Stock Chat... What are you looking at?

[cabmandone]

My financial advisor suggested I consider a SMA. I've heard this but never really looked into what it is. Anyone have any insight?

[stevej37]

^^^

First I've heard of it...but I found this....

https://www.fidelity.com/managed-accounts/separately-managed-accounts/overview?imm_pid=60630695752&immid=100719_SEA&imm_eid=e310493057951&utm_source=GOOGLE&utm_medium=paid_search&utm_account_id=2125700823&utm_campaign=WMC&utm_content=60630695752&utm_term=individual+managed+accounts&utm_campaign_id=100719&utm_id=1596080088&gclsrc=aw.ds&gad_source=1&gad_campaignid=1596080088&gbraid=0AAAAAD7OUhL4pTepBYYydICJA4Qlpgvao&gclid=CjwKCAjw6P3GBhBVEiwAJPjmLs05_q26Q-SQdQrIFQ3DgFWEThLubwchIglT3eW5VqTzAOaNFWp9zBoCluQQ AvD_BwE

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[jyl]

US govt interested in taking stakes in/lending to Australian critical mineral companies, per news reports today.

In addition to MP, I have Lynas (LYSDY) which is an Australian rare earth miner with refining in Malaysia and, I think, Australia and plans for refining/magnet production in Texas, for which they’ve been seeking funding. Lynas can produce heavy rare earths while MP is limited to light rare earths.

I’ve been hoping the EU/Japan would tie up with Lynas to secure their own supply of rare earth products, free of both Chinese and American control. But I guess I’d take a US tie up.

No idea if this will happen or if any deal the US offers will be attractive to Lynas. There are other Australian critical mineral companies.

The stock has been moving. I think there is a huge amount of insider trading and insider dealing going on in the White House at present. Maybe someone knows something.

[cabmandone]

Originally Posted by jyl

US govt interested in taking stakes in/lending to Australian critical mineral companies, per news reports today.

In addition to MP, I have Lynas (LYSDY) which is an Australian rare earth miner with refining in Malaysia and, I think, Australia and plans for refining/magnet production in Texas, for which they’ve been seeking funding. Lynas can produce heavy rare earths while MP is limited to light rare earths.

I’ve been hoping the EU/Japan would tie up with Lynas to secure their own supply of rare earth products, free of both Chinese and American control. But I guess I’d take a US tie up.

No idea if this will happen or if any deal the US offers will be attractive to Lynas. There are other Australian critical mineral companies.

The stock has been moving. I think there is a huge amount of insider trading and insider dealing going on in the White House at present. Maybe someone knows something.

"Since the close of trading last week, shares of the magnet mining and production company USA Rare Earth (NASDAQ: USAR) had blasted roughly 57% higher, as of 11:14 a.m. ET Friday. The big move comes as media outlets report that the company is in talks with the Trump administration for the U.S. government to acquire a stake in the company."

https://finance.yahoo.com/news/why-shares-usa-rare-earth-161130516.html

[cabmandone]

I decided to go in on BKR. I'm looking at Plug Power. A few analysts see a lot of upside potential.

Oh yeah.... REALLY wishing I had bought more AMD back in April!!! Good Night! The news about a deal with Open AI has it up 24% in pre-market

[red 928]

Originally Posted by Helix8

In a highly controversial CNBC interview on March 18, 2020, billionaire hedge fund manager Bill Ackman issued a dire "hell is coming" warning about the COVID-19 pandemic and its economic impact. While publicly advocating for a nationwide shutdown, his firm, Pershing Square, had already been profiting from a massive market crash hedge, which earned them $2.6 billion.

Bill Ackman believes 10-year Treasury yield could approach 5% soon
In late September 2023, speaking at a CNBC conference, Bill Ackman stated he wouldn't be surprised if the 10-year Treasury yield approached 5%, citing persistent inflation due to structural issues like high energy prices and a resurgent labor movement. He suggested this was a "different world" with historically low interest rates, and that the Federal Reserve would struggle to return inflation to its 2% target.
Yes, Bill was already short USTs when issuing his dire warning and covered shortly after the market moved.

