Archive for the ‘Phil’s Favorites’ Category

My favorite new investing app on earth

 

My favorite new investing app on earth

Courtesy of 

One of the single greatest ways to better understand the markets is to know the biggest, most influential companies really well. But this is time-consuming and an ongoing process. You’re never done.

Even if you’re an indexer (or a financial advisor using indexes in portfolios), if you don’t grasp the themes and concepts that are moving the biggest stocks within the indexes, then you’re not really doing your job as an investor. It’s hard to be an expert on all 500 stocks in the S&P 500 (and nobody is in real life) but certainly you could do worse than to keep track of between 10 and 20 companies from time to time, in different industries, to give you a good perspective on why things are moving the way that they are.

One of the blessings I have as a full-time cast member on CNBC’s The Halftime Report is that I have to come correct each appearance. I can be asked about a host of different topics at any moment while on the show and my role is to be current, informed and knowledgable on enough of them so as to be helpful for the viewers. This forces me to stay engaged with individual names at a level that I might not have to under other circumstances. And through the prism of knowing what’s going on with firms from Home Depot to Nvidia to Disney to Prologis, I think my perspective on what’s driving the markets has improved overall. I’ve been doing the show multiple times per week since 2011, so it’s been a long journey of learning, researching, formulating opinions, changing them and being honest with myself about my own limitations.

I think that if every investor had a system to keep up with a handful of important names, it would greatly improve their understanding of the big picture. In the age of indexing, the need to do this has become lost on many. You’d be amazed at how many “market watchers” have settled into the shorthand of just looking at the S&P 500’s current level, assessing the valuation and trend,


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PalanThiel: The Uncola

 

PalanThiel: The Uncola

Courtesy of Scott Galloway at No Mercy/No Malice@profgalloway

Variation is an aspect of natural selection that helps a population’s gene pool to develop new traits. Those traits allow the next generation to adapt to changing environments. Symmetry of facial features is attractive, as it indicates an absence of maladies. We’re also drawn to people from different places, as it’s less likely we’ll cross the same two defective genes, like Tay-Sachs or hemophilia. 

The subtle instincts of natural selection play out in our consumer choices, such as choosing branded denim or which artificially colored carbonated water, mixed with phosphoric acid, to stock in the fridge. Our subconscious desire to have more adaptable offspring rears its symmetrical head and decides that if Dad is wearing Nikes, I need Adidas. 

In the sixties, the 7UP company faced a dilemma — how to carve share from brands Coke and Pepsi, who had the good judgment to put an addictive substance, caffeine, in their product. 7UP’s “Uncola” campaign was a breakthrough, positioning the cola brands as the establishment when the country was feeling especially anti-establishment, in the sixties. Featuring Trinidadian dancer and actor Geoffrey Holder, 7UP’s “Uncola” campaign broke racial barriers and held the promise of a different type of soft drink — and diversifying your gene pool with a Trinidadian dancer. (Note: Mr. Holder played a Bond villain, was married to a spectacular dancer/choreographer, Carmen de Lavallade, for 59 years, and passed away at 84 — a nice life.)

The Uncola of a sector gains relevance around the time everyone throws in the towel, all new entrants mimic the leader, and the sector has the variance of your Dockers-wearing dad. The most innovative Uncola of the last decade is Shopify, who became the non-Amazon…
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Can Trump and McConnell get through the 4 steps to seat a Supreme Court justice in just 6 weeks?

 

Can Trump and McConnell get through the 4 steps to seat a Supreme Court justice in just 6 weeks?

A political battle is shaping up over the confirmation of the next Supreme Court Justice. Jose Luis Magana / AFP/Getty Images

By Caren Morrison, Georgia State University

United States Supreme Court Justice Ruth Bader Ginsburg died on Sept. 18, thrusting the acrimonious struggle for control of the Supreme Court into public view.

President Trump and Senate Majority Leader Mitch McConnell have already vowed to nominate and confirm a replacement for the 87-year-old justice and women’s rights icon.

This contradicts the justification the Republican-controlled Senate used when they refused to consider the nomination of Merrick Garland, President Barack Obama’s pick for the Court after the death of Antonin Scalia in February 2016.

