Why the Nasdaq?
Something astounding happened today, dear reader. The Nasdaq Composite just broke out to fresh all-time highs.
You’re probably questioning why any part of the market is hitting all-time highs when weekly jobless claims and total unemployment figures still come in worse than expected. Or, for that matter, why stocks are rallying at all given the state of the U.S. economy.
For that, allow me to defer to my good friend Ted Bauman and his latest article on the topic: “The Fed’s Video Game Stock Market.”
To make a long story short … it’s the Fed, as you can probably tell from the title of Ted’s article. But I digress…
The question today is: “Why the Nasdaq?” Why not the Dow or the S&P 500? Why aren’t the seminal market indicators leading this Fed-fueled rally?
The answer is quite simple. The Nasdaq is filled with biotech companies, “work from home enabling” tech companies, artificial intelligence (AI) leaders, semiconductor makers and cloud computing specialists.
In short, the tech-laden Nasdaq represents the future.
We’re talking Microsoft Corp. (Nasdaq: MSFT), Amazon.com Inc. (Nasdaq: AMZN) and their dominance of the cloud computing market.
We’re talking Tesla Inc. (Nasdaq: TSLA) and its leading role in the future of alternative-energy cars, trucks and big rig shipping.
We’re talking Advanced Micro Devices Inc. (Nasdaq: AMD), Nvidia Corp. (Nasdaq: NVDA) and Lam Research Corp. (Nasdaq: LRCX) in the AI, 5G and Big Data processing markets.
Now, I saw an article over on MarketWatch today touting a “50-year technological revolution” driven by “the age of connected intelligence.”
If that analysis sounds awfully familiar to you Bold Profits and Paul readers out there, it’s because Paul has been talking about the Internet of Things (IoT) forever. It’s what connects all our devices together, like a spider web of Wi-Fi and data.
If you’re looking for a way to participate in the Nasdaq’s record-setting rebound, I recommend you check out the Invesco QQQ Trust (Nasdaq: QQQ). When it comes to broad-tech investment, the Qs are where it’s at.
But, if you want specific tech stock recommendations, stay plugged-in to Great Stuff or check out the OG (original guru) of tech investing…
850is if you need a lift. Who’s the kid in the drop? Who else, Paul .
Paul just found one tech stock that’s set to transform the way we use and create energy. And there’s a radical energy revolution coming soon to 50 million American homes.
Paul even said: “This technology can single-handedly power a major American city … virtually free of charge.”
Click here to find out more about the one tech stock that Paul recommends you buy now.
And after you’re done getting ‘Pilly with it … let’s jump on some Reader Feedback!
Have you heard? Have you heard?
We’ve got a special on Reader Feedback today — yes, today’s edition comes with two scoops of raisins … I mean, emails. Let’s dig into the greatness.
The Gripes of Hype
Hello; Just once I’d like the same opportunity as rich folk to get in on an IPO that’s being hyped. Years ago, as a middle-aged person, I called around to the usual suspects, who of course had no interest in offering me access to any IPO potentially valuable. Seems downright un-American given my long history as a law-abiding citizen.
So, here I am as an elder knocking on the door of someone who’s also wanting to hear from big investors — with the same question: how to get in on an IPO of the desirable type.
— Linda M.
Hello there, law-abiding Linda! I’m glad you reached out; let’s talk initial public offerings (IPOs).
I get it — it’s easy to feel once bitten, twice shy when it comes to IPO investing. For most people, investing in an IPO is all about access. Will your brokerage firm have access to the stock immediately after it’s publicly available?
Back in the day, this used to be a much bigger problem. However, IPOs have come a long way since the early 2000s. Nowadays, almost everyone and their mother can get in on them through the right brokerage. (Except for Warner Music Group Corp. (Nasdaq: WMG) and Robinhood … What gives, Robinhood?)
Give yours a call now to see how you can get in!
However, if you’re talking about getting in to an IPO stock when all the big boys do — i.e., during the IPO pricing round and before the stock starts trading on an exchange — well, you need to basically be a large financial institution, an underwriting bank or some other major player with a literal ton of money.
