Latest Positions Part 5: The Others, The Shorts, The Cryptos, The Bubbles

Here is Part 5 of 5 of the list of my latest personal portfolio positions and most of the hedge fund positions with updated commentary and ratings for each position.

Longs –

• ROKU Roku Inc. (7) – Not much has changed with Roku since my prior Latest Positions report. Its price is almost exactly back to where it was when I wrote that report after correcting 25% from its recent mid-February high of $386 a share. I still am confident that Roku is going to be the bundler of the unbundled streaming networks. As more and more people transition from linear tv to streaming tv, the $70 billion dollars in advertising spent on linear television are going to rapidly start following them to streaming. Roku’s platform is positioned perfectly to start collecting those dollars.
• MP MP Materials Corp. (6+) – There is beginning to be a lot of froth and even outright fraud in the EV market. Quite a few of this current batch of EV companies will not even exist in the next few years. What will exist is the real electric vehicle companies and the very real demand for their electric vehicles. MP is going to sell their rare earth materials to those companies. With that said, this has been a huge winner for us in a short period of time. If you haven’t trimmed a little, now is a good time. I am not in a big rush to buy more of this long term play.
• JMIA Jumia Technologies (6+) – Here is another of our stocks that have round tripped from the price that I last wrote about in December to all-time highs in February back down to close to the December price.  Not much else has changed with the stock.  This stock has had a huge run from about $2 a share a year ago to over $51 today. The common theme here today is if you have not taken profits, please trim some here.
• U Unity Software (7+) – Roblox’s recent IPO has taken a little attention away from Unity. That’s a good thing.  I like the risk/reward of U over RBLX right now. Roblox has a $39 billion market cap compared to $30 billion at Unity. Unity is not growing as fast as Roblox at the moment, but I like their diversification in the 3D and Virtual Reality Revolutions not to mention not having to rely on a customer base mostly under the age of 14.  In the Mark Zuckerberg podcast that I wrote about in Part 4, Zuckerberg mentioned a couple of games on Oculus that he likes to play.  Guess who’s development platform is behind most of those games. In that interview, he also mentioned that once we get over about 10 million people using VR platforms, then it is a big enough market for every kind of developer to start developing for the VR platform. He says we are close to that 10 million number already and will certainly blow past it into “the many 10’s of millions of VR users.”  That is when and where Unity will really shine.

Shorts –

• QQQ Nasdaq 100 ETF (7) – I’ve got some index shorts and puts as hedges to our long exposure.
• SOXX Semiconductor ETF (7) – I have switched out my previous semiconductor short SMH with SOXX.
• IWM Small Cap ETF (7+) – I’ve got some index shorts and puts as hedges to our long exposure — I think small caps look like they are probably ripe for underperforming the broader markets for the next few weeks, months or quarters.
• EWU and EWUS British ETFs (7) – I’ve got some index shorts and puts as hedges to our long exposure.
• Tiny short hedges, rated about a (7) – in BLNK, VLDR, EGHT, CHTR, FSLR, and others. There is beginning to be a rampant amount of fraud with second tier SPACs and other penny stocks. I’m looking for those individual names to short.  As always, I might cover these at any time and I’m not expecting to make much money on these shorts.  They’re just hedges for the hedge fund and I’m not sure any of these are no-brainer shorts.  Please don’t just go around blindly shorting these for your personal portfolio.

Cryptocurrencies/tokens –

• Bitcoin (7) – From last week’s Part 1. “Here is what I wrote about Bitcoin in the previous Latest Positions.  “Well, here’s the long-awaited break above $20,000. I trimmed a little bit of the bitcoin futures (BRR) that I own in the hedge fund today when they hit $21,000 (the futures trade at a light premium to bitcoin). Other than that, this remains the de facto standard cryptocurrency of the world and therefore remains the currency most likely to replace the US dollar as the world’s reserve currency in coming years.”  The only thing I would change is the $20,000 number is now $50,000.” In just one week, I guess I should change that $50,000 number to $60,000.  After breaking out to almost $61,000, Bitcoin has pulled back because of fears of India banning the use of cryptocurrencies.  Bitcoin doesn’t need India and I’m not sure how anybody can actually ban cryptocurrencies in a practical manner that could be enforced, but it’s worth keeping an eye on.
• Stellar Lumens (6) – I think it’s best not to group all cryptos together and that over time, each will trade on its merits and perceived/accepted values.
• Ethereum (7+) – Decentralized finance (commonly referred to as DeFi) is a blockchain-based form of finance that does not rely on central financial intermediaries such as brokerages, exchanges, or banks to offer traditional financial instruments, and instead utilizes smart contracts on blockchains, the most common being Ethereum. Just like Bitcoin, Ethereum is going to be one of the long term crypto winners.  It has also been hit with fears of India banning the use of cryptocurrencies.  Keep an eye on Ethereum, it could be worth a nibble if the weakness continues.
• XRP (6) – I think it’s best not to group all cryptos together and that over time, each will trade on its merits and perceived/accepted values.

Disclosure: At the time of publication, the firm in which Mr. Willard is a partner and/or Mr. Willard had positions in some of the positions mentioned above although positions can change at any time and without notice.

Remember: I wouldn’t rush into a full position all at once in any of these stocks or any other position you’ll ever buy. Patience and allowing the market and time to work to your advantage by buying in tranches is key. Maybe 1/3 or 1/5 of whatever you  might consider to be a “full position” in any particular stock. And I wouldn’t ever have more than 5-15% of your portfolio in any one stock position at any given time. The younger you are and/or the higher the trajectory of your career income, the more concentrated and risk-taking you can be with weighting in your portfolio. But spread your purchases and your risk out over time and over a several positions no matter your age or risk-averse level.

Scaling into a position using an approach of buying 1/3 or 1/5 tranches over time is how I build my personal portfolio positions, but there’s no scientific way to go about investing and trading. Sometimes you have to pay up for the latest tranche but I try to be patient and wait for a temporary sell-off to add to the existing position.

** NOTE FOR NEW SUBSCRIBERS:

If you’re new to TradingWithCody 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.