TradeSmith Daily

December 2019

Best Of: It’s the Beginning of an Era for Amazon

December 30, 2019TradeSmith Research Team

Editor’s note: In February 2019, we said it was “the beginning of an era” for Amazon. As 2019 comes to a close, Amazon’s stock price gains are in the neighborhood of 23%, despite a lot of tough publicity over the course of the year. In a bigger picture sense, Amazon is the dominant example of the “disrupters versus the disrupted” phenomenon — and for that reason, the dominance may have only just begun. Apple became the world’s first company to

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A New Year, a New Decade, and It’s Time to Get Back to the Basics

December 30, 2019TradeSmith Research Team

Quick question, and answer honestly: Do you have an exit strategy in place for each of your stocks? Hold that answer for a moment. In just a few hours, the calendar will turn over, and we’ll be in a new year and a new decade. One year ago, we were coming off the worst Christmas Eve performance in history and today, we’re sitting at the end of the year with a powerful rally that nobody saw coming. Bull markets and

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Best of: Why WeWork Summed Up the Unicorn Bubble

December 27, 2019TradeSmith Research Team

Editor’s Note: In August, before the IPO was canceled, we said that WeWork sums up “everything that is wrong” with the unicorn bubble. Then the storyline went gonzo, with a series of founder fiascos so nutty they’ll be remembered for a generation. Here’s a look back on our early call pegging the craziest startup of 2019. Generally, you want to avoid cash-burning companies when they go public. The initial public offerings (IPOs) for Lyft and Uber were an example of

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Best of: The Optometrist Investor Who Became a Billionaire

December 26, 2019TradeSmith Research Team

Editor’s note: While Hendrik Bessembinder’s “most stocks are duds” research was shocking and a bit of a bummer, the story of “Dr. Herbie” was the most inspiring thing we came across in 2019 — and worth a look back heading into the year’s end. Forbes has a profile on the greatest billionaire investor you’ve probably never heard of. Dr. Herbert Wertheim, a 79-year-old semi-retired optometrist and small businessman, has a stock portfolio worth $2.3 billion (according to Forbes estimates). “Dr.

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Best of: A Look Back at the Smoot-Hawley Tariff Act

December 23, 2019TradeSmith Research Team

Editor’s note: Thanks to U.S.-China trade negotiations, the confirmation of Brexit, and various other factors, 2019 was the year global trade felt a backlash. Some economists are worried about the return of a “Smoot-Hawley” mentality to the world stage — hence our holiday lookback at the original event. In a speech to the House of Commons in 1948, Winston Churchill said: “Those who cannot remember the past are condemned to repeat it.” Churchill was paraphrasing the philosopher George Santayana. To

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Will the United Kingdom Still Exist in Five Years?

December 20, 2019TradeSmith Research Team

The euro had its debut as a currency on Jan. 1, 1999, initially rolling out for 11 member states. From the very beginning, there was skepticism the euro would survive. Some still wonder if fallout from the next global recession will break it apart. Whereas European monetary union weathered a Greek debt crisis, it may not survive one with a far larger member (like Italy or France). The interesting question now, though — and one few people saw coming —

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To Invest in that Startup, Maybe Get a Stockbroker’s License

December 19, 2019TradeSmith Research Team

The government has a bunch of weird and dumb rules. Anybody who flies commercial has experienced this. It’s hard to see how taking off your shoes makes air travel safer — especially when the bad guys can just try a different tactic, and TSA failure points have been demonstrated over and over — but the rule persists anyway. The “accredited investor” designation is another such weird and dumb rule, perpetuated by government decree. The idea behind the accredited investor rule

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Will FedEx Get Disrupted Like Kodak?

December 18, 2019TradeSmith Research Team

A dominant theme for the 2020s will be “the disrupters versus the disrupted.” The disrupters are the companies and industries that are changing the landscape with new technology, new business models, and new market dominance (if not a combination of all three). The disrupted are the companies and industries caught in the path of the disrupters, waiting to get steamrolled by technological change. The disrupted are likely to face declining revenue and profits, falling share prices, and possibly even bankruptcy

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