Inflation, Shorts, Uber, QCOM Goes Cars, And More

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

Q. Hi Cody. It seems like inflation fears are abating lately, what’s your feet to fire take on interest rates for this year & next? Thanks.

A. F2F, I’d guess interest rates will slowly climb higher for the next few weeks and then they will spike a little bit higher sometime late this year or early next year. I’d guess the yield on the 10 year Treasury will be around 2% this time next year.

Q. I remember back in the old days, you would give specifics (strike, exp.) for all your options trades including your hedges. Can you please do that again? Thank you.

A. I still try to do that most of the time. Apologies for when I don’t.

Q. Why not publish a table of current positions with recommended add prices that could be referred to at any time?

A. Because things change over time and my “Where I’d buy more” prices change over time too.

Q. What do you think about the potential acquisition by Qualcomm? Seems like an interesting and exciting new path for the company. Thank you again and sorry for all the questions!

A. Cars are going to have ever more chips in them, especially for the old school car companies. I think QCOM’s interest in autonomous vehicle technology makes evolutionary sense for them. I find it telling that Qualcomm chose an old school auto technology supplier like Veoneer and not a new start up like LAZR or MVIS.

Q. Hi, what do you think about NIO? Do you think China’s EV car makers will be boosted by Tesla’s Chinese supply chain just like how Apple boosted China’s phone makers in the past ten years?

A. Good question. I like NIO just fine but don’t want to own it and yes, probably.

Q. Have you ever looked at Cirrus Logic (CRUS)? They made a good acquisition years ago with Wolfson, and Lion Semi might turn out to be another. It does not seem to be that expensive. Maybe not revolutionary.

A. Yes, I just already have enough semi exposure with TSM, QCOM and NVDA.

Q. What do you think about Uber’s earnings? This quarter marked a record for bookings and after an initial negative reaction, the stock has rallied today. Is it worth nibbling in the low $40’s?

A. Yes, it was a fine report from UBER and I think the fact that some drivers are making $40 an hour on average is going to help them get a lot more drivers in there. I do think UBER is a fine buy here in the low $40s and I think it’s a great buy below $40 where it traded after hours last night.

Q. What rating would you give UBER at $43, and ABNB at $150?

A. Uber is an 8/10 here. ABNB is a 7+/10.

Q. I’m curious what price you would begin to nibble Astra again? It’s been selling off quite a bit recently. Thank you!

A. I cooled on the CEO of Astra and unless I warm back up to him, I’m probably never going to buy it again.

Q. Is anybody thinking about shorting CHTR?

A. Yes, I have a small short position in CHTR. T Mobile’s 5G for the home and Starlink and other competitors bode poorly for Charter Cable’s future.

Q. I’ve noticed you’ve sent some alert to cover some shorts. But we don’t know when you open the short position. Can you please make sure you send alert for both purchase and sale transactions?

A. Yes, I’ll try. I have a hard time talking about short hedges because I mostly do them in the hedge fund and not in the personal account and most people probably shouldn’t mess with shorts most of the time.

Q. On 05/27/21 you said, I’ve already started small short positions betting that the following stocks are headed lower: PLUG, BLNK, EXPI, MARA and RIOT. I think there’s a ton of fraud in the crypto markets. I think that most cryptos are headed much lower this year and that 90% of the current batch of cryptos are headed to, yes, $0. Question — what is your current stand on PLUG, BLNK, EXPI, MARA and RIOT? Do you still own these 5 stocks?

A. Well, there you go, I DID mention initiating the shorts! I’m still short a small position in all those mentioned here.

Q. I know Square is not a holding for us, but what do you think about their acquisition of Afterpay? Does that change the thought process on Square? Could this serve as a catalyst for the stock? Thank you very much!

A. I was surprised that a company that specializes in the same layaway payment model that I used to buy a boombox at Western Auto in 5th grade is worth $30 billion, but maybe Square will figure out how to integrate the services so well into their ecosystem that the price tag will work out. SQ’s a great company, I just got uncomfortable with the valuation so I sold it.

Q. The problem that I face on SQ and other overvalued companies in our portfolio is that I bought SQ at $55. It is up over 350% and I have a hard time selling my huge winners. I trim Square but I do not sell it all.

A. You have the luxury of me getting you into SQ before they went up a ton like that. For me, I was worried back in February that I had been trapped in my longs because I was just letting ALL of them ride and as I explained at the time, I needed to clear my head and do a Great Reset for my emotions and brain.

Q. Have you looked into FVRR and UPST? FVRR is a play on gig economy, which I feel is bullish. The stock is down 24% today for light guidance, but I think its an overreaction. And UPST is changing the lending space with AI.

A. I prefer UPWK to FVRR. I haven’t looked much at Upstart but we will do so. Piper, please get it started.

Q. I am a new investor. My question to Cody is that, all the stocks prices are sky high, and how can I start taking positions in FAANGS, and the TSLAs etc? Should I start nibbling (keep buying little amounts here and there) and not wait for the stock prices to come down, or should I just wait for the market to correct, or should I wait for a recession to come so the stocks trade lower? When should I buy them? Actually this question applies to all the recommendations that Cody made before I joined, and whose prices are very high right now. Please advise!

A. If you’re new to Trading With Cody or if you’ve been a subscriber for a while but haven’t acted on much of my strategies yet and/or if you haven’t been in the markets, but you’re sick of getting 0% on your CDs, Treasuries, savings, checking, etc while the markets have been continually hitting all-time highs this year, what should you do now? Before you ever make any trade, step back and catch your breath before moving any money anywhere. Rank your positions and your whole portfolio and make sure you’re not about to make any emotional moves with your money. If you haven’t yet read “Everything You Need to Know About Investing” then spend a couple hours doing so, please. It’s a quick read but chock-full of important ideas, concepts and strategies that amateurs and pros alike should understand. Then, take a look at my own personal portfolio’s Latest Positions and slowly start to scale into some of the ones you like best and/or the ones I have rated highest right now. I’d look to start scaling into a few of the many stocks in the Latest Positions that are at all-time highs along with a couple that we’ve recently featured in our Trade Alerts that I’ve personally been scaling into.

Ok folks, thanks. That’s a wrap.

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