Big Cap vs Small, Drums vs Guitar, Helium And More

Here’s the transcript from this week’s Trading With Cody Live Q&A chat.

Q. Market is upset. Any thoughts Cody?

A. In the hedge fund, I did a little bit of covering some short hedges and selling some of my index puts, and I also nibbled a little BKSY for the first time in a long time, and I nibbled some U, and trimmed some UBER that I’d nibbled earlier in the week at lower prices. In the personal account, I’ve done nothing this week. As for the markets, this is basically the kind of action I was expecting when I talked about my outlook into that recent Blow-Off Top action that we sold into.

Q. Hi Cody. In the past, you’ve advocated for hedging using small cap indexes and stocks. Is there any concern employing this strategy going forward, given inflation trends? Small cap value stocks have historically beaten large caps when inflation has been above trend.

A. I’ve seen articles that suggest such things. But even if I believed that there was enough statistically significant data to prove that theory, I’d still be leery about betting on small caps over large caps right now.

Q. Hi Cody. Getting a position list with updated ratings of our Revolutionary holdings would be really helpful, as it would help inform tax loss selling. Any chance that would be possible before year’s end?

A. I’ll try.

Q. Dear Cody, Thank you for all the hard work you do. It is obvious that you have so much on your plate with your businesses and family. I’m going to be 66 in a few months and find it hard to believe that I just don’t have all the energy at my beck and call that I used to. Anyway, your family and your health should be the most important focus of your time. It looks to me like you have pretty much conquered your chosen world, so please don’t burn yourself out always trying to be on top of every new thing that comes along. Try to focus on what matters most to you, just like you laser in on your core stocks to invest in, while ignoring the noise of trends that don’t get you where you want to go. Take enough time to breathe, enjoy your life and family, maybe take a real vacation. We (myself and other followers) don’t want to lose you because you take on too much. Kurzweil Rate of Change, I know, but you can only travel at breakneck speed for so long.

A. Wow, that is a very nice email to receive so I shared it with my wife and we both were like, “Maybe we should take a vacation for a week or two sometime soon. Even a staycation with Amaris and Lyncoln at home sounds like a good idea.” So yea, I’ll be doing that sometime in the new year. Thanks for the kind words.

Q. Technical analysis and Elliot waves- you don’t make use of either technique/discipline. May I ask why?

A. I don’t think the universe is as orderly as Elliot wave believers need it to be. I also don’t think capitalism/the universe goes around rewarding good line drawing on past price performance, which is what Technical Analysis really is. I do look at charts, but I get excited when the chart looks “terrible” if I really like the company’s fundamental situation.

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A. OMG, I just went to the TradingWithCody.com email inbox and found the above email. I get spam emails like that quite a bit in that inbox but it’s not usually from a multi-billion dollar company like Bankrate.com. Boy, that email makes me bearish about real estate which sure feels crowded in general.

Q. Thank goodness my largest position is RKLB, everything else is sour.

A. Be careful, even with RKLB, as it’s a speculative, unprofitable small cap that’s focused on a brand new burgeoning industry. The markets have been killing most all of the stocks that fit that description even as RKLB has so far somewhat survived better than most.

Q. What are your nibble prices for ETH and RKLB?

A. I’d mentioned I might buy some ETH for the hedge fund below $4k and/or near $3500 or so. I’d nibble some more RKLB near $11 and I’d get very aggressive in the name below $9.

Q. Your thoughts on Redwire at this price of $7, with earnings delayed over a month now?

A. I’d worried about that financial controls issue that’s kept them from reporting earnings too. Sitting tight with a small position for now.

Q. If you’ve bought any Helium HNT, what exchange did you use please?

A. Here, read this article about why I was buying Helium and Helium miners when it was back at 11-13 cents. “This leads me to the other way in which I have invested in the network. Using Binance.us, which offers HNT trading is unfortunate because I don’t trust it as much as I do Coinbase which does not support HNT trading, I have invested a TINY, tiny bit — and I mean tiny bit of capital — into a few HNT tokens.” My referral link on binance.us is https://accounts.binance.us/en/register?ref=54900586 but that leads to me something that I don’t understand. I know that my followers opened up a lot of accounts and bought hundreds of thousands if not millions of dollars worth of crypto on binance.us after I referred them to it using that code. And binance said that I’d get like 20% of everybody’s commissions as a fee. Well, I’ve received a total of like 29 cents worth of fees as far as I can tell. I need to have Piper get an answer from them about this at some point. Anyway, yea, I own HNT and I bought it over there at binance and I’m supposed to get some sort of a referral fee like anybody else who refers people to binance.

Q. What are your feelings about gold at these levels?

A. I like gold better than most a lot of stocks, and I nibbled a little GLD to reopen that position in the hedge fund this morning.

Q. Do you have any thoughts on the biotech recommendations CDXS, INFI and PRVB?

A. I’m close to nibbling on CDXS and PRVB here, but am mostly sitting tight.

Q. Cody, what do you think of VIAC and UPST?

A. Wow, VIAC has crashed back to where it was before all that crazy spike to $100 that broke several of the biggest investment banks’ prime brokerage businesses. Archegos, remember? Anyway, I’ll take a fresh look at VIAC here, it might be interesting as a value play. UPST is too expensive but it’s a good company.

Q. Hi Cody, what are your thoughts on GRAB?

A. It’s a mini-Uber for southeast Asia. I’d rather own UBER.

Q. In a band, would you rather play drums, bass or guitar?

A. I always thought that playing guitar was the ultimate thrill for a rock star wannabe like me. But after playing drums when Rod lets me in our rehearsal sessions for our North Creek Trio band, I’m like — whoa! This is even more fun! Love those drums. I love rock n roll…So I’ll put another dime in the juke box, baby!

That’s a wrap. Peace and thank you.