Why this market strategist likes uranium but says gold is out of season

Brooke Thackray is bullish on the markets over the next six months, but not for the same reasons many other market strategists cite.

Mr. Thackray, lead strategist for Global X Seasonal Rotation ETF HAC-T, says it’s a time of year when markets tend to get stronger, driven by sectors such as industrials and materials.

“We’ve just come off the six-month period in which the stock market tends not to do so well,” says the research analyst at Toronto-based Global X Investments Canada Inc.

He notes this year has been an exception, with markets soaring since their plunge in April after U.S. President Donald Trump’s initial Liberation Day tariff announcements, which have since been negotiated lower for many key economic countries.

Mr. Thackray says his seasonal strategy may not work perfectly every year, but describes it as a long-term discipline based on historical market trends.

“There will be times when it doesn’t work, but you can’t deviate from your plan,” he says.

For instance, he says government bonds tend to do well from May to early October, while precious metals tend to outperform between July and early October – both of which happened this year.

Seasonality is the first market screen he looks at, followed by technical analysis that considers factors such as price momentum and fundamentals.

Global X Seasonal Rotation ETF has returned 6 per cent year to date as of Oct. 29, according to Morningstar Canada data. Its one-year return is 4.4 per cent, its three-year annualized return is 11.5 per cent, and its five-year annualized return is 12.5 per cent.

The Globe spoke with Mr. Thackray recently about his seasonal investment approach and the exchange-traded funds (ETFs) he’s been buying and selling.

Name three ETFs you like right now.

This one will be self-serving, but we like Global X Uranium Index ETF HURA-T. The fundamentals in the uranium sector are good. There’s a supply deficit expected to widen amid increased demand for nuclear power, especially as artificial intelligence adoption grows.

On a seasonal basis, the uranium sector tends to do well this time of year. One reason is the World Nuclear Association meets annually in September, and buyers start to do their allocations and increase their purchases after that event. So, it’s a stronger time for the uranium sector until about January.

S&P 500 Industrial Sector SPDR XLI-A is another ETF we’re buying at this time of year. [Some of the top holdings in this ETF include GE Aerospace GE-N, Caterpillar Inc. CAT-N and RTX Corp. RTX-N.] It tends to perform well up until about January.

The industrial sector is a good place to be now, given that the U.S. economy is still doing well and is expected to remain a leader. The ETF also has exposure to international markets, which is a good thing. So, if you expect the U.S. economy to do well and the global economy to do okay, which is what’s happening, then the industrial sector is a good place to be.

S&P 500 Materials Sector SPDR XLB-A is another ETF we’re buying today for largely the same reason as the industrial sector. [Some of the top holdings in this ETF include Linde PLC LIN-Q, Newmont Corp. NGT-T, and Sherwin–Williams Co. SHW-N.]

With the U.S. economy still showing signs of improvement, the sector can do well from here on out. It’s a bit of a value play given how much it has pulled back relative to the market, which has been focused heavily on technology stocks. [The ETF is down about 9 per cent over the past year.]

Name an ETF you sold recently.

Global X Gold Producer Index ETF GLDX-T is an ETF we bought in early August. From a seasonal perspective, the gold sector starts to stumble in late September, so we sold the position at the time. We had a large position in overall precious metals, including silver, which we bought in June. Both sectors did well over that period.

We still like the gold sector long term, but our seasonal mandate requires us to get out. We also exited silver around the same time.

This interview has been edited and condensed.