Evercore ISI: The Comeback Play You Might Be Missing

Evercore ISI: Tax-Loss Trades Could Spark a November Comeback

Investors kicked off the week in high spirits, buoyed by optimism over a potential U.S.–China trade deal, strong upcoming tech earnings, a healthy U.S. economy, and expectations that the Federal Reserve will trim interest rates this week. Together, these factors are helping the S&P 500 edge toward its 35th record high of 2025.

Still, Evercore ISI strategist Julian Emanuel points out that not all stocks are sharing in the rally. While the Russell 3000 has gained roughly 15% this year—matching the S&P 500’s performance—48% of its components remain down year-to-date. Historically, only about 35% of stocks would typically be negative at these index levels.

Evercore’s data shows that despite the Russell 3000’s 41% rebound since its April 7 trough, only 27% of its constituents have climbed more than 10% from that low. Meanwhile, 16% are still below it. This reinforces the idea that “it’s a market of stocks, not just a stock market,” Evercore notes.

That uneven performance sets the stage for the mutual fund tax-loss season, which wraps up on October 31. Tax-loss harvesting—selling losing positions to offset capital gains—often weighs on underperformers in the short term. But according to Evercore, it can also create opportunity.

Looking back to 1990, the firm found that the worst-performing quintile of Russell 3000 stocks from January through October tends to outperform in November, rebounding an average of 2.7% once selling pressure eases.

In short, some of today’s laggards could soon turn into November winners.

Evercore screened the Russell 3000 for what it calls “Tax-Loss Tacticians”—stocks that have struggled relative to the market but remain fundamentally attractive. Among the top 20 by market value are:

UnitedHealth (UNH), Accenture (ACN), Adobe (ADBE), Comcast (CMCSA), UPS (UPS), ONEOK (OKE), Target (TGT), Kraft Heinz (KHC), Kenvue (KVUE), General Mills (GIS), Constellation Brands (STZ), Lululemon Athletica (LULU), Gartner (IT), GoDaddy (GDDY), Centene (CNC), International Flavors & Fragrances (IFF), Dow (DOW), LyondellBasell (LYB), Deckers Outdoor (DECK), and DocuSign (DOCU).

For traders eyeing opportunity, Evercore’s message is clear: October’s pain could set the stage for November’s gain.