The first quarter in the markets has been anything but dull.

We've seen volatility in interest rates, Federal Reserve rate hikes, and a mini-banking crisis, but we've still weathered the storm. We are as optimistic as ever, but also with the understanding the prices may not move up in a straight line from here.

The opportunities both in growth stocks and in fixed rate securities are still plentiful, but we see interest rates starting to fall, which means the chance to lock in 7-8% annual return in quality corporate bonds won't be here for much longer.

Take a listen to our first quarter review and the thoughts of CEO Noland Langford and Director of Research, Brian Dress, for the rest of 2023 (and beyond). We welcome your thoughts in the comments and we'd be happy to answer any questions.

If you still have cash sitting in the bank, now is the time to act to get something locked in with a higher return for a longer duration. Reach out and we can set up a time to talk in more detail!

Topic 1: First Quarter in Review

Topic 2: Outlook for the Rest of 2023 (and Beyond)

Have you ever found yourself completely absorbed in a game, losing track of time as you strive to reach the next level or unlock a new achievement? If so, you've experienced the power of gamification.

Gamification is the practice of using game mechanics and psychology to engage and motivate people to achieve their goals. By tapping into our innate desire for competition, achievement, and reward, gamification can drive increased engagement, loyalty, and revenue.

But gamification is not just for games. It can be applied across a wide range of industries, from fitness apps to stock trading platforms. In this post, we'll explore the pros and cons of gamification, look at some successful examples of gamification in action, and provide tips for how to design an effective gamification system for your business.

I used Chat GPT to help me compile my full post which you can find here, but here's an example of one of the companies profiled that is successfully utilizing gamification (and it's a company that I did a full write-up on once-upon-a-time, $RBLX.

Roblox Corporation is a massively popular gaming platform that utilizes gamification techniques to keep its over 150 million monthly active users engaged. The platform allows users to create their own games and experiences, share them with others, and even monetize them. Since its initial public offering (IPO) in March 2021, Roblox's stock price has risen steadily, making it a highly profitable company for investors. Its shares were priced at $45 during the IPO and have since risen to over $100 as of March 2023. Incorporating gamification techniques into business models can be highly effective in increasing engagement and profitability. Companies can learn from successful examples like Roblox and tailor their own offerings to include rewards and incentives for users. By doing so, they can not only enhance the user experience but also drive growth and revenue for their business.

Full $RBLX post here:

https://commonstock.com/post/7a87136f-3ea8-4432-85fd-8d01e0153405 by @sidnistandard

"Through its newly established Google Cloud Studio, a new business unit, Globant will grow its dedicated team of experts with deeper and wider reach in Google Cloud Platform products. This new studio will leverage the wide range of Google Cloud tools to benefit organizations across all verticals in their business transformation."

The bullet points from the press release (which I've linked below)

As part of the expanded partnership, Globant, and Google Cloud will also work together to:

Source: https://investors.globant.com/2023-03-30-Globant-Expands-Global-Partnership-with-Google-Cloud-by-Creating-a-New-Dedicated-Google-Cloud-Studio

Good morning contrarians! Stock futures are moving higher as bonds sell off ahead of the Fed’s preferred inflation reading, out at 0830.

So it’s hard to see how this reading, the PCE Deflator, will make much of an impact however. It’s dated information and the market has moved on. Of course, the events that seemed so transformative just one week ago have now themselves kind of faded. Indeed we are officially back in bull market territory for tech stocks, this after one year and about three weeks of a bear market:

More on the state of play here:

The beauty of the John Wick franchise is that each movie becomes more popular than its predecessor. That type of growth is rare in entertainment and it's the type of growth that signifies a franchise with immense potential down the road. Many of the new John Wick fans got into the franchise since the pandemic and have waited a long time for this movie to come out.

Internationally, the film has made more than $150 million. Have you seen John Wick: Chapter 4?

Rule #4 on my rules of personal investing is to constantly keep learning. I was fortunate to be forced to do this as I worked in many different asset classes in many different countries

A skill that has helped me try to consolidate the thinking is the intermarket analysis learned in the CMT examination process. We can learn from the drivers of the flows of money in the various corners of the market. We may spot early trends or outliers

For instance, consider the chart today. I have on here the US 30 year yields (inverted) in orange. I compare to the NDX outperformance of SPX in white, Bitcoin in blue and the ratio of copper to gold in purple.