He does have a tendency to “talk his book” on CNBC looking to affect the overall market to his benefit. I’m not a fan of this practice but he is not alone in those that try to instill fear and create big market moves after establishing positions (look what Meredith Whitney did to the Muni market).

I’ll pass on ACKY on principle.

I don't like the guy either but don't see the point.
He predicted the covid meltdown and said so on TV?
he's the devil.

He predicted that treasury yields would go to 5% and said so?
Evil.
Same goes for the people here on PPOT who were saying the same thing at the time.


But none of that matters in this case:
I didn't invest in a fund or ETF that has anything to do with him, except it mirrors his fund's investments.

I can't stand nancy pelosi but I made money investing in NANC

[jyl]

AMD has me happy (own it in portfolios) and unhappy (give away $32BN of stock for 6-7 GW of GPU sales - not sure what the net gross margin on that is but it’s not going to be great). I guess after NVDA did its (much better) deal with OpenAI, AMD decided it couldn’t risk being left out. GOOG, MSFT, META, AMZN all have or are developing their own GPUs (called XPUs sometimes, GOOG calls them TPUs) so the future market share for merchant silicon will be a fraction of the current share, AMD wants to get part of that.

These deals are getting really circular, basically vendors transferring money from the balance sheet to the income statement. OpenAI sits in the middle with its incredibly grandiose visions of AI doing everything and consuming all the electricity to do it and all the money to build it. In a way, Altman is trying to make OpenAI “too big to fail”, so that everyone from the US Govt to NVDA invested in its survival. Maybe if he can get the big banks on the hook too, we can have a real financial crisis setup.

[MBAtarga]

Originally Posted by cabmandone

My financial advisor suggested I consider a SMA. I've heard this but never really looked into what it is. Anyone have any insight?

Look up Fisher Investments - they do SMA's (but I didn't know there was an acronym for it until your post.) Beware once they have your name/number - you'll likely never be able to get them to stop calling.

[jyl]

So for fun I looked at the cost and effectiveness of hedging a portfolio with SPX puts at current volatility.

Suppose the portfolio has 0.65 beta, using 3 month 10% out of the money puts costing about 0.7% of the total portfolio value, you can partially protect - if SP500 falls -10%, unhedged portfolio -6.5% but hedged portfolio -4%, if SP500 falls -20%, unhedged -13% hedged -6-7%, very very roughly and ignoring alpha and the elevated correlation of market selloffs. If SP500 doesn’t have a sufficient decline, you spent 0.7% on the hedge for no payoff. I can’t recall if that is before or after tax. That’s only three months though.

[cabmandone]

Originally Posted by jyl

AMD has me happy (own it in portfolios) and unhappy (give away $32BN of stock for 6-7 GW of GPU sales - not sure what the net gross margin on that is but it’s not going to be great). I guess after NVDA did its (much better) deal with OpenAI, AMD decided it couldn’t risk being left out. GOOG, MSFT, META, AMZN all have or are developing their own GPUs (called XPUs sometimes, GOOG calls them TPUs) so the future market share for merchant silicon will be a fraction of the current share, AMD wants to get part of that..

From what I read, there are stock price thresholds that will have to be met in order for Open AI to receive the stock.


Also, news this morning that the government is taking a stake in Trilogy Metals

[jyl]

Originally Posted by MBAtarga

Look up Fisher Investments - they do SMA's (but I didn't know there was an acronym for it until your post.) Beware once they have your name/number - you'll likely never be able to get them to stop calling.

Fisher = bad news.

[cabmandone]

I'm wondering if American Rare Earths might be on that list for potential investment? American Rare Earths is an Australian company developing Halleck Creek. I told my FA that I want to put money where the government is looking to put money. I figure I don't have to go huge on any one particular sector, just spread some money around in nuclear and rare earths. I was ahead of the curve with Intel but I'm playing from behind in the other areas. Seems like nuclear power and rare earths represent a lot of upside growth potential since both are going to be needed to fuel the growth in tech.

[Paul T]

Originally Posted by jyl

Fisher = bad news.

Agreed. As a general rule, any firm that advertises on CNBC 30 times a day, you’d do best to avoid. Fees are horrible. Any big firm can put together an SMA for you, tailored to your needs.

