Friday File: Happy (?) New Year!

What's happening with our Real Money Portfolio as we start the year? Updates on Roku, AerSale, The Trade Desk, Power REIT, GAN and many more...

By Travis Johnson, Stock Gumshoe, January 8, 2021


Happy New Year! The fact that this week’s portfolio moves included a little stop loss selling and some nibbles in asset management, insurance and music royalties probably tells you all you need to know about how cautious I feel to start this year… though, as always, I try not to have my personal sentiment drive big investment decisions. Feelings don’t usually beget good strategy.

The stock market’s year started with some profit taking early this week, as the folks who didn’t want to pay capital gains taxes on their hugely successful positions started to sell some of those soaring shares on Monday. Either that, or investors started to worry about changing taxes or other policies with the Georgia Senate vote shifting slightly more democratic in the polling, and then confirming that with a win for both Democrats. Or maybe they worried about President Trump’s ludicrous behavior on his way out the door, which got even more absurd and dangerous once the electoral count started on Wednesday. But that worry all washed away, it seems, once investors started to see a clear path to much more stimulus spending under a united government in a couple weeks, the final procedural vote was completed for the presidential transition, and we started to think again about the likelihood of a much brighter future once the vaccine gets fully distributed over the next six months or so… and we saw many of the usual suspects race to new highs. The market often overreacts to momentary shocks, but, the pundits persist in telling us, most of the time it really is a barometer of what investors see coming in the next 6-12 months.

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I don’t know why the market rose or fell each day, obviously — the stock market is a combination of millions of mood rings, and day-to-day moves don’t generally mean much or have single reasons, particularly after a hugely volatile year and with a whole new generation of day traders trying to react to each moment — but stocks went down a bit before they recovered this week.

Which was probably scary, for folks who might not have been investing prior to last April, so now that optimism is rising again we should repeat our public service announcement here: Sometimes stocks go down, and sometimes investments lose money. Beyond that, well, explaining the reason for ...

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