plant. That means we can expect a large number of higher paying, next-generation manufacturing jobs to be created. Reshoring should also lower the potential supply-chain issues that would arise from events that close borders or raise tariffs. From an investing standpoint, this trend will create layers of opportunities in everything from the engineering and construction industries to building materials, robotics, and artificial intelligence. And it shouldn’t surprise regular readers that I already have several on my watch list… Symbotic (SYM) is a robotics automation company that helps facilitate a better workflow in distribution centers. It has a contract with Walmart (WMT) – which owns about 13% of the smaller robotics firm. AECOM (ACM) is one of the world leaders in design, construction, and engineering management services. It works in a variety of industries and has a presence in more than 150 countries. These are just some of the companies I’m following right now, and I anticipate including at least one in my newest newsletter service that will launch in early August. I’m incredibly excited about this project and can’t wait to give you more details soon. Stay tuned! Here’s to the future, [McCall's Signature] Matt McCall Editor, Market Insights Check Out My Latest Podcast It has been a few days since President Joe Biden’s announcement that he’s dropping out of the 2024 presidential election rocked the world. That has given us some time to think about the implications. So [on this episode of the SteadyTrade Podcast]( Tim Bohen and I share our views of the historic decision. And more importantly, we discuss what it all means for your investments. It looks like it will now be a showdown between former President Trump and Vice President Kamala Harris – although nothing is set in stone. We should expect volatility in the stock market in the near term. But the big question is which sectors will benefit and which will be hurt by the candidates’ potential agendas. [Check out this must-watch podcast to learn more](.   © 2024 Centurion Publishing 13809 Research Blvd, Suite 500, Austin, TX 78750   *Results are not typical. Past performance does not indicate future results. All investing carries risk. Our Privacy Policy, along with our Term & Conditions, governs your use of this site. By using our site, or by accepting the Terms of Use (via opt-in, checkbox, pop-up, or clicking an email link confirming the same), you agree to be bound by our Terms & Conditions and our Privacy Policy. If you have provided personal, billing, or other voluntarily provided information, you may access, review, and make changes to it via instructions found on the Website or by replying to this email. 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