Robinhood, Bitcoin, Space — Major America 2.0 $$$
If you’re in, good! If not … now is the time.
America 2.0 is front and center this week. And that’s no accident…
The market’s making a turn toward the Fourth Industrial Revolution. And we’ve told you about three major players in some of our most popular mega trends:
Forget the FUD (fear, uncertainty and doubt) and look at how these are going to rocket up to astronomical new highs!
Find out what’s unfolding this week in the three biggest mega trends — fintech, crypto and space. And of course, how YOU can get in:
Hey everyone. It’s Paul. Today I am going to talk about three important parts of the America 2.0, Fourth Industrial Revolution investing landscape. I will cover things I have been talking about on this channel for a long time.
We are going to cover space because there’s a lot of stuff going on. Second, we will cover Bitcoin (BTC). Then I made a video recently on Robinhood and being that I mentioned the opportunity to you, I wanted to give you an update on what is going on with Robinhood.
If you track back to my previous video you will see I told people that Robinhood is coming IPO. For those of you who are new to the stock market, it means for the very first time a company’s stock is available for regular people to invest.
Robinhood, very much in keeping with its own theme of opening up access to the stock market, investing, trading and speculating to everybody, is going to leave 35% of its IPO shares for users of its app. I can tell you this is a very unusual thing.
The vast majority of companies leave something like 1% or 2%. In other words, nothing really for regular investors. Robinhood, in keep with its mission, is setting aside 35% of its shares for regular investors.
In my previous video I said that looking at everything from sales growth, user growth and what their sales comprise of — which is options, which is profitable for a brokerage company — and so many things that eliminate barriers to investing which are unique to them, including no minimum balance, no commission, access to things like crypto which regular brokerage firms do not offer.
These are attractive things. Then, I actually found some additional things that made me feel even more positive about it. One is that in excess of 50% of the people who have opened up an account on Robinhood are doing it for the very first time. While many of them may have started with small numbers, today they are putting in well in excess of $10,000.
This is not a case where people are putting nothing in. The last thing I found out is that their average cost of acquiring a customer in 2021 has dropped to as little as $20. In other words, for them to get a customer on Robinhood costs them very little.
In my business for example, we have a newsletter called Profits Unlimited, it can cost us in excess of $200 or even $300 to do the same thing. The brokerage firms like Schwab and others are in the same territory. Essentially, that’s marketing expense.
They have to run an ad thousands and thousands of times to get one click that actually ends up in a sale. Robinhood does that by its little secret: It gives away a stock. That’s attractive enough to a lot of people to actually get them started. Also, there’s no minimum balance to eliminate the barriers.
So there’s lots of good things. Final details that are important if you were considering buying into the Robinhood IPO — just to explain what that is, when a company is about to come public they distribute shares before it starts trading on the actual stock market.
After allocating 55 million shares among retail investors, institutional investors, pension funds, hedge funds, family offices that have good relationships with Morgan Stanley and Goldman Sachs, if there is additional demand left then the market determines the price by seeing who are willing to sell and at what price.
When that demand and supply is in the favor of demand, you get a one-day pop. Many people like that. They live for these 20% pops. That’s something that’s a judgment you will have to make. I have to warn you, this channel is not financial advice.
Anything you choose to follow is your own decision. It’s always possible to lose money in the financial markets. Markets are speculative. That’s something that comes with the territory. This is not a guarantee that Robinhood IPO is likely to be one that is successful.
In my opinion, the odds look good. Of the 55 million shares, they are going to allocate 19.25 million shares to retail investors who are on their platform. You would need to download their app, go to their IPO access section. They will ask you how much you want to pay.
Rather than telling them how much you want to pay, it’s more of a poll to see how interested you are. If you are really interested and willing to pay a high price, then you would put a high number because it means you are very interested in owning it.
If you are not so interested, you would put a low price. The other thing is that with IPOs you have to have your cash in the account. You can’t buy on margin. You have to have the money in the moment they issue shares. That means you have to line all those things up to do it now.
