🧵Speculative trade ideas for 2022Q4 and beyond:
🚧work in progress🚧
"CHEAP AMAZONS"
BIGCAPS OUTLIERS
CHINA REOPEN
COAL US & INTL
CRYPTOS
DOLLAR
EARNINGS RECESSION
ENERGY-DRIVEN INFLATION *US/EU*
ENERGY SHOCK / SHIFT
FERTILIZERS
FRAUD & BULLSHIT
HIGH INTEREST RATES
🚧work in progress🚧
"CHEAP AMAZONS"
BIGCAPS OUTLIERS
CHINA REOPEN
COAL US & INTL
CRYPTOS
DOLLAR
EARNINGS RECESSION
ENERGY-DRIVEN INFLATION *US/EU*
ENERGY SHOCK / SHIFT
FERTILIZERS
FRAUD & BULLSHIT
HIGH INTEREST RATES
https://twitter.com/AndorraInvestor/status/1496795007726010370
LNG / NORDSTREAM
MACRO, SAFE VS SEXY
METALS
PEACE
PMI'S SHARP DECLINE
STAR COUNTRIES
UKRAINE'S CROPS
VALUE CYCLE FRONT RUN
VOLATILITY
WAR ESCALATION
WATER & LAND
WORLD WIDE FOOD SHORTAGE
Pls, let me take time to develop in the coming days and share with you as I progress...
MACRO, SAFE VS SEXY
METALS
PEACE
PMI'S SHARP DECLINE
STAR COUNTRIES
UKRAINE'S CROPS
VALUE CYCLE FRONT RUN
VOLATILITY
WAR ESCALATION
WATER & LAND
WORLD WIDE FOOD SHORTAGE
Pls, let me take time to develop in the coming days and share with you as I progress...
"CHEAP AMAZONS"
In the present environment, there could be the opportunity to find the next Amazon/Apple/Microsoft, etc. at a cheap price.
Companies that although not profitable could be now at one of their lowest valuations compared to both past and future
$DNA
$NET
$PLTR
$UBER
In the present environment, there could be the opportunity to find the next Amazon/Apple/Microsoft, etc. at a cheap price.
Companies that although not profitable could be now at one of their lowest valuations compared to both past and future
$DNA
$NET
$PLTR
$UBER
BIGCAPS CORRELATIONS
In this bear market, the last to fall are the "Nasdaq Generals" a group to which I'm adding Tesla.
If the bear market continues, this could add an extra layer of profitability to a SHORT position.
Breaking the correlations with the rest:
$AAPL
$AMZN
$TSLA
In this bear market, the last to fall are the "Nasdaq Generals" a group to which I'm adding Tesla.
If the bear market continues, this could add an extra layer of profitability to a SHORT position.
Breaking the correlations with the rest:
$AAPL
$AMZN
$TSLA
CHINA REOPEN
The feedback that I'm getting from my China contacts is not very optimistic, but logic dictates that every day that goes by gets China closer to re-opening.
Once OPEN even in a global recessionary environment, a sector like tourism would get better YoY earnings
$TCOM
The feedback that I'm getting from my China contacts is not very optimistic, but logic dictates that every day that goes by gets China closer to re-opening.
Once OPEN even in a global recessionary environment, a sector like tourism would get better YoY earnings
$TCOM
COAL US & INTL
Obvious play and, from my speculative operation list, one of the most unidirectional.
But I'm re-exploring the story to find some hidden gems, maybe Colombia is the way to go. But I don't have objective companies to analyze, so far my list is quite basic:
Obvious play and, from my speculative operation list, one of the most unidirectional.
But I'm re-exploring the story to find some hidden gems, maybe Colombia is the way to go. But I don't have objective companies to analyze, so far my list is quite basic:
$BTU
Have been long for a while, selling covered calls for extra money juice.
