Mad Hedge Technology Letter
September 16, 2022
Fiat Lux
Featured Trade:
(THE NEW RULES TO TECH STOCKS)
(TINA), ($COMPQ)
Posts
First, I would like to welcome the hundreds of new subscribers that just recently decided to take the plunge by hand selecting the Mad Hedge Technology Letter.
Our services have experienced a record-breaking year as novice investors and seasoned pros seek out the best tech stock ($COMPQ) advice in turbulent markets which have been riddled with high volatility.
There has never been a better time on earth to be human and there has never been a better time to subscribe to this technology content, offering cheat codes to the technology sector.
On the surface, it doesn’t seem that way.
Daily headlines don’t offer a positive spin on the world with energy caps, social unrest, military operations, supply shortages, cost of living crises, and extreme weather delivering us humble pie in many alternative forms.
However, readers must get in tune with the new world of tech investing.
The most essential thing to know is that passive investing is dead in this new world of high-interest rates, a rapidly deleveraging asset bubble, and broken supply chains.
Passive investing is tailor-made for a low volatility, high liquidity and a low-interest rate environment which has been swept into the dustbin of history.
This world basically ended in March 2020.
If readers aren’t actively managing their tech stocks, then you are behind the game as there are new laws to the land in the wild west of tech stocks.
As managers' focus on active management continues to accelerate, investors are becoming more inclined to not only enlist the service of active managers, but to reward them with even greater responsibility, access, and attractive opportunities.
A survey of 125 advisors found that 66% of respondents are more inclined to consider an active manager now than before.
Active advisors are also more likely to be considered in 2022 than passive managers with 89% of respondents saying they are unhappy with their passive ETF performance in 2022.
Almost all show a loss.
The evidence is there for everyone to see.
Investors are migrating away from passive index funds that cannot make money when a basket of stocks go down.
This strategy only works during times of synchronized global growth.
Investors also liked how passive investing was cheap because managers did not have to take profits before an imminent collapse.
Now they do, and I must admit it does create higher execution costs, but would you want to be outright long as streaming services are losing subscribers in an accelerated fashion and constantly giving us downgrades and lower revenue targets?
The truth is that there are a lot of bad active managers out there with a poor track record.
Many don’t know how to time the market, hedge risk, and don’t understand how to analyze or prioritize the large swaths of data that inundate us every day.
The Mad Hedge Fund Trader solves this for you.
Similar to the dynamics of Silicon Valley, risk asset performance is also a winner takes all industry. Tech is even more volatile relative to the S&P meaning even more diligence is required to outperform the Nasdaq.
The shift from passive to active is a paradigm shift that many still haven’t been alerted to.
To top it off, many conservative investors I have chatted to have now been cut off from their go-to industry – real estate.
Readers also won’t be able to effectively invest in real estate with 6% mortgage interest rates and generational high prices with owners sitting on a mountain of equity, boasting 3% mortgages, and nowhere to move if they sell.
For lack of better words, there is no alternative or TINA – which is why there has been an avalanche of interest in how to actively navigate tech stocks.
It’s no surprise that a large portion of our new subscribers come from real estate backgrounds and are looking for new opportunities.
Go where your money is treated best, and I can tell you that you’ve found the right place.
Quit being passive and act fast!
Mad Hedge Bitcoin Letter
March 1, 2022
Fiat Lux
Featured Trade:
(WAR IS THE MAIN CATALYST)
(BTC), (TINA)
Crypto has been going wild the last few days as There Is No Alternative (TINA) takes effect.
Russia’s financial system has been crippled and shut off to the outside world.
Bitcoin has shot up to the number one means of storing wealth.
Russians are buying bitcoin in droves as bank runs and systemic risk inundate the financial system.
The Russian Ruble has been crushed the past few days and Russian citizens have been trying to get rid of any rubles they have.
In this scenario, Bitcoin absolutely makes perfect sense.
The Russian Ruble now stands at 116 Rubles for $1 and the US dollar and Swiss Franc have benefited from this flight to safety.
Over the weekend, the U.S. and its allies stepped up draconian measures against Russia, intending to stop its banks from accessing SWIFT, the messaging network underpinning global financial transactions.
The European Union banned all transactions with the Russian central bank in a bid to prevent it from selling overseas assets to support its banks.
Without the source of funds, Russia is unable to properly finance its military for the long haul and it could mean that this war could drag out to a long-term event.
That event is extremely positive for the US dollar and for assets that are shut out from the traditional global financial system.
Debate has been raging over whether bitcoin, which is not owned or issued by a single authority like a central bank, could be used by Russia to evade sanctions.
There is a high probability that the Russian government will also turn to Bitcoin to maneuver around the sanctions.
However, it’s debatable whether the crypto networks can handle that type of volume.
The liquidity simply isn’t sufficient.
The new measures will also target the National Wealth Fund of the Russian Federation and the Ministry of Finance of the Russian Federation.
A secret Chinese research paper circulating around comes to a conclusion that this war could fracture the global financial system making the US dollar less attractive in the long haul and concluding the US economy will be a big economic loser with the expenses adding up.
The Bank of Russia, the nation’s central bank, stepped in to stanch the ruble’s swoon by more than doubling the country’s benchmark interest rate to 20% from 9.5%.
The hike in rates is designed to tempt savers to keep cash in Russian banks since the West and its allies have moved to isolate Moscow’s biggest lenders from international markets.
Even the Russian stock market has been closed because of these events.
As the Russian military drives a convoy to the edge of Kiev, this is really looking ugly, and sadly, on a human level, it is tragic, but this event is bullish for Bitcoin.
The inflationary effects were thought of being a tailwind for Bitcoin, but it appears as if the world has had to dive deep into a massive kinetic war to kindle that Bitcoin pixie dust once again.
I am bullish Bitcoin if the fighting continues.
