Good morning contrarians! Stock futures are dropping a bit in the pre-market after Friday’s rally. That’s actually a good sign, assuming we’re in a bear market…

It’s a big week for retail, with tomorrow’s census bureau report and earnings from $WMT, $HD and others.

That’s not until tomorrow though. For now get caught up on what’s shaping markets here:
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$3.8m follower assets
A lot going on for a Friday... 54 positions increased/started
Three things going on with my portfolios today.

1) additional stock investments into my Stash portfolio

2) setup of a special REIT portfolio on M1 Finance to benchmark the various Real Estate apps I am evaluating.

3) updated Real Estate Rumble to incorporate the Fat Cat Investing REIT Pie from M1 Finance

1) - Stash Investments (6)

$AEO - $29.09 consensus price target. DCA down from previous buys.
$CHWY - $59.04 consensus price target. DCA down from previous buys.
$COIN - $270.77 consensus price target. DCA down from previous buys.
$HD - $387.95 consensus price target. DCA down from previous buys.
$NFLX - $345.57 consensus price target. DCA down from previous buys.
$WRBY - $37.67 consensus price target. DCA down from previous buys.

2) - M1 Investments (48)

I added a "benchmark" made of 48 REITs pulled from the "Seeking Alpha iREIT Durable Income Portfolio to my Real Estate Rumble Google Doc. Rather than setup a whole new account for this, I added an additional "pie" to one of my M1 portfolios...

I'm not going to list all 48 holdings here but you can see them here - Fat Cat Investing Pie: https://m1.finance/z6spRMse6EOm

3) - Real Estate Rumble

Newly revised "Real Estate Rumble" now tracking Concreit, Landa, Lofty, Fundrise, Groundfloor + Fat Cat Investing M1 REIT pie.

Real Estate Rumble Google Doc - https://bit.ly/3J4U57h

Join me at Fat Cats of Real Estate on Facebook - https://www.facebook.com/groups/447646870455159
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Highs & Lows Weekly #7
Commentary on Current Trends
  • There are almost no stocks showing up on the strong short term list. The market is indiscriminately selling almost everything, even the industries that had been holding up well in recent weeks.

  • The weak short term list is more than 10 times larger than the strong short term list. Again, long duration equities (biotech, software, internet, etc) dominate the list. Note also that industries that had been strong in recent weeks are turning negative - Gold, resources, oil and gas, etc.

  • Defensives - Utilities, REITs, Consumer Packaged Goods - remain in strong long term uptrends despite recent near term selloffs. The market has fled into these names as a defensive reaction to a risk off environment.

  • The selloff in debt markets has weighed substantially on financial stocks. The yield curve has flattened significantly, which has led investors to begin selling bank stocks. Also, the recent increase in mortgage interest rates bodes poorly for mortgage origination and refinance at major lenders.

  • Some of the largest and most well thought of companies in the market now sit atop the weak long term trend list. This includes: $FB, $TSM, $JPM, $HD, $BAC, $DIS, $CSCO, $ADBE, and $CRM. The market has finally “come for the Generals” of the market after selling small and midcap stocks for nearly a year.

For more insight into what stocks are trending up/down be sure to check out our latest edition of Highs & Lows Weekly!

Credit Markets and Financial Conditions
There has been a reasonable degree of damage beneath the surface on a stock-level; credit markets, however, have not shown the same degree of uncertainty.

In an interview with Bloomberg TV, former New York Fed President Bill Dudley mentioned the lack of cooperation by financial markets; in other words: the Fed isn't seeing the type of sea change it would like to see in order for a reverse wealth effect to kick in.

Just how much the Fed will be able to tighten financial conditions will likely depend on market signals such as the GS Financial Conditions Index and Corporate High Yield OAS.

If we were to look at specific stocks that are highly sensitive to credit conditions: homebuilders, do-it-yourself outlets ($HD $LOW), banks ($JPM, $C, $GS) as well as private equity transactions financed via debt offers -- there are many more.

I hesitate to paint a doom & gloom scenario; it is, however, valuable to keep an eye on the tone of credit markets and be aware of sub-surface dynamics.