$WHC:ASX
$HNRG
$DTE
$CCTC
$AMR
$HCC
$ARCH
$METC
$CEIX
$NC
Researching Colombian Coal atm, any suggestions?
Have been long for a while, selling covered calls for extra money juice.
$WHC:ASX
$HNRG
$DTE
$CCTC
$AMR
$HCC
$ARCH
$METC
$CEIX
$NC
Researching Colombian Coal atm, any suggestions?
CRYPTOS
In my opinion, Ethereum is the way to go.
We could be expecting further adoption by some countries in order to fight inflation.
The technology is incredible, but there are way too many 🤡 in the crypto space.
Maybe I should take it into account as L/T and forget M/T
In my opinion, Ethereum is the way to go.
We could be expecting further adoption by some countries in order to fight inflation.
The technology is incredible, but there are way too many 🤡 in the crypto space.
Maybe I should take it into account as L/T and forget M/T
DOLLAR
With its continuous strength increase, it's causing way too much havoc internationally, pressure downwards will increase. But I'm starting to realize that the present trend will keep on going until the Fed pivots.
I'm trying to assess if I'm too late to the party.
With its continuous strength increase, it's causing way too much havoc internationally, pressure downwards will increase. But I'm starting to realize that the present trend will keep on going until the Fed pivots.
I'm trying to assess if I'm too late to the party.
The market is missing that what will happen once the Fed pivots will be a change in the USD trend, not the immediate market reversal (#Hopium^∞), which is just a false narrative.
But my big miss was an obvious unidirectional USD play, is it too late?
But my big miss was an obvious unidirectional USD play, is it too late?
https://twitter.com/AndorraInvestor/status/1578622114084827136?s=20&t=BCcpk1XPAE5KbqHJ-yK3qA
EARNINGS RECESSION
This is the most complex and crucial point in my whole speculative outlook for the next months.
I have been convinced for a while that starting in Q3 we would enter ER territory, but I keep revising my theories in case I missed something.
This is the most complex and crucial point in my whole speculative outlook for the next months.
I have been convinced for a while that starting in Q3 we would enter ER territory, but I keep revising my theories in case I missed something.
I see US consumer strength as the main pillar holding sales and earnings, with positive forces affecting it:
+ Lower Wages increase provides real trickle down.
+ Sept YoY wages close / above CPI increase YoY
Job-stayers 7.8%
Job-changers 15.7%
h/t @BlacklionCTA
+ Lower Wages increase provides real trickle down.
+ Sept YoY wages close / above CPI increase YoY
Job-stayers 7.8%
Job-changers 15.7%
h/t @BlacklionCTA
Which reinforces the present job-market tensions, since the only way for employees to maintain purchasing power against inflation is to change jobs.
But August JOLTS report points to the sharpest decline since COVID which could indicate that the trend is reversing.
But August JOLTS report points to the sharpest decline since COVID which could indicate that the trend is reversing.
So to summarize on Earnings Recession, I see it as likely probable with several unrelated but reinforcing narratives adding pressure to it.
I will use it as my main macro scenario, with a further -20% to -30% on SPX, even reaching PANIC mode once we get to CREDIT CRISIS level.
I will use it as my main macro scenario, with a further -20% to -30% on SPX, even reaching PANIC mode once we get to CREDIT CRISIS level.
ENERGY-DRIVEN INFLATION *US/EU*
ENERGY SHOCK / SHIFT
Energy market tensions are increasing.
But lower demand due to recession, windfall taxes, price controls, or further sales of SPR worry me as a countermeasure by governments to fight energy-caused inflation.
ENERGY SHOCK / SHIFT
Energy market tensions are increasing.
But lower demand due to recession, windfall taxes, price controls, or further sales of SPR worry me as a countermeasure by governments to fight energy-caused inflation.
I think that the most unidirectional speculative trade
is in ENERGY INFRASTRUCTURE & TRANSPORT.
