Howdy folks, let’s saddle up and go round ’em up.
Q. Cody ~ As gold creeps down towards the $1,200 level I’m getting interested in making my first purchase of that shiny metal. As a rookie in metal investing, I was wondering what is a reasonable mark-up on the spot price to expect to pay? Also, are there additional companies you recommended with APMEX (I bought the silver you suggested in March) for gold transactions?
A. Back before it was an accepted situation that the “spot gold price” would always be 3-10% less than the price of actual gold on the street, I would have told you to pay no more than 2 or 3% over spot price for an unmarked gold ounce. Nowadays, you’re lucky to pay only 5% more on the street than the quoted spot price, so I’d try to pay no more than 5-6% over spot price. I’d probably look to Gold Eagles from the US or official gold ounce coins from Canada or a big country like that and that might cost you 10% or more over “spot price,” but the value of that gold is always got a premium to unmarked gold ounces and spot prices. Remember that you’re not buying physical gold to trade, but to own/hedge/protect your money, so if you pay a little bit more than the old 2-3% premium standard, I wouldn’t worry about it too much. And if you can go to a local gold coin dealer and establish a relationship with him/her, you’ll probably find the best deals at a place like that over time if you don’t want to shop from Apmex, which is always been fair and fast in dealing with me.
Q. How does it work? This is my first day.
A. Just ask me anything! I’ll try to answer.
Q. : hi, Cody — talkin’ about high-tech stocks you don’t address often, have any thoughts about RadioShack ($RSH)? I’m loving my TRS 80, but, um, how about these guys for a broken, losing model? Candidate for a short? Or, if too many of them are already there, something that should be on the watch list for one of your bankruptcy plays? Very interested in your thoughts on this one for the near-term or mid-term.
A. I think $RSH is busted and the shareholders doomed at this point, but they could find capital sources to keep them afloat for years in this free money, low interest rate, risk-on environment, so I wouldn’t short it either. I think $BKS and eventually a lot of other old retailers will join $RSH on the penny stock/revaluation/bankruptcy front, but that too could take years given that the Republican/Democrat Regime in power and the Fed it loves will do anything to keep corporation shareholders from losing in a free-market type environment.
Q. Cody: Re:your answer on $RSH. Is this a new attitude/analysis of yours on bankruptcy? So there will be no more, ir way fever, bankruptcies of companies because of the low-rate/investors/”regimes” factors you cite above? Where’s the dividing line?
A. Oh, no this is all part of what creates the ongoing stock market bubbles and other asset bubbles that we are living through right now. Bankruptcies are natural and inevitable, but they can and have helped keep many insolvent banks and corporations afloat for the last six years now via bailouts, 0% rates, QE, stimulus, etc. Bankruptcies in the corporate world will come back in a huge way in the next downturn/crash and that will be a WONDERFUL time to load up on equities.
Q. $YNDX what you think?
A. I’ve written a bit about Yandex https://tradingwithcody.com/?s=yndx and recently bought some. No change to that trade — we have several months for the stock to bounce back to the pre-Ukraine Wars levels, and I think it’s still a pretty decent bet.
Q. Cody what are your thoughts on $Ebay over the next couple of months? (thinking about buying some Oct. in the money calls).
A. I don’t see what would make $EBAY pop in particular over any other large cap tech stock over the next couple of months. If the market pops, you’d probably make money on the trade. But what’s the edge you’ve got on seeing a catalyst for EBAY right now?
Comment: You’re right Cody I do not see a near term catalyst for $Ebay. The only things that attracted me to it was that it’s taken a big hit bc of the cyber hacks and Icahn. Now that that’s over I figured investors my jump back in bc it’s cheaper now and hitting resistance at $50. As always thank you for all your hard work Cody!!
Q. Hi Cody, followed your call to trim $AAPL calls last week. Nice to have some cash and watch the rest to run. Thanks. I was wondering if biotech sector is something you would look into? It seems something interesting is going on with cancer treatment.
A. The guys who have an edge investing and trading in biotech either have connections that are corrupt inside the regulators or have PHDs in biotech and related doctor fields. I think the average Joe is probably going to lose money trying to play that game. I stick with what I know and that doesn’t include biotech stocks.
Q. Cody do u like $SWKS at a price to buy??
A. Skyworks is in the Drone/Wearables/Robotics Revolution book I’m working on, but I don’t see a specific near-term catalyst or price to get me excited anytime soon there.
Q. Cody, I read a lot financial news and there are trading ideas everywhere. When something makes sense to me, I put the ticker in my quote system to track the stock and read more about it. Sometimes I act, many times I don’t. When the stock goes up I kick myself with should have / could have thoughts. I realize I cannot possibly invest in everything, so how do you limit your trading focus? Keep in mind that I also want to diversify a bit away from tech.
A. Great question and one whose answer depends somewhat on the individual asking it. I once wrote an article for Financial Times that was called Managing Money Is For Idiots and in it I explained that good investors and traders will always kick themselves, even if they make tons of money because they’ll always remember their bad trades and missed opportunities that would have made them even more money. So you always feel like an idiot when it comes to managing your own money too, if you’re doing it right. I wouldn’t just diversify into sectors I don’t know well, just for the sake of diversifying.
Q. What does $INVN need to rally??
A. $INVN needs a blowout quarterly report or it needs time to build up its drone/wearables/robotics businesses.
Q. Cody, if there is going to be a bubble pop / market crash in 1-2 years time, how does this influence us investing in longer term stocks like $INVN or $CREE, etc?
A. Nobody can tell if the market will crash in the next 1-2 years with certainty and I won’t pretend to do so myself. I will help us navigate whatever comes our way, knowing that crashes and pain and economic crises happen, so hopefully we will be prepared for them just like we always have been so far.
Q. On $LNN: How do you see $LNN to add a new tranche at this level? (Haven’t got a full position yet).
A. Be patient and spread out your tranche buys over time, but yes, I do like $LNN for a long-term investment here.
Q. Have you done any work on $CODE?
A. No, I don’t have any edge on $CODE. I do however have a huge edge on $CODY. Sigh, my bad, not punny.
Q. $EMES would you put new money into this today? Thanks.
A. I’m not your guy on $EMES. Turtle108, the great Lucy Bottrell is the one you need to ask about that one. She’s been all over it here on TradingWithCody.com for us, but it’s not my pick.
Q. On $CREE: I have built what I consider a full position but with a much higher price point than current levels. Time to add more?
A. I can’t help with that kind of specific advice because I don’t know you or your portfolio’s holdings or your risk tolerance or your wealth profile or etc. Don’t overload on a losing stock in the name of tranche-buying though.
Q. $FB’s new acquisition of Pryte…thoughts?
A. Not significant for $FB shareholders, probably was a small sized deal, meaning “only” a few tens of millions of hundreds of millions of dollars for Pryte. “Pryte’s service, which has not publicly launched yet, seeks to make it easier for consumers without wireless data plans to use online services by selling short-term passes that would provide access to particular mobile apps, such as Facebook or Foursquare. Facebook, the world’s largest social network with 1.28 billion users, is primarily interested in the team behind Pryte, led by Chief Executive Markku Makelainen, Chan said. The one-year old, Helsinki-based company has valuable experience and relationships working with wireless operators, particularly in emerging markets, she said. The company has fewer than 30 employees, though it’s not clear how many will join Facebook.”
And that’s a wrappitydoodog. See ya later.