THE IMPORTANCE OF MACRO

THIS WEEK: Bitcoin, AMSL, Advanced Micro Devices, Coherent, ARM and the failed approach to diversification.

THE IMPORTANCE OF MACRO: It is extremely important to learn and understand global macro. Majority of a stock’s movement can be explained by the “big-picture” story, while company-specific movements only account for a fraction of their move. Most dumb sheep analysts & “investors” on Wall Street are trained with a bottom-up mindset which can lead to a lot of confusion when macro forces take over markets.

DIVERSIFICATION tends to work well when you don’t want it to (during rallies), but it fails to protect us during downturns. This challenges the traditional investment strategy of diversification, highlighting the need for a more nuanced approach to managing portfolio risk, especially in volatile markets.

Small-caps have done NOTHING since 2020 besides diminish returns. Failing to diversify.

EM has done NOTHING since 2020 besides diminish returns. Failing to diversify.

Internals are continuing to deteriorate.

Equal weighted S&P has done NOTHING since 2022. Failing to diversify.

We’ve been bullish Bitcoin since $27 in 2013. Going higher or to zero. Nothing in between.

The gap will close.

ARM: You think the FTC blocked the NVDA merger for nothing? This is a powerhouse of a company.

AMD continues to base.

ASML: Just like we said before, it is the GATEKEEPER OF AI. New Highs.

Follow Druckenmiller on Coherent: “Upside for Optical Suppliers: Nvidia didn’t order enough transceivers at least in the April quarter so the set up feels good for both Optical suppliers (e.g., Fabrinet, Coherent, Innolight). - JPM TMT Conference

BofA is starting to think AI is a bubble. They are WRONG.

Return always wants its risk payment.

NOT INVESTMENT ADVICE. Only for entertainment.