Which would also benefit from further escalations in international conflicts or, if governments finally think strategically, an increase in energy independence and supply capacity.
is in ENERGY INFRASTRUCTURE & TRANSPORT.
Which would also benefit from further escalations in international conflicts or, if governments finally think strategically, an increase in energy independence and supply capacity.
I'm considering:
$GLNG
Cool Company ($HQ3:FRA)
$TELL but ⚠️
$MLPX
Etablissements Maurel et Prom SA ($MAU:EPA)
$OIH 👇
seekingalpha.com/article/454562…
$GLNG
Cool Company ($HQ3:FRA)
$TELL but ⚠️
$MLPX
Etablissements Maurel et Prom SA ($MAU:EPA)
$OIH 👇
seekingalpha.com/article/454562…
FERTILIZERS
Classical INELASTIC SUPPLY + DEMAND SHIFT speculative operation. Plus, fertilizers demand will not be affected if the global recession confirms (energy will), and the tensions with Russia will exacerbate the problem.
Classical INELASTIC SUPPLY + DEMAND SHIFT speculative operation. Plus, fertilizers demand will not be affected if the global recession confirms (energy will), and the tensions with Russia will exacerbate the problem.
Considering:
$LXU
$UAN
$NTR
$OCI:AMS
$MOS
$BSM
$CF
$CVI
All of them in my radar for a while 👇
$LXU
$UAN
$NTR
$OCI:AMS
$MOS
$BSM
$CF
$CVI
All of them in my radar for a while 👇
https://twitter.com/AndorraInvestor/status/1496795007726010370?s=20&t=B08_GcJy4ljNvXdTSJGisw
FRAUD & BULLSHIT
This is by far my favorite speculative operation, and it is ideal for the current market situation.
Once sales start to go down and credit dries up even good companies will suffer, Fraud & Bullshit companies have ZERO chance of survival.
This is by far my favorite speculative operation, and it is ideal for the current market situation.
Once sales start to go down and credit dries up even good companies will suffer, Fraud & Bullshit companies have ZERO chance of survival.
Credit goes to:
@blue_chip1 @yoloption @BradMunchen @jabe8
@DonutShorts @AnadarkoCapital
They are a great inspiration in the pursuit of bullshit valuations!
In my opinion:
$CVNA a classic!
$FFIE
$AMRS
$CACC
$AMC / $APE
$NKLA
$BLNK
$LCID
$RUN
$PLUG
$LWLG
$DWAC
What am I missing?
@blue_chip1 @yoloption @BradMunchen @jabe8
@DonutShorts @AnadarkoCapital
They are a great inspiration in the pursuit of bullshit valuations!
In my opinion:
$CVNA a classic!
$FFIE
$AMRS
$CACC
$AMC / $APE
$NKLA
$BLNK
$LCID
$RUN
$PLUG
$LWLG
$DWAC
What am I missing?
HIGH INTEREST RATES
This could be viewed as the typical INELASTIC SUPPLY speculative operation, in which the "commodity" increases in price, in this case, money & financing are becoming more expensive, and it will cause a ripple effect in the market that are not all priced in yet
This could be viewed as the typical INELASTIC SUPPLY speculative operation, in which the "commodity" increases in price, in this case, money & financing are becoming more expensive, and it will cause a ripple effect in the market that are not all priced in yet
Like with any other higher sigma movement, there is an opposite force building up, but I believe that the delayed effect of interest rate in fighting inflation will play in favor of higher interest rates for longer, at least for 2022-2023.
On the importance of the present interest rate hike movements, in my Z-SCORE σ indicator the increases reached beyond 5-sigma (5 standard deviations from average), the HIGHEST LEVEL ON RECORD.
In other words, nobody knows what will happen next, since there is no historical record of anything similar.