Many if not most of you may be thinking that I have lost the plot and these assets or ratios have little to do with each other. However, a view of them over the last 18 months suggests perhaps there is a common thread. Spurious correlation? Maybe, maybe not.

You see, the concern over the last 18 months has been inflation, and the central bank response to inflation. As central bankers realized inflation was not transitory, they were forced to raise rates aggressively. This happened globally even though the Fed gets the media buzz.

Going into this period, we had a bubble in duration. Free money in the form of 0 interest rates combined with fiscal & monetary stimulus post Covid led to a sharp rise in long duration assets in every asset class.

This unwound as rates rose. We clearly see this in the 30 year which is where most focus on duration. However, NDX stocks are longer duration than SPX & we saw it here. Crypto, especially Bitcoin, is very long duration as there are few cash flows.

Copper to Gold ratio is the commodity mkts measure of global growth. It also fell as rates rose with commodity traders anticipating a global growth slowdown. That helps describe late 2021 and all of 2022 but what about now?

We see NDX meaningfully beating SPX. We have even seen Bitcoin move off the lows. Have we seen duration in bonds keep up? Not really. Bond seem to suggest inflation may drop near term but could be a problem longer term still

Maybe this is driven by global growth expectation then. Is copper outperforming gold? Not at all. In fact quite the opposite. Commodity mkts seem more concerned about a recession than stocks

What does this mean? Is the NDX more clued up than these other mkts? Or are equity investors forcing the idea a little too much? I will let you decide, but I think you know my answer.

There is much we can learn from other investors, even those in other asset classes. It is important to keep learning.

Stay Vigilant

#markets #investing #stocks #bonds #cryptocurrency #commodities

+3.04% gain for the day

+5.19% gain for the week

+8.01% gain for the month

+26.02% gain YTD

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Recap for March 2023

Sold $DDOG and $ZS

Bought $ENPH and $PAYC

Daily adds to $O and $SCHD

So found this interesting read where Risk.net wrote a piece on how Citadel keeps beta returns at bay. Made me curious about looking some stuff up over the weekend.

For those that wanted a more humourous summary, here's the laydown written in style for regards:

Too bad in the recent recession, all of my long plays that worked out were just going long oil.

A short & light earnings week next week marking the start of the second quarter of the financial year next week.

Q1 earnings season starts mid-April.

$DGLY $SWKH $AYI $MSM $FRLN $CAG $SMPL $DLO $KRUS $SGH $SCHN $SMPL $STZ $LW $RPM $LEVI $WDFC

Don’t forget to check out my Substack. I’m dropping a post today :

Just topping up my counters.

Rule #5 in my personal rules of investing is to help others. This is the entire raison d'etre of my Chart of the Day after all. It is also why I decided to get into teaching

However, it extends beyond that and there is something for all of us to take from it. It means to help others in your workplace too. If you help new employees learn & get up to speed, others will see that and help your career advance too

It also extends to the role of sales and fund-raising. In sales, if you make your client look smarter by helping them get information they need, they will pay it back in spades. Ditto if you help someone at an asset owner you are asking for money from

There is even a broader goal too. I teach a class this semester on ESG Investing. I follow the CFA Institute certificate in ESG Investing curriculum. There is a great deal of debate & politicism on the topic now

For example, Utah State Treasurer Marlo Oaks claimed that ESG investing is a part of “Satan’s plan.” Even Elon Musk is no fan, having tweeted: “ESG is the devil.”

ESG Investing, straight from the curriculum, focuses on the UN Sustainable Development Goals in the chart today. They are such controversial topics such as No Poverty, Zero Hunger, Quality Education, Gender Equality, and Clean Water & Sanitation. Satanic? C'mon

The Treasurer doubles down: "ESG promotes and implements policies through private businesses that could be adopted through a legislative process,” Oaks said in an interview last year.

