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20 Jan 2025

An important remainder ahead of Trump inauguration:

"Don't let your politics get in the way of your investing. The market finds a way forward, regardless of who is in power. The market soared under both Trump and Biden, as it has under most presidents" - Peter Mallouk

17 Jan 2025

What Buffett Looks For and What to Avoid:

Source: The Investing for Beginners Podcast @IFB_podcast on X

17 Jan 2025

The insight from John Exter’s pyramid underscores the unseen layers of risk in financial flows, urging a broader consideration beyond balance sheets in investment decisions.

Amidst flaws in the financial system, gold offers liberation from credit and government risks and currency devaluation. As sovereign debt defaults loom and trust in public institutions to solve economic and societal issues shrinks, investors will more and more focus on asset with no counterparty risks like gold Source: Capitalizing on Gold’s Positive Tailwinds in 2024 : Hard Assets Alliance

6 Jan 2025

Don't try to time the market:

Source: LPL research through Brian Feroldi

19 Dec 2024

‼️AHEAD OF THE FED MEETING YESTERDAY, INSTITUTIONAL INVESTORS WERE ALL-IN ON US STOCKS AND CASH ALLOCATION AT RECORD LOW ‼️

Institutional investors* cash allocation hit the lowest level ON RECORD. This comes as allocation to US equities hit a RECORD HIGH. What will happen when stocks begin to drop? *171 Fund Managers with $450 billion in assets Source: BofA, Global Markets Investor

18 Dec 2024

"Cash is trash"

Fund Manager cash allocations at a record low... Source: Callum Thomas, BofA

16 Dec 2024

The case for a 2% Bitcoin allocation into multi-assets portfolios by Blackrock:

"So how can investors think about a bitcoin allocation? We take a risk budgeting approach: sizing the allocation based on how much it would contribute to total portfolio risk – measured by its long-run volatility and correlation to other assets (...). But from a portfolio construction perspective, it has some similarities with the “magnificent 7” group of mostly mega-cap tech stocks. Their market value – averaging $2.5 trillion in December 2024 – is similar to bitcoin’s (...) In a traditional portfolio with a mix of 60% stocks and 40% bonds, those seven stocks – if held at their current weights in the MSCI World – each account for 4% of the overall portfolio risk on average. That’s about the same share a 1-2% exposure to bitcoin would represent: Even though bitcoin’s correlation to other assets is relatively low, it’s more volatile, making its effect on total risk contribution similar overall. A bitcoin allocation would have the advantage of providing a diverse source of risk, while an overweight to the magnificent 7 would add to existing risk and to portfolio concentration. Why not more than 2%? A larger bitcoin allocation means its share of overall portfolio risk rises sharply. This effect is small when the allocation is small, but above 2% bitcoin’s share of total portfolio risk becomes outsized compared with the average magnificent 7 stock (...) . In an extreme case, should there no longer be any prospect of broad bitcoin adoption, the loss could be the entire 1-2% allocation. We think this is much less likely to happen to a magnificent 7 stock given these companies generate major cash flow and have tangible underlying assets. The upshot? By allocating no more than 2% to bitcoin, investors would: 1) introduce a very different source of return and risk; and 2) manage risk exposure to bitcoin".

10 Dec 2024

We are maxed out across a host of sentiment indicators.

Source: Mike Zaccardi, CFA, CMT 🍖 @MikeZaccardi, Goldman Sachs

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