In full disclosure mode, I told my Profits Unlimited subscribers — we have around 120,000 or 130,000, it varies month to month — this is a good deal and they should consider participating in it.
I will be doing an update on Robinhood on the Profits Unlimited update later this morning. If you subscribe, you will have access to that. To round out the end of this, Robinhood is supposed to start trading on Friday. Thursday night, the prices will be finalized.
The prices, per what I am reading in the press, is supposed to come between $28 and $32. At that price it would be valued at anywhere between $35 billion to $40 billion. When you look at all the things I mentioned in my previous video, you can see this is a fast-growing company with a young demographic.
It’s skewed toward trading in profitable segments like options. The big knock on it and the controversy is they sell their orders. They get payments for order flow. However, I went and researched this. The truth is everyone — TD Ameritrade, Schwab, E*Trade — they all do it.
This is, as they say in the crypto world, a piece of FUD. When the financial media talks about it they don’t tell you that everyone else does it as well. Robinhood generates about $520 million per quarter, at least that’s what it was in the first quarter of 2021.
If you annualize that, it’s more than $2 billion per year. So the Robinhood IPO is coming. They’re setting aside as much as 35% of their shares for regular investors on their platform. It may be possible to get it from brokers, but it will be a lot easier if you are using Robinhood.
You need to download it. You need to go to IPO access. You need to have cash in your account and you need to bid for it to be able to get access to the IPO. I have gotten a few questions on Twitter and, unfortunately, this is only for U.S. citizens because it’s going to trade on U.S. markets.
Robinhood is not listed in UK, Ireland, Australia, Switzerland or other places. So you need access to a U.S.-based account to be able to participate. That’s agenda number one done. Robinhood is coming IPO this week.
The second one is Bitcoin (BTC). Those of you who follow BTC closely, my guess is if you own any amount you track the price all the time because it’s trading all the time. Sometime on Sunday night while folks in in Eastern Standard Time were sleeping, BTC started to rocket up.
It went from about $30,000 to nearly $40,000 on Monday. It’s now trading in the $38,000 range. As you know, I have put myself out there by saying I believe that BTC can be priced at $250,000 by June 20, 2022. From where I sit, nothing has changed.
You have an extreme demand and supply imbalance with BTC. There are a limited number. When it’s all mined there will be 21 million. Right now it’s somewhere between 18.5 million and 19 million. You have massive demand developing.
In the previous cycle when BTC hit $20,000 in 2017, it was an asset that was owned by very few people, almost all individuals. There might have been a few hedge funds here and there, but they would have been seen as a little bit crazy. So most people wouldn’t go near it.
Today it’s a completely different scenario. The supply side is unchanged because BTC is mathematically finite. 21 million coins forever. That’s all that can be mined. Of which, 18.5 million or 19 million are already mined. Then there are a lot of people who bought BTC at much lower prices that are doing what they call hodling.
In other words, they are just going to keep holding it forever. BTC is digital gold. It’s being as a store of value around the world. We have so many things going on that didn’t existing in 2017. We have companies like Square, Tesla and MicroStrategy. Then you have El Salvador that has recognized it as legal tender.
I believe that other countries in the same position as El Salvador are going to find BTC is a better alternative to them because BTC’s policies are mathematically defined rather than whatever the Federal Reserve decides to do with the dollar in the U.S. being imposed on various countries.
We have so many things going on. By yearend, how many more companies will have bought BTC? How many more countries will recognize it as legal tender? How many more people seeing other people having gotten rich or are making money as a result of BTC rising are going to want it?
As my incredible colleague Ian Dyer likes to say, there’s more demand at higher prices. This is actually true. It is only at the very top that the folks who have made a lot of money start to sell. Some people are arguing that’s where we are right now. I disagree.
I believe we are early in the BTC era. You can see that if the world’s demand comes for BTC it is going to go to stratospheric heights. Nothing has changed. All the FUD on BTC is still all the same. There’s FUD about zero day exploits, it being hacked, it being worth nothing, the fact it’s not used as a currency.