Garland, a moderate judge on the D.C. Circuit Court of Appeals, was nominated in March 2016, but McConnell balked on the basis that it was an election year.

“The American people are about to weigh in on who is going to be the president,” said McConnell in March 2016. “And that’s the person, whoever that may be, who ought to be making this appointment.”

Senate Majority Leader Mitch McConnell and Sen. Lindsey Graham walking together

Senate Majority Leader Mitch McConnell and Sen. Lindsey Graham both have consequential roles in the confirmation of a new Supreme Court justice. Drew Angerer/Getty Images

The 2020 presidential election was just 46 days away on the day of Bader Ginsburg’s death, but McConnell has apparently abandoned such considerations this time around. Trump tweeted on Sept. 19 that he would nominate a replacement “without delay.”

Since the 1990s, the Supreme Court has increasingly split 5-4 along ideological lines on many important cases, including decisions on voting rights, affirmative action, gay marriage, the Affordable Care Act, gerrymandering and gun rights.

Being able to replace a reliable liberal voice on the Court with a conservative justice would entrench a 6-3 tilt towards the right for years. There is bound to be vehement opposition from the Democrats.

However the politics play out, there is a…
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Ruth Bader Ginsburg helped shape the modern era of women’s rights – even before she went on the Supreme Court

Supreme Court Justice RBG passed away from complications of metastatic pancreatic cancer yesterday. RIP, the Notorious RBG.

Ruth Bader Ginsburg helped shape the modern era of women's rights – even before she went on the Supreme Court

Judge Ruth Bader Ginsburg paying a courtesy call on Sen. Daniel Patrick Moynihan, D-N.Y., left, and Sen. Joseph Biden, D-Del., in June 1993, before her confirmation hearing for the Supreme Court. AP/Marcy Nighswander

Courtesy of Jonathan Entin, Case Western Reserve University

Justice Ruth Bader Ginsburg died on Friday, the Supreme Court announced.

Chief Justice John Roberts said in a statement that “Our nation has lost a jurist of historic stature.”

Even before her appointment, she had reshaped American law. When he nominated Ginsburg to the Supreme Court, President Bill Clinton compared her legal work on behalf of women to the epochal work of Thurgood Marshall on behalf of African-Americans.

The comparison was entirely appropriate: As Marshall oversaw the legal strategy that culminated in Brown v. Board of Education, the 1954 case that outlawed segregated schools, Ginsburg coordinated a similar effort against sex discrimination.

Decades before she joined the court, Ginsburg’s work as an attorney in the 1970s fundamentally changed the Supreme Court’s approach to women’s rights, and the modern skepticism about sex-based policies stems in no small way from her lawyering. Ginsburg’s work helped to change the way we all think about women – and men, for that matter.

I’m a legal scholar who studies social reform movements and I served as a law clerk to Ginsburg when she was an appeals court judge. In my opinion – as remarkable as Marshall’s work on behalf of African-Americans was – in some ways Ginsburg faced more daunting prospects when she started.

Thurgood Marshall, in 1955, when he was the chief counsel for the NAACP. AP/Marty Lederhandler

Starting at zero

When Marshall began challenging segregation in the 1930s, the Supreme Court had rejected some forms of racial discrimination even though it had upheld segregation.


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What if he doesn’t leave?

 

What if he doesn’t leave?

Courtesy of 

If Donald Trump loses the election – by any margin – does anyone see him actually conceding? Me neither. Biden may not be so fast to concede either, especially given the nature of a pandemic at the polls. The (mostly made up) controversy about mail-in ballots is sure to make this an election to remember. Contested elections have been rare in recent history, but not unheard of. How might the market react, before, during and after?

Listen to the new episode of my podcast below or wherever your favorite podcasts are streamed.

This week Josh talks to Business Insider columnist Linette Lopez about what happens to the stock market if Trump loses and doesn’t leave. And is Joe Biden so terrible for investors? Tax expert and Ritholtz Wealth CFO Bill Sweet weighs in. Plus, Josh’s take on the explosive Snowflake IPO and a round of What Are Your Thoughts? with Michael Batnick.

