Investiv Daily

  • 01 Jan
    Sunday Edition: Pitfalls & Risks Of Chasing Yields

    Sunday Edition: Pitfalls & Risks Of Chasing Yields

    When the purpose of your investments is to generate useful income, it’s natural to look around at all of the different investment vehicles available to you to find the highest yield for your dollar. The problem is that in today’s economic environment, investment yields work much differently than they did 20 or 30 years ago. More →

  • 30 Dec
    Why Big Pharma Isn’t A Good Investment Right Now

    Why Big Pharma Isn’t A Good Investment Right Now

    • The pharmaceutical industry is facing regulatory headwinds amidst positive global trends.
    • Fundamentals show that all the positives are already priced in leaving more downside room than upside potential.

    Introduction

    The pharmaceutical sector has been one of the worst performers in 2016. It’s down 11.22% year-to-date while the S&P 500 is up 13.37%.

    From a longer-term perspective, the pharma sector has largely outperformed the S&P 500. From the low point in the 2009 financial crisis, the iShares U.S. Pharmaceuticals ETF (IHE) has gained 291% while the S&P 500 has gained 233%.

    Today, we’ll analyze sector trends, risks, and the fundamentals of potential pharmaceutical investments to see if the recent pullback is an investment opportunity. More →

  • 29 Dec
    Is Your Value Being Destroyed? Sven Tells You How To Spot It

    Is Your Value Being Destroyed? Sven Tells You How To Spot It

    • Buybacks and dividends continuously exceed earnings creating a financialized corporate environment and leaving less money for innovation and investments.
    • Such a situation isn’t sustainable in the long term.
    • We’ll close with an example of somebody willing to spend $21.5 billion of shareholders’ money to increase his salary by a few million.

    Introduction

    The end of each quarter is an excellent time to analyze what’s going on with buybacks and dividends. FactSet’s comprehensive analysis of quarterly buybacks and dividends for the S&P 500 is a great place to start.

    It’s of extreme importance to know what it is that management is doing with your money and if they are increasing or decreasing shareholder value. Today, we’ll analyze the situation and give you a few hints to enable you to easily analyze if the managers of the stocks you own add or subtract value with dividends and buybacks. More →

  • 28 Dec
    2017 Looks Like Another Excellent Trading Year

    2017 Looks Like Another Excellent Trading Year

    • Rebalancing your portfolio between sectors and markets should lower your risks and increase your returns in 2017.
    • 2016 is an excellent example of how such a strategy works when the general stock market is overvalued.
    • Things like avoiding REITs in August 2016 or entering metals will be easy to spot and act upon, even in 2017.

    Approaching The Current Market Risk Reward Puzzle

    A recent Wall Street Journal article raised the question of whether investors looking to get into the market now are too late for the Dow 20,000 party. Many investors watched the 7-year stock bull market from the side-lines after they got burned during the latest financial crisis and didn’t overcome their anxiety and invest again. The article suggested that investing now is a good thing to do if you are a long-term investor. More →

  • 27 Dec
    The Silver Story

    The Silver Story

    • Silver has a big industrial application and could be also used for batteries.
    • The metal has been in a supply deficit for the last three years but prices haven’t yet reacted.
    • The bullish case is very strong. There’s significant downside, but the upside is greater.

    Introduction

    Two weeks ago we discussed how it’s a good time to start dollar cost averaging precious metals due to ballooning central banks’ balance sheets, the end of a 30-year low inflation period, and the current relative cheapness of precious metals in relation to their 5-year highs. Today, we’ll discuss how silver might be the better option to gold as it’s historically cheap, it has been in a supply deficit for the past three years, and its industrial usage is growing while production is declining. More →

  • 26 Dec
    Beware The Short Term Cycle In The Automotive Industry

    Beware The Short Term Cycle In The Automotive Industry

    • The automotive industry is expected to grow in the future. While the high barriers to entry eliminate new competition, it’s a perfect business to be in.
    • The short-term debt cycle and stretched balance sheets indicate a contraction in revenues, margins, and profits.
    • To make money with automotive stocks just follow the short-term cycle and be patient, it will hit stocks, it always does and it is close.

    Introduction

    I have recently been nagging about the negative asymmetric risk reward situation the general stock market offers. In order to give you more value, I’m going to analyze a few sectors in detail with the hope of finding the ones that will give you better risk reward ratios.

    Today, I’ll discuss the automotive industry. Many consider it extremely cheap, but valuations simply don’t want to hear about it and remain low. I’ll start with an analysis of the two cycles in the industry, continue with an overview of the fundamentals and a conclude with a risk reward estimation. More →

  • 25 Dec
    Happy Holidays From Investiv Daily

    Happy Holidays From Investiv Daily

    As it’s Christmas Day, I thought it might be nice to send readers a small ‘Thank You’ gift in lieu of an article today.

    The gift, a copy of our new report on the agricultural sector, was written by Sven Carlin, daily contributor to our Investiv Daily newsletter. More →

  • 23 Dec
    The Dow To Hit 20,000 Alongside A Strong Dollar, Time To Be Greedy?

    The Dow To Hit 20,000 Alongside A Strong Dollar, Time To Be Greedy?

    • Investors can expect a nominal return from stocks of 4.3% per year going forward.
    • The story looks far different for speculators. The strong dollar and higher debt costs should weigh on the economy and stocks.
    • Specific sectors and international diversification offer a better risk reward situation.

    Introduction

    The Dow Jones is flirting with 20,000 points, and it’s possible that by the time you’re reading this, it has already crossed the mark.

    In addition to the Dow reaching all-time highs, the dollar index has also reached new highs for the decade. More →

  • 22 Dec
    Advice On Value Investing In Emerging Markets From Mohnish Pabrai

    Advice On Value Investing In Emerging Markets From Mohnish Pabrai

    • Investing in emerging markets still offers 100-baggers, the problem is that most investors don’t stick with them.
    • Looking for 100-baggers can make your portfolio, but it can’t break it because you can only lose 100% of the investment while the upside is unlimited.
    • Great investments can be found everywhere, you just need to know what to look for.

    Looking Around The World For Value

    It gets harder and harder to find stocks that have positive future business perspectives, a low valuation, and a price to book value that gives you a margin of safety when investing. Therefore, it’s necessary to do some research on such investments at a larger scale, especially in emerging markets. One person who is a specialist on this is Mohnish Pabrai. More →

  • 21 Dec
    Should You Invest In Russia? Sven Tells You Why It Might Not Be Such A Good Bet

    Should You Invest In Russia? Sven Tells You Why It Might Not Be Such A Good Bet

    • The numbers make Russia the cheapest global market.
    • However, most of the market is made up of energy and financials, while normal companies are fairly priced.
    • Long term economics in Russia aren’t positive as the country is completely dependent on oil prices.

    Russia As An Investment Opportunity

    Russia has been the best performing market year-to-date and is up 50%. However, it’s still considered by many in the financial environment as one of the cheapest global markets as it’s still far from the pre-sanction and higher oil prices levels of a few years ago. More →

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