Editor’s Note: As Chief Investment Strategist of Total Wealth, Keith believes in making his track record of recommendations easily accessible to all readers within seconds – and that’s why he’s compiled an Archives page. Here you’ll find links to every Total Wealth article Keith has published since Total Wealth’s creation on October 2, 2014, posted in reverse chronological order.
Earlier this week we talked about the secret I wish everybody knew when it comes to market timing, and took a look at one of the most valuable Total Wealth tools of all – the Put/Call Ratio. We covered actions you can take right now to maximize your returns.
I also promised you a look at one great trade in particular involving a current social media darling. Today I’d like to keep that promise.
If you’ve been with me for a while, you already know I don’t like social media stocks. They’re not hooked into our unstoppable trends (nope, not even Technology). Their products are “nice to have” instead of “need to have.” And most of them have no real way to make money.
But that’s the thing about tactics…
If you have the right trading tactics, you can squeeze profit out of any stock. Even ones you don’t like.
In this case, I think betting on one stock’s failure may be far more profitable than betting on its success.
I know that this may seem un-American or somehow unethical, but shorting a stock – that is, betting on its decline – is a killer tactic and can be a fabulously profitable tactic used to build your wealth.
That’s a tactic we’ve talked about, but if you’re not familiar with shorting, don’t worry. I’ve got you covered with a special sidebar in a few minutes. So let’s get back to the meat and potatoes.
Here’s the thinking and here’s why #ShortingTwitter is the only social media play I like right now…
Dec 12, 2014
Many investors are trying to time the markets, especially lately with concerns over low oil prices, global woes, and Chinese growth in the headlines.
I totally get where they’re coming from. The idea of picking market tops and bottoms is very seductive.
But they may as well try to catch falling knives…
The most recent DALBAR data shows that the return of investors trying to time the markets is a pathetic 1.9% a year over the past 20 years. Worse, they would have to be right a staggering 82% of the time just to match “buy and hold” returns, according to Nobel Laureate William Sharpe.
Clearly market timing is one tactic that does not build Total Wealth. But here’s the secret.
You’re much better off trying to understand sentiment – because that’s how you identify the best and the worst times to put your money to work and rack up the biggest gains.
Today I want to teach you how to do that…
When we started our time together here at Total Wealth, I identified six “Unstoppable Trends,” each of which has trillions of dollars behind it. I even went so far as to say that every dime you make for the next 10 years will be on that list of trends we’re tracking.
Energy is on the list, with good reason.
Global energy demand has increased every year since the beginning of time. It’s not just tied to human progress… it’s literally the fuel for it. No wonder it’s turned out more millionaires (and billionaires) than perhaps any other investing sector there is.
Yet in the last five weeks, something very unusual has happened.
Brent Crude – the most visible proxy for the state of energy markets – has dropped by more than 18% in just five weeks, going from $85.00 per barrel to a recent low of $69.50 per barrel, a four-year low. And the downturn is still in full swing, leading many investors to conclude that energy investing is a dead end.
You can certainly understand why they’d think that way… the Middle East is going up in flames, OPEC has started a badly miscalculated price war, and supply is plentiful, with the U.S. about to become the world’s largest petroleum producer thanks to fracking and shale.
I’ve gotten more than a few emails asking this:
Is energy is still an “Unstoppable Trend?”
Here’s my answer…
We’ve spent a lot of time in the past few weeks talking about how to maximize your investment returns.
But there’s another side to building wealth in the markets… keeping it.
If you’re thinking I’m going to launch into an article on “risk management,” that’s great, because it means you’re thinking like a market maven and that our time together is worth it.
But, actually, I’m not talking about risk management at all today.
I’m talking about five simple tactics – moves you can make right now – to legally minimize your bill come April 15th, 2015.
Most investors don’t pay nearly enough attention to this and, as a result, pay a terrible price down the line. I’ve heard every excuse in the book over the years as to why but really it comes down to two things: 1) they think it doesn’t matter unless you’re a 1%er or 2) that this is just a subject for high-powered CEOs with billions sheltered offshore.
That’s a shame because keeping more of what you make is a Total Wealth tactic that’s every bit as important as trailing stops, free trades, or even lowball orders – all of which we’ve discussed recently. Maybe even more so.
Dec 03, 2014
We’ve now explored two of our six “Unstoppable Global Trends.”
Our first one, Human Augmentation, was a subset of the Technology trend… and a knock-the-leather-off-the-ball kind of opportunity. It’s still very much that way, even though the little company I shared with you, EKSO Bionics Holdings Inc. (OTCBB: EKSO), doubled in a matter of weeks. Then we explored Standoff Warfare, part of the War, Terrorism, & Ugliness trend.
(We’ve also touched tactics with a look at Energy, taking advantage of a big dip in oil prices to deploy our lowball order on a big player in the sector, and Medicine, which we discussed during the Ebola scare.)
Today we have a perfect opportunity to explore Demographics…
Demographics is actually the first trend on my list, and that’s very deliberate. If you understand this line of thinking, you will naturally set up your portfolio for higher profits and lower risk because you will tap into the way the world works.
Then, I’d like to share a Demographics trade that is unique for three reasons:
- It’s the closest thing many investors will see to a “home run” in their investing lifetimes. That’s because the global variables driving it are irreversibly locked into place. In fact, I think this investment I’m about to show you could easily double from here.
- The biggest money on the planet is involved – more than $5.3 trillion a day – so with this trade, you’re going with the tide rather than against it. (To give you some perspective, the world’s equity markets trade less than $300 billion a day… so, roughly speaking, we’re talking about a trend that’s 16.7x bigger than the total transaction volume for every stock on the planet combined. )
- And finally, it’s backed by a government that refuses to lose.
I thought you might be… let’s get started.
Nov 26, 2014
The numbers are very clear when it comes to investing – the lower you buy, the higher you sell.
That’s why we’ve focused on so many tactics that get you a “discount” on your investment. It’s the best (and simplest) way to maximize upside. We’ve already talked about lowball orders, dollar-cost averaging, and buying puts – all very simple ways to buy lower and maximize your upside – and we’ll be exploring even more of those in the weeks to come.
But there’s one investment, one situation really, where you actually do want to pay more.
I know, I know. That’s akin to financial heresy.
This is the only time you’ll hear me tell you it’s okay to pay a premium for something in the pursuit of Total Wealth.
Look at this to see why…
Nov 19, 2014
This has been one of my favorite stocks for over 10 years.
I’ve called it a rock-solid investment, a powerful income play, and a global challenger that would be able to outmaneuver the competition to react to changing consumer preferences around the world. I’ve recommended it as a “BUY” twice to my Money Map Report readers, who had the chance to see great returns of at least 42.90%.
Just last year, I named it as one of just a handful of companies that could survive a U.S. sovereign debt crisis.
Even amid a 3.7% decline in August same-store sales, I remained bullish.
But even I can’t get past what just happened.
Here’s why one of America’s most iconic stocks just got kicked off my “BUY” list…
Nov 17, 2014
Gold has taken a tremendous beating in recent weeks and is now tumbling along at four-year lows of $1,160/ounce.
Things are so bad that you can actually buy the Central Fund of Canada Ltd. (NYSEMKT:CEF) – a popular gold and silver bullion investment vehicle – at a 10%-11% discount to the price of gold, because traders think the price of gold will drop even lower.
Frankly, I think that’s fantastic news.
Today I want to show you my secret “gold strike” strategy that’s perfect for moments like this. You’ll get the two tactics you need as a gold investor, a simple test to determine if you own enough gold, and a quick-and-dirty look at how to buy it.
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