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The 2020 Atlantic hurricane season is so intense, it just ran out of storm names

 

The 2020 Atlantic hurricane season is so intense, it just ran out of storm names

Hurricanes Marco and Laura swept through the Gulf of Mexico just two days apart in August 2020. Joshua Stevens/NASA Earth Observatory

By Kimberly Wood, Mississippi State University

Here’s how active this year’s Atlantic hurricane season has been: When Tropical Storm Wilfred formed on Sept. 18, the National Hurricane Center exhausted its list of storm names for only the second time since naming began in 1950. A few hours later, the next storm formed – now known as Alpha.

Even more surprising is that we reached the 21st tropical storm of the year more than two weeks earlier than in 2005, the only other time this happened. And the 22nd storm, Alpha, was nearly a month earlier.

The 2020 Atlantic hurricane season is far from over. With the new storm, forecasters shifted from the alphabetical list of people’s names to letters of the Greek alphabet – Alpha, Beta and so on. The 2005 season had six Greek-letter storms, ending with Zeta.

So, why is the Atlantic so active this year? Meteorologists like myself have been following a few important differences, including many tropical storms forming closer to the U.S. coast.

What’s causing so many tropical cyclones?

When a disturbance – a large blob of convective clouds, or thunderstorms – exists over the Atlantic Ocean, certain atmospheric conditions will help it grow into a tropical cyclone.

Warm water and lots of moisture help disturbances gain strength. Low vertical wind shear, meaning the wind speeds and directions don’t change much as you get higher in the atmosphere, is important since this shear can prevent convection from growing. And instability enables parcels of air to rise upward and keep going to build thunderstorms.

This year, sea surface temperatures have been above average across much of the Atlantic Ocean and wind shear has been below average. That means it’s been more conducive than usual to the formation of tropical cyclones.

La Niña probably also has something to do with it. La Niña is El Niño’s opposite – it happens when sea surface temperatures in…
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More Than One Third Of All NYC Residents Consider Leaving

Courtesy of Mike Shedlock via MishTalk

The cost of living in New York City is so steep that in the past 4 months, 35% have considered leaving.

High Income Flight

A Siena College study shows 44 Percent of Six-Figure Earners in NYC Have Considered Relocating.

The study also states 80% of those living in the city make $100,000 or more, and that translates to 35.2% of all residents.

Key Findings

  1. Of New York City residents who earn $100,000 or more annually, 44% have considered moving out of the city in  the past four months. Looking ahead, 37% say that it is at least somewhat likely that they will not be living in the city within the next two years.

  2. More than two-thirds (69%) are “not confident that New York City will be back to normal anytime soon,” while just 28% believe that the city “will weather this crisis, and things will be back to normal soon.” 

  3. Respondents from Staten Island are especially pessimistic: 89% say that they are not confident in a timely return to normalcy. 

  4. Some 80% of New Yorkers earning six-figure salaries or higher believe that economic activity in the city will take longer than a year to recover, and just 20% say that the economy will return to normal in the next 12 months. 

  5. Older respondents are more pessimistic about the recovery, with 89% of those 65 years and older expecting recovery to be more than a year away

  6. Only 38% of New Yorkers surveyed said that quality of life now was excellent or good, a drop by half, from 79% before the pandemic. Most believe that the city has a long road to recovery: 69% say that it “will take longer than a year” for quality of life to return to normal.

  7. 75% of respondents cited income taxes as a problem, while 72% pointed to traffic and 68% to the reliability of public transportation. 

