There's an old saying among traders: "The trend is your friend."
And for a large group of stocks within the index, the trend has been either decidedly positive or negative. Those performance trends stayed mostly intact this month, as stocks exhibited a fair amount of volatility on the heels of an October that saw the best monthly gains in three years.
Some of the best performing stocks in the S&P 500 so far in November are the same ones that have been leading the way higher all year. As of Monday, more than half of the constituents of the index posted positive returns on a month-to-date basis, which might be expected given the S&P's relatively flat overall performance.
However, among that group of stocks, only about 160 have not only exhibited positive November gains, but also held onto positive year-to-date gains. In other words, they are stocks with both shorter and longer term relative upside momentum. Using both of those metrics in combination can help to eliminate stocks that have seen sharp rises over the short term, but due perhaps to a bounce off extremely sold-off conditions. For example, shares of natural gas and coal company Consol Energy have gained 10 percent in November, but are still down 78 percent this year.
The two best performing stocks in the S&P 500 that are so far positive for the month and the year are deal related. Shares of industrial gas company Airgas have gained 44 percent on the heels of a takeover bid by French competitor Air Liquide. The second best performing stock given those parameters is Plum Creek Timber, which agreed to be bought by Weyerhaeuser. The shares rallied 23 percent for the month on a deal that would create America's biggest timber and forest products company.
If those two stocks are excluded, the performance list is topped by a favorite of 2015. Online movie streaming company Netflix shares gained 15 percent this month and are up 156 percent in 2015. Netflix is the best performing stock in the entire S&P 500 on a year-to-date basis. Other top performers on that basis include independent oil refiners like Valero and Tesoro, as well as homebuilder D.R. Horton. The top 10 stocks meeting the positive performance criteria are listed below.
On the flip side, a look at the worst performing stocks in November that also have negative year-to-date performance can help identify stocks where the momentum has been to the downside, and has been so for much of the year. The worst performer on that basis is copper and gold miner Freeport-McMoRan, which has been a victim of the longer term downdraft in commodity prices. Other notable underperformers in November have been retail oriented stocks like Macy's and Urban Outfitters. The 10 biggest laggards using the negative performance criteria are listed below.
There is another part of the stock market where many investors have sought refuge during the course of 2015, and continued to do so in November. Publicly traded companies worth at least $100 billion in market value have generally fared well both short and longer term. There are nine mega cap companies that have posted positive month-to-date performance and have gained at least 20 percent for the year as well. Online retail giant Amazon.com tops the list, gaining 8 percent for the month and more than doubling in value for 2015. The eight others are listed below. (Please note that two shares classes of Google parent company Alphabet are represented.)
Some traders believe there could be continued upside for these larger company's stocks. "I think the megas can continue thanks to all the winds behind indexing and exchange-traded funds," said Dave Lutz, who heads ETF Trading at Jones Trading. "It really feels like the Street remains underweight US equities. … Just going to market weight will continue to increase inflows into index products that buy mega cap stocks."
Of course, the sentiment isn't all positive. There continue to be geopolitical uncertainties, as well as concerns about how markets will react to the possibility of interest rate increases from the Federal Reserve. However, if the trend really is a trader's friend, some of these stocks could continue to see similar momentum to what they've seen over the last few weeks, as well as over the year. One big question is whether or not the trend changes. Another big question is what ends up being the catalyst for altering the current trajectory of the market? A certain population of larger cap stocks has managed to weather a slew of market uncertainties this year.
— Gina Francolla and Chris Hayes contributed to this report.