That’s the nature of all bull markets. There’s a litany of complaints and arguments as to why you should stay out. It’s only once the price has risen a great deal and all these complaints have been dealt with do the people who dislike all these things and have all these questions come into it.
By then, the biggest gains are going to be in. You are going to miss out. BTC is also in our Profits Unlimited portfolio. We cover it.
The last one is space. In the space of a month — an unintended pun — we have seen two sets of civilian space flights. We’ve seen the billionaire Richard Branson. He is of Virgin fame. He has run a series of businesses. Everything from Virgin Airlines, Virgin Music, Virgin Mobile.
It’s an array of Virgin-branded businesses he has made his money on. Now there’s Virgin Galactic. It’s a publically traded company which I have not recommended. I’m not going to say either way if it’s good or bad. I can’t actually decide one way or the other.
If we decide we are going to buy into it, it will go in one of our services. So he has gone into space using their spacecraft that they have spent billions of dollars to develop. And we have had Jeff Bezos, the founder of Amazon and richest man in the world, also go to space along with three other people: Wally Funk, the youngest person to go into space and also Jeff’s brother.
Now we are starting to see the emergence of a tourist industry that is going to be for very few people. The cost of going to space is still quite prohibitive. However, the real action going on in space is in the servicing of satellites. We have millions of satellites orbiting Earth.
There are issues around debris and positioning. We have identified an incredible stock that we think represents one of the few, real business. Meaning that once they get going they have a solid market where people want their services.
They are going to be able to generate revenue and, over time, once their reinvestment needs are met, significant profits.
The bottom line is that this opportunity feels like it is going to be the biggest opportunity when people look back three or five years from now. For example, I became known for focusing on the Internet of Things (IoT) in 2016. That’s pretty much what space fees like today.
Some people say, “Paul, space needs this to be sorted out or that to be sorted out.” Back in 2016 the knock on IoT was that security needed to be worked out and it wouldn’t be as big as people thought, which was billions of devices connected to the Internet.
They turned out to be wrong. Space is looking through it’s about to go through parabolic growth. We are talking about an economy that’s going to be grown from scratch. It’s going to be worth as much as $1.4 trillion according to a study that was done. This is going to be ramping up fast.
You have also now seen actually real developments. Anyone can go to YouTube and watch Richard Branson’s or Jeff Bezos’ space flight. To me, even more impressive, is SpaceX. It’s the leader of this new space era. They send their rockets to space and then they come back and land.
I have to say I am absolutely addicted to watching these rockets go up. Then, they are building this enormous spaceship called Starship. It’s ultimately designed to go to Mars. That’s the theme of my t-shirt this week. It’s designed to go to Mars — well, Elon’s timeframes are always off.
However, it’s 10 years or somewhere in the next 10 years or so. The value is going to be built along the way. There’s going to be technology developments. There are going to be stepping stones to that ultimate milestone of getting to Mars and putting up that colony.
Then, extending life to a second planet, which is the ultimate goal of Elon Musk and SpaceX. We are well along the way. We have multiple companies that are focusing on reusable rockets. Some of them are now public and we will be looking to put those in either in Profits Unlimited or across our services when the timing is right.
Then there are high-profile companies like Relativity Space that is 3D printing rockets and I believe it can be a genuine competitor to SpaceX. If you are interested in space, subscribe to our channel. We are going to update the space race that’s unfolding.
I believe now is the actual moment to get invested. Another sign that space is really heating up as an investment topic is the emergence of space ETFs, including one from our friend Cathie Wood at ARK Invest. They began a space ETF with the symbol ARKX. You can check into that as well.
That’s this week’s on Robinhood, BTC and space. I hope you liked it. Come back next week. Until then, this is Paul saying bye.
Editor’s Note: As Paul said, space is going to be the biggest investment of the decade. He even put together two special reports on this new America 2.0 space race.
One details the three hottest space stocks you can buy right now. The other is jam-packed with 10 groundbreaking space companies on Paul’s watchlist.
Remember, NOW is the time. You can see how to unlock these stellar reports, get your space stock recommendations and be ahead of more as the space race unfolds.
Editor, Profits Unlimited