Cody Kiss & Tell: Economy, Trump & the markets, Nvidia, Gold, and more
Here is the transcript to this week’s Live Q&A Chat. Visit the Trading With Cody Chat room on the Trading With Cody iPhone app , the Trading WithCody Android app or in the Chat Room. If you have any questions about our service, just email us at support@tradingwithcody.com.
Q. As I travel around my rural home area and around the country I am completely amazed by the appearance of such a robust economy. There just seems to be an exponential growth in spending and consumption…the new home and business construction, the new and often expensive vehicles including recreational vehicles people are buying, the expansion of businesses, the fun money being spent, etc. etc. etc. Perhaps the Trump regime will catapult this growth exponentially further. I am sure reluctant to chase the market here but on the flip side the growth potential for markets and economies seems to be a freight train right now. Wondering your prediction related to the markets, oil, gold, etc. for the next year as you seem to have good insight on that? Thanks.
A. Great insights and you have great points about the economy, Trump and the markets: “As I travel around my rural home area and around the country I am completely amazed by the appearance of such a robust economy. There just seems to be an exponential growth in spending and consumption…the new home and business construction, the new and often expensive vehicles including recreational vehicles people are buying, the expansion of businesses, the fun money being spent, etc. etc. etc. Perhaps the Trump regime will catapult this growth exponentially further. I am sure reluctant to chase the market here but on the flip side the growth potential for markets and economies seems to be a freight train right now. Wondering your prediction related to the markets, oil, gold, etc. for the next year as you seem to have good insight on that? Thanks.
Q. Cody, assuming you currently owned no stocks, which ones in your portfolio would you purchase at today’s prices?
A. Look at my Latest Positions review with new ratings and analysis for each stock in the portfolio. And then go with the highest rated stocks in there and go slowly!
Q. Thanks, Cody for the positions update. It seems to answer most of the questions we’ve seen. One small one from me: Why only a 7 rating for NVDA? The recent runup? Valuation?
A. The fact $NVDA just tripled in the last few months. I think it could pull back towards the low $80s or $70s even in the next few weeks.
Q. I have a tough time selling winners and losers. Right now, $NVDA is 160% up where I bought in 6 months ago and I wonder if it makes sense to sell it all, take profits, and reinvest, say in $GOOG? If I sell half, I know I’ll rue when it goes up. Typically, I will sell on your alert, but then I’m out of the stock and almost never return. I’m obviously not disciplined to take profits like the bros on Wall Street. How should I avoid not taking profits?
A. Two most important words in investing/trading “Be cool.” But to be sure, most “bros” on Wall Street ain’t cool. Why don’t you do like I do and trim 10% or 15-20% at times instead of all/50%/nothing?
Subscriber follow-up: To amplify on the sell-NVDA-now-that-it’s-up-160% question, Cody,yesterday you said to me. “The fact $NVDA just tripled in the last few months. I think it could pull back towards the low $80s or $70s even in the next few weeks.” Would you say we should hold on and consider another tranche if it makes or gets close to that retrenchment? Let me just clarify, trying to reconcile your comment to me earlier and just now: if $NVDA does, in fact, begin to evidence a decline (as you said you might expect, yesterday), would you still consider a trim, or watch and wait? Or will that trim come only if NVDA moves upward out of its current “stall”?
Cody’s A.: I might look at trimming another 10% of my own $NVDA long soon. But I’m not trying to game any next move on $NVDA, as it might also rally to $110 before it pulls back next time. I’m just using the playbook as usual — investing in a Revolutionary company like $NVDA and slowly trimming/adding to a core position over time.
Subscriber follow-up: Yes, I like your approach but need to muster the discipline. Thank you.
Q. Hi Cody, question regarding gold. I share your view regarding gold long term and accumulating physical gold. My question is regarding $GDX, having a long positive view on Gold (5-10x today’s prices), would it make sense to invest also, long term, in $GDX? And if not, could you explain me why? Thanks in advance.
A. The $GDX is a basket of gold mining stocks. I don’t like the fact that almost every single miner company that I find has way more debt than cash. I don’t like the added risk of management, debt, execution, mines, etc that comes with owning a gold miner. If Gold has a pullback to $1000 or lower in the next few years, which is always possible, those gold miner stocks will drop 70-90% and some will go to $0. Meanwhile, I’m just holding onto my gold coins and bullion and they might lose 30% or even 50% of their value in the near-term at times in years ahead, but by the time I’m 90, I’d expect $Gold has climbed up to $5000 or $10,000 per ounce. But I have no idea if the $GDX or the stocks in the $GDX will still be around.
Q. Any thoughts on the $EWY Puts we’re holding? I’m wondering if the reported run on Samsung 4K TVs this Christmas season will even out the phones catching fire, and washing machines blowing up as far as EWY goes? A. I don’t think Samsung’s 4k TV business is enough to offset the hurt in smartphones for the Christmas season. And as I noted in the Latest Positions write up from yesterday, there’s no reason to think the Samsung brand will ever regain its recently-attained “high quality” status. Remember fifteen years ago when Samsung products were all just a cheap knock off version of Sony products.
A. I don’t think Samsung’s 4k TV business is enough to offset the hurt in smartphones for the Christmas season. And as I noted in the Latest Positions write up from yesterday, there’s no reason to think the Samsung brand will ever regain its recently-attained “high quality” status. Remember fifteen years ago when Samsung products were all just a cheap knock off version of Sony products.
Q. What are your thoughts on $AMD as a real competitor for $NVDA. is the value in $AMD that it might take a small part of a huge market for GPU’s and GPU/CPU’s?
A. $AMD‘s stock price over the last year sure acts as if the company is going to effectively compete with $NVDA in the wildly growing markets for GPUs and $INTC in CPUs. But I don’t think $AMD‘s invested in creating the platforms, tech roadmaps, and software to compete with $NVDA effectively over the next five to ten years in the applications of GPU to VR/AR/AI/Driverless cars/etc.
Q. $FB down about 20% from highs – do you see a buying opportunity coming or is this a longer term rotation away from Tech big cap into small cap and big cyclicals?
A. I think $FB is only down $15, or 11% from its all-time highs. I’d be a buyer back of some of the shares I trimmed back near $130 if the stock drops 20% from those levels, which would be at about $105.
Q. I’ve had home runs on calls of $WFC, $QCOM, and over a double on $AMBA over the last few months and have sold to take a profit but still retain a little more.playing with the house’s money. Any advice on when to sell these?
A. I’d sell $WFC yesterday. I’d hold a core position in $QCOM and a smaller core in $AMBA and chill.
Q. Does shorting the Russel 2000 $IWM interest you here at all? Your thoughts with that?
A. Shorting the $IWM might not be the worst idea I’ve heard all week, but I’m not personally doing so just yet.
Q. Short term $QQQ puts ( Feb) ) any thoughts ?
A. I can think of worse things than hedging $FB $GOOG $AAPL $AMZN and other longs with a few $QQQ puts.
Subscriber follow-up: That’s whee I’m at there too 🙂 Thanks.
That’s a wrap, thanks all! I’ll be around in the chat room most of the trading day throughout December so come on by and chat!