  8. The greatest concern of all was the likelihood of coronavirus spread, with 90% saying that it posed a problem


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Quad-Witch Trigger: “Staggering Gamma Collapse” Opens Market Trapdoor If QQQ Slides Below 270

Courtesy of ZeroHedge

The relentless gamma meltup of late August, early September is now ancient history, and following today's "quad witch" expiration, Nomura's Charlie McElligott writes that the "Nasdaq is open to a MUCH larger trading range coming-out" following what he calls a "staggering collapse" in dealer gamma, with 63% running off and now totaling a negative -$564.5mm, which is not only the lowest since late 2018 when the market suffered its first mini bear market of the post crisis period, but is also just a 2.3 percentile since 2014…

… while dealer Delta is -$15.5B, just 2.8%ile since 2014…

And unlike just two weeks ago, when spot was solidly in positive gamma territory, dealers are now near the extremes of "short gamma" territory vs spot, with QQQ spot at $272…

… far below the "gamma neutral" line at $281.64.

To McElligott, this matters "because the QQQ $270 strike probably needs to and probably will be well-defended today by market-makers short this monster in size", but if selling persists and the $270 "trigger" in QQQs is taken out, that's when "things could get sloppy to the downside into next week."

Away from the Nasdaq, the Nomura cross-asset strategist believes that the S&P seems "safe" as it is currently pinning around the “gamma neutral” level of ~3380 (3360 spot ref).

A few more observations as we head into this key for market volatility day, first looking at factors, where McElligott notes that the last few days look pretty "gross-down-ish" which he views as "rational" in the risk-management sense, as books trade through VaR limits in light of the recent vol events and need to be reduced. This is important because what on the surface may look like "Value over Growth" rotation "is really about the mechanical realities of reducing partial of your longs and covering a portion


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Berkshire in Techland

 

Berkshire in Techland

Courtesy of 

Warren Buffett and Charlie Munger have studiously avoided the IPO game for almost six full decades now. Here are some quotes from Buffett that should give you some idea of his take on these types of investments:

“You don’t have to really worry about what’s really going on in IPOs. People win lotteries every day…”

and

“If they want to do mathematically unsound things and one person gets lucky… it’s nothing to worry about,” Buffett said. “You don’t want to get into a stupid game just because it’s available.”

These statements would definitely not help his popularity on the Wall Street Bets subreddit in this day and age.

But Berkshire Hathaway did make a pre-IPO investment in Snowflake, which went public today as the largest software IPO of all time. The Berkshire stake is now worth considerably more than the shares they purchased directly from the company and from a selling shareholder.

Berkshire Hathaway (I am personally long the B shares) now has a market value of $500 billion and change. Approximately half of that is comprised of Apple stock and cash. Under the stewardship of the two younger stockpickers Warren Buffett brought on, the portfolio has begun to slowly tilt toward technology, with investments in Mastercard, Visa and even Amazon being credited to the proteges who will likely someday take over the entire portfolio.

As a thought exercise, what if Berkshire Hathaway began to seriously flex its financial muscles throughout Silicon Valley and start getting more heavily involved in large secular trends like data, AI, machine learning, cloud computing, data centers, ecommerce, logistics and fulfillment? Buffett has personally expressed a lack of interest in betting on innovation for decades, but he’s 90 and has come to rely more and more on his investment committee in public market investments these days. He has also probably come around to the idea that there are areas within technology that are more than just bets on innovation – areas that allow him to be invested in the type of big moat, high cash


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The PhilStockWorld.com Weekly Webinar – 09-16-2020

For LIVE access on Wednesday afternoons, join us at PSW!

 

Major Topics:

00:01:05 – S&P 500
00:06:55 – Global Warming
00:23:58 – LNG
00:38:41 – Trading Techniques
00:43:02 – M
00:48:07 – Currencies
01:10:27 – TSLA
01:15:50 – LTP
01:17:24 – FCX
01:18:11 – TIF
01:19:74 – M
01:21:51 – BRK-B
01:22:57 – CSCO
01:23:07 – HMY
01:25:22 – VIAC | VLO
01:25:56 – WBA
01:26:27 – Trading Techniques
01:27:59 – M

Phil's Weekly Trading Webinars provide a great opportunity to learn what we do at PSW. For LIVE access to PSW's Weekly Webinars – demonstrating trading strategies in real time – join us at PSW!