It is now a BAD thing that we want the private mkt to find solutions to issues? We are at the point where we can only do things by legislation? Even though Congress seems to have abdicated all power to the Executive Branch?

Chapter after chapter, podcast after podcast in my class we hear people speak about how action led by consumers, employees and companies has more lasting power. If it needs to be mandated, people only go there begrudgingly & it is less effective

Finally, please know ESG Investing is NOT exclusionary. There are some investors that exclude stocks or sectors but this is NOT ESG Investing. ESG Investor integrate these goals into their process. The goal of CFA Institute is to get this type of integration to be standard. ESG is NOT the Socially Repsonsible Investing (SRI) of the 80s.

ESG is also NOT just environment. Look at the goals. 5 of the 17 are environmental. There are far more social goals like No Poverty and Income Inequality. ESG is not green or woke. It ties back to Natural Law that has guided society for centuries

The bottom line goal? Help others. Controversial? I don't think so

Stay Vigilant

#markets #investing #esginvesting #unsdg

$MSFT Exactly as I said a month ago. Chatbots will be monetized via subscriptions/ads/per query pricing (for enterprises)

Now Microsoft’s Bing Chatbot is getting ads https://www.theverge.com/2023/3/29/23662476/microsoft-bing-chatbot-ads-revenue-sharing and is exploring ways to pay content creators for content it utilizes https://www.windowscentral.com/software-apps/bing/heres-how-bing-chat-may-pay-publishers-it-cites-as-sources

Which goes to show chatbots ARE NOT a headwind to Google, because they are equally, if not even better monetizable when perfected given a more accurate intent for result, and therefore more accurate ads served.

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Latest data: March 29th 2023

TLDR: Last week, the Fed added $314m net to its Treasury security holdings and trimmed $7bn net from its mortgage-backed security (MBS) holdings. The total amount of Reserve Bank credit rose by $38bn net.

I also share this weekly update as a Twitter thread if you prefer.

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Big week for Disney $DIS this week:

Increased my position by 20% of $TSN

Long Tyson Foods 🐄

The past month has been an adrenaline rush for investors and the general public. The sudden demise of Silicon Valley Bank (SIVB) must send chills through the spine of regulators, not because of SIVB and SBNY, but because the unregulated, uncontrollable weed of shadow bankers are more dangerous and are lurking in the shadows — they threaten the existence of the global economy.

We are thirteen weeks into 2023; inflation is rocking the guts of all the over-leveraged, underperforming, and subsidy-hungry corporations and consumers alike. For years companies in technology, “fin” tech, Electric Vehicles, and others enjoyed easy capital. However, thanks to the rock-bottom rates, we have seen companies like CVNA, GOEV, OPEN, and more fall more than 90% of its IPO price.

Eighteen months ago, the online used car retailer Carvana had such great prospects that it was worth $80 billion. Now it is valued at less than $1.5 billion, a 98 percent plunge, and is struggling to survive.

Central bankers reiterated that they’re not done raising interest rates (even if market participants don’t fully believe it), together with a slowing economy that has led companies and consumers to spend less — a move toward austerity that tech companies have now embraced, after years of rocketing head counts and cushy perks to retain employees.

Many other tech companies are shedding employees, cutting back, and watching their financial valuations shrivel — even as the larger economy chugs along with a low unemployment rate.

One largely unacknowledged explanation: An unprecedented era of rock-bottom interest rates has abruptly ended. Money is no longer virtually free.

Since our inception, our theme has been consumer credit and fundamental corporate weakness.

Investors and consumers must remind themselves that in times of financial stress, events can come out of nowhere that bring down economies - as the British saw last year - governments as well.

$CACC $PRAA $TREE $SYF $BFH and more....

$SKY Skyline Champion Corporation today reached a 52-week high.

A possible explanation of this is the market reaction to the collaboration of Champion Homes and Quartz properties for the development of an innovative build-for-rent community in Asheville (source: Business Wire).

74 homesites are not significant but the shift to build-for-rent is expected to drive further adoption of manufactured houses in the homebuilding space.

Do you want to learn more about $SKY or do you want to see if we covered this opportunity in the write-up we released on Feb? 👇