9 Long Positions to Consider *Today*
220: Beat the herd when the market rebound comes
Morning lads.
If you missed our last post this week you can find it here — where we covered economic, political, and social considerations for the latter half of 2023 that will impact everyone.
*QUICK NOTE* - I am sending this out ahead of US market open as several of the names in this list today will be impacted by the CPI numbers today and various global news developments (which could hurt or help entries). So bottom line is today’s post is time sensitive — recommend reading it before open.
Today we will be adjusting back to a financial markets focus with a classic post you might see from time to time online — a Top 10 Investment Ideas list. These are 10 different assets that I am focused on in the next month to try and outperform some of the chop and uncertainty that has come to characterize markets in the last 3 years. With CPI dropping later today it will surely be an interesting 24 hours in markets and that may present some opportunities.
Despite short term volatility the sun will eventually shine again and up only will return.
But the winners and losers of the next 10 years will likely be decided in the next two years — the decisions you make outside of your cash flowing business (ideally), your 401K/Roth allocations, and other portfolios that are more passive — will determine how much further you pull ahead of the pack. Do you want to emerge from this period of uncertainty flush with cash and liquidity or scrambling to allocate quickly as everyone receives the green flag at the same time to re-enter markets?
At that point you’re just one of millions in the her who waited a bit too long to enter into names that could see sizeable appreciation well before the masses catch on.
I talk a lot about the changing financial paradigms in our world — those who hold assets and those who don’t or can’t since they either choose to invest poorly or feel pressure from all of life’s costs and expenses that limit their ability to keep and generate more money.
Speculation picks make up only about 20% of my total investable cash — to limit downside and the impact to my overall net worth. With some of the following picks today that allocation may edge closer to 30%.
That being said — as macro conditions hopefully ease and investors begin to feel a bit more confidence about quality positions in the medium term I think there is much to be gained from the names in the following list. Emotions should and need to be removed from investing decisions as much is possible — every trader knows this, but more often than not the best picks are made when sentiment is split or negative (or positive if shorting).
I’ve found it’s a gut feeling combined with a proper understanding of long term drivers — once your cousins and aunts and uber drivers are talking about an investment, oftentimes you are nearing the local top of a crowded trade that is due for a correction.
The aim of today’s post is to generate and discuss some early ideas in the crypto and equity markets that could outperform quickly if sentiment changes and global conditions ease. Make sure to read the disclaimer below — but it goes without saying speed is of the essence here — the underlying assumption should be that the next few days or next week are a good time to enter IN MY OPINION.
Early bird gets the worm homies.
It’s not always easy to do what’s not popular, but that’s where you make your money. Buy stocks that look bad to less careful investors and hang on until their real value is recognized — I’ve never bought a stock unless, in my view, it was on sale — Buy on the cannons and sell on the trumpets
— John Neff Vanguard's Windsor Fund
*Disclaimer* - I am a former commodities trader, enterprise salesmen, part time meme merchant, and online business lord - none of the following should be considered definitive or comprehensive investment advice — always do your own research and thoroughly vet your investments to take into account your personal risk preferences, appetite, and expectations. This list is not made with no consideration for a wider sell off and material recession that drags down all asset prices for an undetermined amount of time, but if that doesn’t happen, we want to be positioned to benefit immensely while insitutions and retail investors are still dipping their toes in the water.
1. Ethereum (ETH) - Crypto
Lartely the hype in crypto has all surrounded Bitcoin. Bitcoin is the logical choice for the first round of mainstream and institutional interest in a post FTX and 2022 correction landscape because Bitcoin is the the first and largest “crypto” asset by market cap.
Bitcoin is limited in supply ($21M) and is one of the most sound and immutable forms of money/reserve assets on the market today and this is being confirmed more and more by the day as larger insitutions announce ETF filings, companies like Microstrategy continue to add the asset, and mainstream commentators begin to shift their sentiment and opinions on the asset with growing adoption news.
There is no doubt in my mind any longer that Bitcoin will be with us for a very long time. The uncertainty with central banks, governments, an global currencies will continue to be tailwinds for Bitcoin in the coming years.
Ethereum is still at the moment, in the shadow and in my opinion has not yet benefited from the “hype” that Bitcoin has. Make no mistake — I see Bitcoin rapidly appreciating in the years to come and have made that clear in Arb Letter before, but Ethereum still has room to run in the short to medium term ahead of long term appreciation. Our good friends
agree largely with this sentiment (you can read their thoughts in their latest post).Once the BTC ETF decisions start to trickle out you can rest assured attention and eyes will begin to drift towards Ethereum being up next at bat. In my opinion at the moment you have the chance to front run this hype a bit in the next several weeks.
If you’ve read Arb Letter for some time you know my current allocation in my crypto portfolio is around 35% with a higher weighting in Bitcoin. Today I am going to change that and add several ETH to up my exposure. If you’re not meaningfully in crypto at the moment it might not be a bad idea to be a bit overweight ETH relative to Bitcoin — I unofficially advise everyone to have Bitcoin but Ethereum is one place outside riskier alt coins and assets that could give an explosive return with the right catalysts as attention shifts away from Bitcoin and adoption grows.
Ethereum has been pinned to the $1,800 range — consider where you could be if you load up now and we’re looking at $4,000 to $5,000 in the next year and a half…..
Long term $10,000 isn’t outrageous.