Our ETFs

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ETF Model Portfolios

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Themes, Edges, and Asymmetrical Risk

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Investment Themes

Self Defense

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Interesting innovation here. Big believer that you are going to see more and more technology come out to allow people to defend themselves, hadn't thought about this.

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GUNZ

Politically Neutral

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Companies will never learn that it doesn't behoove them to get into politics. Add in the fact that the MAHA movement is trying to get Congress to act on things like "diabetes water" and you have a lot of risk in KO.

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Tough time believing this.....

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More than Two Thirds of Asset Owners Say ESG Factors Have Become More Material: Morningstar Survey-ESG Today

Completely agree with this though, once you go down that road you can easily end up in a bad place. The key is to find companies that never make these commitments in the first place and focus on their product or service instead.....

Backpedaling On ESG Commitments Will Inevitably Backfire-Forbes

BlackRock, Unilever, JP Morgan Chase— the list keeps growing when it comes to ESG backpedaling. And at a time when more eyes than ever are watching for slip-ups, not following through on commitments exposes a company to reputational risks.

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Yep. META is not one of the long term AI related names I hold, not sure they are going to be one of the AI winners. I do trade it in short term mean reversion strategies as there are edges there....

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Zuckerberg Admits He ‘Messed Up’ By Getting Too Involved in Politics-Daily Wire

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‍ESGX

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China

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Need to keep an eye on China. I trade FXI in short term mean reversion models but been a bit since I have held the Chinese names. They always seem to have a great way to break your heart, but have to keep an eye on what's going on......

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Hong Kong stocks lead global surge on reports of more China stimulus measures-MarketWatch

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AI Power Generation

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Meanwhile, everyone is continuing to talk about the AI power generation theme....

Energy Secretary Granholm Emphasizes Need For Small Modular Reactors To Power AI Data Centers-ZeroHedge

"They’re committed—telling us—to bringing that power with them, which is why the need for nuclear small modular reactors, colocating data centers with small reactors, or partnerships," Granhom said.

"For example, with Constellation and Microsoft for Three Mile Island to turn on more power. We’ve got a ton of nuclear sites in this country that have been permitted for additional reactors that could be powering data centers as well. We’re working with those."

I continue to add to my long term names on dips. Yesterday we added EMR and SHEL......

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There were other names I could have added, but seeing a lot of companies kicking around their 200 day moving averages so figure it's best to wait a bit and see how that plays out. The natural gas names specifically are all failing at their 200 days.

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This is one of the ones I have missed. Traded it a bit but should have held onto it long term. Interestingly, showed up on my short watchlist this morning. On the short side I like to short potentially extended pops for a quick reversal. Needs to go up again today for us to initiate a short, but still going to be on the lookout for a long entry.

Vistra’s stock is up more than 200% this year. Could more gains could be ahead?-MarketWatch

Stocks levered to nuclear power have done well recently on AI optimism. But an analyst notes that Vistra’s efficient gas plants could also be ‘a huge source of upside.’

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AI Chips

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Micron had earnings last night and is up over 15% this morning. Mentioned this in the newsletter yesterday and been talking about this name on The Watchlist. Just another example that you just have to be in these names.

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Micron surprises investors with strong guidance, sending stock soaring-MarketWatch

Micron Chief Executive Sanjay Mehrotra said in a release that artificial-intelligence demand “drove a strong ramp of our data-center DRAM products and our industry-leading high-bandwidth memory.” That refers to dynamic random-access memory.

As with any theme, you need to look at second and third order names. It's one thing to own the companies that make the chips, but who makes the products that those companies need?

Buy the stocks of these companies helping fuel the ‘AI gold rush,’ analyst says-MarketWatch

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Yang initiated coverage of the shares of Onto Innovation Inc. ONTO and Ultra Clean Holdings Inc. UCTT with outperform ratings. He set a $260 price target on Onto’s stock, which implies a 27% upside from current levels, while his $70 target on Ultra Clean shares suggests a 90% upside.

Interesting charts. UCTT had a day yesterday, but still way off the highs.

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ONTO had an undercut and rally at it's 200 day earlier in the month, then the 50 day.

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I trade the options on XLU in mean reversion strategies but longer term most of these sector ETFs suck. If you were to buy and hold one I would prefer UTES

Utilities Are the New AI Play—and the Stocks Can Keep Rising-Barron's

“This linkage to AI is one of the reasons the utility sector SPDR is the best-performing sector SPDR for the third quarter and why the Utilities Select Sector SPDR exchange-traded fund is outperforming the S&P 500 SPXand up more than 25% year to date,” writes Sevens Report’s Tom Essaye. “And, this trend appears to be sustainable.”

Crypto

For now these are all best designed for speculation, and were are definitely here to help with that.....

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MSTU

MSTZ

BTCL

BTCZ

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But keep an eye on this area, at some point it could move from speculative asset class to long term theme.

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Trump and Harris Want More Crypto Innovation. Yikes.-Bloomberg

Rate cuts are a guide to what digital currencies are actually good for: speculation.

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Argentina

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This guy has got to be pissing people off.....

Javier Milei Declares War At U.N. In Fiery Speech: ‘Long Live Freedom, Dammit!’-Daily Wire

Argentina President Javier Milei declared war on the global Left during a rousing speech at the United Nations this week where he announced that his country would no longer remain neutral and on the sidelines.

I got out of my Argentine stocks the other day. Many don't have options and the ones that do aren't that liquid so I didn't like the risk. ARGT looks toppy here, if we get a dip into some support areas I may have to get back in.

GGAL is a name that does have options.

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Edges

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No edges in bonds.....

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Bond ETF flows this year just topped annual record set in 2021-MarketWatch

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