But seems obvious that the following sectors will be affected and possibly for longer than the rate hike itself:
Housing
Durable goods
Financing
International currencies
But seems obvious that the following sectors will be affected and possibly for longer than the rate hike itself:
Housing
Durable goods
Financing
International currencies
Financing:
Banks, as Drukenmiller has pointed out in several of his interviews, the effect is bidirectional, higher interest rate means banks have "more margin" but also means that the economy is screwed, so no interesting.
Banks, as Drukenmiller has pointed out in several of his interviews, the effect is bidirectional, higher interest rate means banks have "more margin" but also means that the economy is screwed, so no interesting.
Housing and Durable goods:
Uni-directional 👉 PAIN
The list of companies is huge, so I will try to either go with general etf $XHB (been short for a while, already) or when time permits I will try to filter companies with struggling cashflows during 2021 bull market $CVNA
Ideas?
Uni-directional 👉 PAIN
The list of companies is huge, so I will try to either go with general etf $XHB (been short for a while, already) or when time permits I will try to filter companies with struggling cashflows during 2021 bull market $CVNA
Ideas?
International currencies, bonds, liquidity products, etc... I'm out of it, I do not understand enough.
LNG / NORDSTREAM
I'm trying to understand the implications of reduced LNG supply to Germany beyond what's obvious.
I'm thinking of the chemical and glass industries, and the obvious previously mentioned Energy Infrastructure and Coal possible speculative operations.
No time.
I'm trying to understand the implications of reduced LNG supply to Germany beyond what's obvious.
I'm thinking of the chemical and glass industries, and the obvious previously mentioned Energy Infrastructure and Coal possible speculative operations.
No time.
MACRO, SAFE VS SEXY
Having said that, I believe that the 2022-2023 macro trend is down, evolving from Lower Multiples to Earnings Recession to possibly Credit Crisis.
I don't believe that we will reach the bottom of the bear market in a straight line, and here comes my dilemma:
Having said that, I believe that the 2022-2023 macro trend is down, evolving from Lower Multiples to Earnings Recession to possibly Credit Crisis.
I don't believe that we will reach the bottom of the bear market in a straight line, and here comes my dilemma:
"SAFE"
Buy long-dated, $SPY PUTS, bought at decent VIX levels, and do nothing till 2023.
"SEXY"
Buy 90-60days expiry $SPY PUTS, bought every VIX drop or BMR, and sell at every > 2 sigma movement.
I will probably go for SEXY.
Buy long-dated, $SPY PUTS, bought at decent VIX levels, and do nothing till 2023.
"SEXY"
Buy 90-60days expiry $SPY PUTS, bought every VIX drop or BMR, and sell at every > 2 sigma movement.
I will probably go for SEXY.
METALS
I keep hearing about Silver, Copper, Platinum, etc...
I understand that the low inventories add upwards pressure to the price, but China's % of Global Demand is way too high, for the prices not to suffer further if China's Construction sector suddenly halts as it is.
I keep hearing about Silver, Copper, Platinum, etc...
I understand that the low inventories add upwards pressure to the price, but China's % of Global Demand is way too high, for the prices not to suffer further if China's Construction sector suddenly halts as it is.
PEACE
I don't see it as an immediate possibility, and even if it was, any speculative trades based on PEACE happening would be gambling, and I only gamble when the odds are in my favor, with PEACE it's just 50/50.
I will only consider it as a possibility against my trades.
I don't see it as an immediate possibility, and even if it was, any speculative trades based on PEACE happening would be gambling, and I only gamble when the odds are in my favor, with PEACE it's just 50/50.
I will only consider it as a possibility against my trades.
PMI'S SHARP DECLINE
It overlaps with my Earnings Recession, so nothing new. I will keep track to reinforce or not my macro scenario.
It overlaps with my Earnings Recession, so nothing new. I will keep track to reinforce or not my macro scenario.
STAR COUNTRIES
I think the Indian stock market will be what the Chinese never was. The fact that so many US CEOs are of Indian origin (and not Chinese) points to cultural richness and alignment with US entrepreneurship and business values.