[Paul T]

Originally Posted by jyl

So for fun I looked at the cost and effectiveness of hedging a portfolio with SPX puts at current volatility.

Suppose the portfolio has 0.65 beta, using 3 month 10% out of the money puts costing about 0.7% of the total portfolio value, you can partially protect - if SP500 falls -10%, unhedged portfolio -6.5% but hedged portfolio -4%, if SP500 falls -20%, unhedged -13% hedged -6-7%, very very roughly and ignoring alpha and the elevated correlation of market selloffs. If SP500 doesn’t have a sufficient decline, you spent 0.7% on the hedge for no payoff. I can’t recall if that is before or after tax. That’s only three months though.

Yup, hedging is expensive. Plenty of people have gone broke trying to hedge when ultimately they were right, yet got the timing wrong. What’s the saying? The market can stay irrational longer than you can stay solvent?

[jyl]

Originally Posted by Paul T

Agreed. As a general rule, any firm that advertises on CNBC 30 times a day, you’d do best to avoid. Fees are horrible. Any big firm can put together an SMA for you, tailored to your needs.

It is a marketing machine.

If you do some digging, you can find mutual funds that Fisher managed, either under their own name or as sub-advisor, and look at their performance. What I found was that their funds blew up spectacularly in the GFC and were subsequently closed.

I know some ex-Fisher "PMs" and don't like what I heard.

[cabmandone]

I did some more looking at Mitsubishi Heavy Industries and they produce gas powered turbines AND solid oxide fuel cells which would seem to position them well for data center growth. I also looked into Plug Power. They seem positioned for growth and at less than $4 per share it seems like a stock a person buy and hold for future growth.

[jyl]

I’m looking at Mitsubishi Heavy - we can compare notes as we go along.

[cabmandone]

Originally Posted by jyl

I’m looking at Mitsubishi Heavy - we can compare notes as we go along.

I'm just starting to get some time to get back into researching all of this. You mentioned Mitsubishi was doubling turbine production back on 9/8. I didn't realize they make SOFC's, which is what Bloom Energy produces. I don't recall seeing MHI on the list when I looked at the makers of SOFC's previously but apparently they're one of the larger producers along with Bloom. When I glanced earlier at build out times it seems any of the options for point of use take longer due to backlogs. I'm not sure if that's a bad thing since the order backlogs would seem to indicate high demand.

https://www.utilitydive.com/news/mitsubishi-gas-turbine-manufacturing-capacity-expansion-supply-demand/759371/
"Jake Rubin, media relations lead for Siemens Energy in North America, said in an email that in the third quarter, half of the company’s gas services division’s orders came from the U.S."
"Gas Services secured gas turbine orders totaling 14 GW in the fiscal year to date, 65% of which are for data centers,” he said.

"The solid oxide fuel cell market is highly consolidated, with a small number of major players accounting for the majority of global market activity. The combined market share of Bloom Energy (US), Mitsubishi Heavy Industries, Ltd. (Japan), AISIN Corporation (Japan), and Kyocera Corporation (Japan) is estimated to be between 70% and 80%"

Doosan is a player in SOFC's and they produce Proton Exchange Membrane fuel cells (PEMFC) which is what Plug Power makes. I haven't really gotten into this much but the PEM's seem to have an advantage in startup time, but the SOFC's can operate on different fuels versus PEMFC's utilizing just pure hydrogen.

Most of the research I've done indicates that PEMFC's are better suited for transportation and machinery but Plug Power seems to be building momentum in the large commercial generation arena.

https://www.marketbeat.com/originals/the-juice-is-loose-why-plug-powers-rally-is-just-the-beginning/#google_vignette


Seeking Alpha is negative on the growth potential of PEMFC's for data centers
https://seekingalpha.com/article/4828477-plug-power-sell-on-unwarranted-ai-data-center-hype

https://www.nasdaq.com/articles/where-will-plug-power-be-25-years

[gregpark]

Anyone watching precious metals?

[jyl]

Originally Posted by gregpark

Anyone watching precious metals?

Started buying gold a year or more ago, about 5-8% in portfolios. I don't do the other ones. Looked at gold miners a few months ago, couldn't get to a decision, to my great regret now.