You can also subscribe to our YouTube channel and view past webinars here





 
 
 

Phil's Favorites

The case of Biden versus Trump - or how a judge could decide the presidential election

 

The case of Biden versus Trump – or how a judge could decide the presidential election

Will judges decide who wins the presidential election? Geoff Livingston/Getty

By John E. Finn, Wesleyan University

Imagine the morning of Wednesday, Nov. 4, 2020. Given the unprecedented number of mail-in votes this election, Americans may wake up and still not know who won the presidential contest between Republican President Donald J. Trump and Democratic...



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Politics

The case of Biden versus Trump - or how a judge could decide the presidential election

 

The case of Biden versus Trump – or how a judge could decide the presidential election

Will judges decide who wins the presidential election? Geoff Livingston/Getty

By John E. Finn, Wesleyan University

Imagine the morning of Wednesday, Nov. 4, 2020. Given the unprecedented number of mail-in votes this election, Americans may wake up and still not know who won the presidential contest between Republican President Donald J. Trump and Democratic...



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ValueWalk

Financial Strategies for Businesses During COVID-19

By Ankur Shah. Originally published at ValueWalk.

The COVID-19 pandemic has left no business unaffected in many different ways. Most are taking a financial hit across industries. Some may not last through it all.

Q2 2020 hedge fund letters, conferences and more

In order to keep your organization afloat, you’ll need to employ a variety of strategies, technological and otherwise. Here are some ways to plan ahead and help your business survive.

Plan for Different Time Periods and Scenarios

Nobody knows how lon...



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Zero Hedge

Nano-X Shares Plunge After Muddy Waters Says Company Has "No Product To Sell Other Than Its Stock"

Courtesy of ZeroHedge View original post here.

Nano-X shares are plunging this morning after well known short seller Muddy Waters Research has published a new report comparing it to Nikola on numerous occasions (this year's short reference du jour, we guess) and saying it "has no product to sell other than its stock." Shares have fallen 20% in the pre-market.

...



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Biotech/COVID-19

SARS-CoV-2 infection can block pain, opening up unexpected new possibilities for research into pain relief medication

 

SARS-CoV-2 infection can block pain, opening up unexpected new possibilities for research into pain relief medication

The spike protein on SARS-CoV-2 interferes with pain perception. SEBASTIAN KAULITZKI/SCIENCE PHOTO LIBRARY/Getty Images

By Rajesh Khanna, University of Arizona

Imagine being infected with a deadly virus that makes you impervious to pain. By the time you realize you are infected, it’s already too late. You have spread it far and wide. Recent findings in my lab suggest that this scenario may be one rea...



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Kimble Charting Solutions

Could It Be "Schitts Creek" For Technology Stocks If Selling Starts Here?

Courtesy of Chris Kimble

The Nasdaq has been the unparalleled leader of the stock market in 2020, having rallied furiously off the COVID-19 crash market bottom in March.

But all of the excitement around tech stocks and the comeback in the stock market may be coming to an end… that is, if a key Fibonacci price target has anything to do with it!

In today’s chart, we look at the long-term “monthly” chart of the Nasdaq Composite Index (IXIC) and focus in on the 18-year rally.

As you can see, the Nasdaq peaked in 2000 and bottomed in 2002. Applying Fibona...



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Chart School

Stocks are not done yet - Update

Courtesy of Read the Ticker

There are a few times in history when a third party said this US paper (stocks, funds or bonds) is worthless.

Here is two.

1) 1965 Nixon Shock - The French said to US we do not want your paper dollars please pay us in gold. This of course led to the US going off the gold standard.

2) 2007 Bear Stern Fund Collapse - Investors said their funds collateral was worth much less than stated. This of course was the beginning of the great america housing bust of 2008.


In both cases it was stated .."look the Emperor is naked!"... (The Empe...

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Digital Currencies

Cryptocurrencies Rarely Used To Launder Money, Fiat Preferred

Courtesy of ZeroHedge View original post here.

Authored by Shaurya Malwa via Decrypt.io,

Traditional channels continue to dominate the estimated $2 trillion global money laundering racket instead of cryptocurrencies, a report says.

In brief
  • Money laundering via cryptocurrencies is not a preferred tool for criminals, a report said...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

...

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. Contact Ilene to learn about our affiliate and content sharing programs.