Eye Spy
Thoughts and ideas to note to myself to look back on how terribly inaccurate they were.....
1. November is the best month of the year for stocks. Most people hear this spammed around the place because it's a statistic based on SPY returns since 1950. But I didn't measure it like this.
I instead proved this claim true by measuring how many stocks in the overall market, rose in November.
68% of the time, since 2002 (when data starts), the number of stocks in the overall market (MMFI), was higher at the end of November, vs the start of November.
Similarly, July comes 2nd place at 61%
And the vast majority of other months come close to 50%, with the exception of January at 32% and September at 39%
2. Following on from the above, it then makes sense that tech performs well in November. This would also be true, since SOXX is positive 83% of the time since 2001. This is the highest % positive for any month. The average return is almost 6%.
Notably, semiconductors have declined in recent days, despite NVDA being at ATH, the semiconductor index SOXX sits almost 20% below it's own ATH.
I view this as an opportunity to leverage through SOXL, 3* tracking the daily return of SOXX. Much thanks to the carry trade fiasco, SOXL has not returned to it's own ATH, the decay and leverage, mixed in with high volatility, decimated this ETF and dropped it more than 50% in just a few weeks.
It is barely positive for the year, and so I see limited downside risk.
I have entered a large SOXL position, willing to risk up to 50% of account (currently 37%) at an average entry of 34 (current price 30). I look to close on a large swing upwards, and will DCA gradually on any dips before then.
To add to this thesis, I have my first entry command generate last week, a relatively rare signal with a good track record.
3. Oil. Now this isn't one I would personally take, as I try to avoid commodities and specifically avoid assets that benefit directly from warfare. I am a puss and it gives me sleepless nights.
But that said, long OIL is very interesting here. You would be betting on an inflation uptick, or potentially geopolitical fears, increased tensions in war zones such as Israel, Lebanon, Russia or Ukraine.
Price is currently at a level that has consistently supported a rebound and I don't think it is likely we see low $60's in oil prices.
4. NATGAS! Yikes. Ok maybe I shouldn't say this one. Particularly to an audience whom invest on a platform which probably generates most of it's CFD income from natgas gamblers.
I expect a rebound in commodity prices generally, but particularly around energy.
This is partly attributed to an expectation of an energy war related to AI. No, not a literal war. But rather large tech companies, fighting to get their hands on any available energy source.
Most of these tech companies have already made promises to governments on their renewable energy usage, so with all these big data servers popping up everywhere that need to be powered - the likes of AAPL, AMZN, MSFT, NVDA...are all hunting for new ways to power them.
Just look, even recently there are signs of this starting - MSFT for example has practically bought a whole nuclear station. The Three Mile Island Nuclear Site has been re-opened solely to power MSFT servers.
Yes, a whole nuclear site.
Oh and if I forgot to add, the Three Mile Nuclear Site is also the area well known for the worst nuclear event to ever happen on American Soil. MSFT signed a 20yr deal...
https://www.bbc.com/news/articles/cx25v2d7zexo
As a result, I expect Natural Gas to rise.
Instead of directly exposing a portfolio to the volatility of a commodity, which etoro (and other brokers), trade solely as future contracts and thus are leveraged CFD products, you can invest in companies that produce natural gas.
The ones in my focus are KMI and EQT, with EQT being the most efficient way to track natgas through a stock.