People & Culture = BL/T Results.
I think the Indian stock market will be what the Chinese never was. The fact that so many US CEOs are of Indian origin (and not Chinese) points to cultural richness and alignment with US entrepreneurship and business values.
People & Culture = BL/T Results.
I'm still exploring what instrument to use in order to invest in India, ideally hand-picking best looking companies, otherwise general etf like $INDA
I will also monitor the Indian market as a possible Macro Leading Indicator, but that's a "working theory" not a "theory working"
I will also monitor the Indian market as a possible Macro Leading Indicator, but that's a "working theory" not a "theory working"
As for other possible "STAR COUNTRIES", I would consider Colombia and some other South America candidates. But India seems far superior in any metric, besides natural resources.
UKRAINE'S CROPS
Climate change, war escalation, the possibility of Nuclear attack or a radioactive accident, create an upwards pressure only scenario.
Wheat and Corn, at good entry price levels.
Climate change, war escalation, the possibility of Nuclear attack or a radioactive accident, create an upwards pressure only scenario.
Wheat and Corn, at good entry price levels.
https://twitter.com/AndorraInvestor/status/1576870635288264704?s=20&t=hctE5r6CtGtfejVDeGjvbA
VALUE CYCLE FRONT RUN
@hkuppy and @michaeljburry point out the narrative that value stocks should front-run the market recovery.
I'm back-testing that theory, which is not an easy task, since the oldest Value Indexes I can find were created in 1993.
@hkuppy and @michaeljburry point out the narrative that value stocks should front-run the market recovery.
I'm back-testing that theory, which is not an easy task, since the oldest Value Indexes I can find were created in 1993.
So far their Value Cycle Front Run theory does not hold, but I trust their vision and value their track record, so I will keep back-testing and will have it as a possible leading indicator signaling the market reversal.
VOLATILITY
Again it seems to me like another uni-directional mostly upward speculative scenario.
The amount of tension that the market is accumulating could result in an explosive movement soon.
Again,
EXPLOSIVE
MOVEMENT
SOON
Again it seems to me like another uni-directional mostly upward speculative scenario.
The amount of tension that the market is accumulating could result in an explosive movement soon.
Again,
EXPLOSIVE
MOVEMENT
SOON
I'm mainly considering VIX options, but I'm still doing further research to find the ideal instrument structure in order to minimize risk/return.
Learning form:
@BankofVol
@ZeContrarian7
@michaellistman
Learning form:
@BankofVol
@ZeContrarian7
@michaellistman
WAR ESCALATION
Overlapping with several other speculative operations I listed, I will keep it in mind in case I'm missing something. Suggestions?
Overlapping with several other speculative operations I listed, I will keep it in mind in case I'm missing something. Suggestions?
WATER & LAND
Climate change, food shortage energy independence & money printing make it a perfect L/T speculative operation/investment.
On LAND, I'm looking at similar things to $TPL 💕
On WATER, although I need to filter🤣:
$ERII
$CWCO
$WAVE
$WAAS
Climate change, food shortage energy independence & money printing make it a perfect L/T speculative operation/investment.
On LAND, I'm looking at similar things to $TPL 💕
On WATER, although I need to filter🤣:
$ERII
$CWCO
$WAVE
$WAAS
WORLDWIDE FOOD SHORTAGE
Overlaps w/ other speculative operations and is reinforced by several trends with strong momentum atm.
Following:
$ICL
$SQM
$CTVS
$CORN
$WEAT
$DBA
An evolution of this operation could be to bet on country turmoil and social unrest 👀
THE END
Of round #1
Overlaps w/ other speculative operations and is reinforced by several trends with strong momentum atm.
Following:
$ICL
$SQM
$CTVS
$CORN
$WEAT
$DBA
An evolution of this operation could be to bet on country turmoil and social unrest 👀
THE END
Of round #1
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