Now, we all see the upside to being one of these major players when things go right. However, these investors are also subjected to required lockup periods where they can’t touch investments at all. Not so much fun for the regular investor.
My advice to you would be to turn to the de facto expert in the IPO game: Paul . He can explain the ins and outs of why the IPO market is better now than it’s ever been.
The Registry?! Not the Registry!
Joseph, I thought that I was the only person that thought that way about Norton. I steer clear of any product or service attached the yellow and black. Just like a hornet, you will get stung. Back in the day before I was so computer savvy, I had purchased a Norton “you can’t touch me” subscription. When I was done with their resource hog program, I ran their removal wizard. What a joke! After that, I was deleting files and folders from my C drive, D drive and computer registry. I was down in the weeds hoping I did not wipe out my business computer.
— Dan G.
Hey Dan! Thanks for writing in, from one antivirus victim turned cybersecurity fan to another.
As a nice parallel to what we said on IPOs getting better … antivirus and cybersecurity has also come a long way since the “totally not a virus” antivirus scams of years past. (McAfee, where you at? Belize again?)
Personally, I run Windows Defender (comes standard with Windows 10), a solid VPN (I use PIA), and hardware-based protection on my router (standard on most non-budget routers these days). If issues arise, download Malwarebytes to clean up, and Bob’s your uncle.
On the investment front, all you need to do is check out the proactive industry innovators, like CrowdStrike Holdings Inc. (Nasdaq: CRWD). Yes … this was a roundabout way to further congratulate you on the gain we have in CRWD. So, congrats (again) on the Great Stuff cyber security pick! Dancing days are here again.
No One Can Destroy the Metal!
Copper stocks: Is there room in the portfolio for basic metals?
— Don A.
Thanks, Don! I picked out your email since we don’t typically talk about basic metal, save for music references. So, metals: Who’s buying them?
Here’s a hint: not manufacturers. Car production is down. Homebuilding is down. The government ramped up infrastructure spending — at a state and local level, not nationally.
The only reason to buy into the basic metals market right now is if you think the economic reopening will spark enough demand to create a rise in basic metal prices. They certainly aren’t a safe haven investment in case things go sour again. And if you are that bullish on the market, there are better places to invest. As in … virtually anywhere.
Next time you pass one of those abandoned industrial complexes, look for an equally run-down pickup truck out front. You might find a kind scrapper looking for copper (shout out to my guy Darryl). Do you join? Let’s say you do.
You have successfully invested in basic metals.
Keep MMME Posted
What do you think of 3M … CDC??
— Bert K.
Hey, Bert! Thanks for your quick message. Here’s my hot take on 3M Co. (NYSE: MMM):
- It’s loaded with debt (skyrocketing to $23.3 billion owed over the past two years) at a time when debt’s killing businesses left and right. Granted, 3M has raised its cash on hand slightly, with roughly $4.5 billion available now.
- For 2020’s first quarter, 3M lowered guidance, as did almost everyone else. Earnings beat, but revenue did not. That’s par for the course with what I’ve seen with 3M, with its revenue growth dilly-dallying over the past decade or so. Slower growth, lots of debt … getting lukewarm here.
- 3M is a diversified industrial don. Its health care supplies (masks in particular) have been stockpiled for months, but you bet there’s a whole lot of damage waiting in the wings with its industrial and workplace supplies until purchasing managers start buying again.
So, where does that leave us with 3M? It depends on what kind of investor you are.
If you want fast growth and cheap thrills, well, you’ve probably already stopped reading about 3M. If you’re a value investor, 3M will no doubt have a huge role in supplying the workforce post reopening.
Everyone knows those knockoff Post-its don’t have anywhere near the staying power as the ultra sticky OG from 3M. So, if that’s enough to sell it for you…
Great Stuff: We’ll Stick by You!
That’s it for today, dear reader. Thank you for tuning in!
Remember: You can always share your questions, comments and feedback with us here. Send us a message at GreatStuffToday@BanyanHill.com. We love to hear from you.
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Until next time, be Great!
Editor, Great Stuff