Goldman Sachs Financial Conditions Index

Corporate High Yield OAS
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I know @austin recently opened up a $LOW position with a strong case, and has also discussed $HD. I have no skin in the game currently but I think the backdrop conditions of home buying, building/renovating, mixed with recession fears and credit market conditions makes for an especially interesting story.

I feel as though it is either an excellent time to buy these names or a horrific time to buy these names with little in-between haha. Would be shocked at a horizontal move in this sector over the next 12-18 months. Excited to see this one play out
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Portfolio Bracketology - $AAPL is the Champ!
Portfolio Bracketology has concluded and you have chosen $AAPL as your champ! $AAPL beat $VTI 21 - 16 in the final poll results (combined between Twitter and Commonstock poll).

Below is the final bracket:

The bracket was made up of all 55 of my active holdings - as verified here on @commonstock. Seeding was based on total return since initial acquisition date through 2/28/22. Final rankings are based on poll results - ranked in each round by initial seeding.

Here are final rankings of all 55 holdings based off the results of the bracket (Initial in Parentheses):

  1. $AAPL (3)
  2. $VTI (8)
  3. $O (21)
  4. $HD (42)
  5. $VDE (4)
  6. $BAM (11)
  7. $LOW (32)
  8. $TGT (47)
  9. $XLE (5)
  10. $ABBV (9)
  11. $SCHD (16)
  12. $KO (19)
  13. $VWO (20)
  14. $PFE (26)
  15. $SCHB (27)
  16. $PEP (31)
  17. $CMA (1)
  18. $CARR (2)
  19. $DD (6)
  20. $FUN (7)
  21. $RTX (10)
  22. $SCHF (15)
  23. $VEA (17)
  24. $MCD (24)
  25. $VNQ (28)
  26. $LEG (29)
  27. $SBUX (30)
  28. $HAS (40)
  29. $UL (43)
  30. $DIS (51)
  31. $COIN (52)
  32. $CTRE (53)
  33. $RVT (12)
  34. $VIG (13)
  35. $IEMG (14)
  36. $IEUR (18)
  37. $HASI (22)
  38. $PG (23)
  39. $CNA (25)
  40. $BUD (33)
  41. $CL (34)
  42. $HE (35)
  43. $TIPX (36)
  44. $VTEB (37)
  45. $PPL (38)
  46. $HSY (39)
  47. $CSX (41)
  48. $NSC (44)
  49. $LQD (45)
  50. $KMB (46)
  51. $BLV (48)
  52. $EMB (49)
  53. $T (50)
  54. $CRON (54)
  55. $CHWY (55)

Are there any surprises? Anything that stands out to you?

What are your overall thoughts on Portfolio Bracketology?

I had tons of fun putting this together and getting insight into people's perspective and thoughts on these companies holdings!
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That seems rad to me! I’ve never thought of putting your holdings head to head in a bracketed to-the-death tournament before! How do you determine the lineup to begin with?
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Portfolio Bracketology - Championship is Live!
The people have spoken and we are now on to the Championship of my Portfolio Bracketology Challenge!

In the Final Four we saw $VTI continue its expected run and knock off the Monthly Dividend Company, $O. Mega tech $AAPL handled Home Improvement Giant $HD to move on on the other side of the bracket.

The question now is, what holding will be named Champion - $VTI or $AAPL?

The poll is now live on my Twitter. You can check out the Twitter poll here, vote below, or both!

Thank you to all that have participated up to this point and those that are participating this round! It has been a lot of fun putting this together and getting the greater population's input.

For those of you that are new to this, I have been running a March Madness style bracket of all 55 of my active holdings. Seeding was determined by % price increase from initial purchase date through 2/28/22. Of course, all holdings are verified here on @commonstock!

I am going to try to piece together a Final Rankings of all 55 holdings based off the bracket challenge. I will share that later this week!
Championship Matchup - $VTI or $AAPL?
35%VTI
64%AAPL
17 VotesPoll ended on: 04/04/22
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