Author: Andrew Packer

Cryptocurrencies

Rajat Soni, CFA: How Much Bitcoin to Retire in 20 Years?

Posted on by Andrew Packer

Since the launch of bitcoin in 2009, it has been the greatest-performing asset of all time. With those high returns come high volatility. As the crypto space matures, bitcoin has become easier to buy and hold than ever.

While bitcoin’s massive returns will likely slow in the decades ahead, it still remains a big winner. That’s because bitcoin is the only asset globally programmed with a maximum cap.

Currently, over 93% of all bitcoin that will ever exist have been mined. Today’s investors may balk at an asset trading in the six-figure range. But it likely has more upside given that it’s still in early adoption.

If bitcoin continues to outperform traditional assets, a buy today could fund a reasonable retirement in 20 years.

That’s based on several factors. An investor should first estimate their retirement needs. That includes calculating the cost of living in various cities. Then, add in a margin of safety.

For a high cost-of-living area like New York, it may take about 4 bitcoin to retire in 20 years. That assumes bitcoin averages a 20% return.

That would cost just over $400,000 today. If bitcoin averages a 30% annual return, however, it may take less than 1.5 bitcoin to fund a retirement. Investors who buy today can still get a valuable bargain in the future.

 

To see the full calculations behind retiring on bitcoin, click here.

 

Commodities

Sprott: Top 10 Themes For 2025

Posted on by Andrew Packer

2025 starts off as a continuation of 2024. That bodes well for some commodities, particularly precious metals and uranium. Gold just beat out the S&P 500 in 2024, soaring about 25%. That’s the metal’s best annual performance in 14 years.

Meanwhile, the rollout of AI has led to a resurgence of demand for nuclear power. That, in turn, has pushed uranium higher. That’s another trend still in its early stages with more room to run.

Meanwhile, commodities such as copper have a murkier outlook. Copper plays well to global economic growth. But a slowing economy in China, the world’s second-largest economy, should derail copper.

However, the current imbalance between supply and demand still remains in favor of higher prices. Investors can still look to copper stocks as a potential buy during periods of weakness.

Plus, energy was a lackluster sector in 2024. But events continue to shape up in favor of traditional energy assets. One reason why is the concept of energy security.

America is largely energy independent, but has an opportunity to export significant amounts of natural gas to Europe. That could offset a potential price decline that may otherwise occur as American producers are encouraged to drill.

In this scenario, smaller energy explorers and producers could be the big winner relative to the oil majors.

 

To see the full list and details of 10 commodity themes, click here.

Income investing

Dividend Growth Investor: Three Dividend Growth Companies Increasing Dividends Last Week

Posted on by Andrew Packer

Whether stocks rally or decline, they’re still fractions of a business. And over time, focusing on a company as a business can lead to massive returns. Most businesses mature and slow down after a hefty growth phase.

As that happens, cash flows shift from reinvesting in the business to rewarding the owners. That usually takes the form of dividend payments. A rare handful of companies have a history of increasing that payout over time.

The list narrows further for a ten-year period of raising payouts over time. But these companies tend to be great for long-term, patient investors. For those thinking about future cash needs decades down the line, dividend growth is optimal.

Recently, three companies raised their dividends. That includes utility firm Consolidated Edison (ED), which generates gas and electric power in the New York City area. They just raised dividends for the 51st consecutive year.

Over the past 10 years, Con Ed has raised its payouts by an average of 2.8%, about in-line with average inflation. Shares currently yield 3.5%, more than double the average dividend from the stock market index.

Another player is industrial and construction supplier Fastenal (FAST). They raised their dividend by 10.3%, and for the 26th consecutive year. Fastenal currently pays a 2.1% dividend.

Dividend growth companies may not be exciting short-term trades, but their long term track record is fantastic.

 

To see the third dividend growth play this week, click here.

Economy

QTR’s Fringe Finance: Market Right Now Is “A Story of Contrasts”

Posted on by Andrew Packer

While the stock market has snapped back some weakness to start trending higher in the past week, structural problems remain.

Corporate America is excited about the incoming Trump administration. The economic focus on deregulation and keeping tax rates at their current level, or even lower, is generally bullish. However, tariffs could ignite a trade war, which could lead to another round of inflation. That’s just one contrast.

In that scenario, domestic companies like banks and other financial stocks could fare well. Ditto for smaller energy companies focused on domestic exploration.

For companies with significant global operations, the picture can be a bit murkier. That’s also true for tech companies. Many of today’s semiconductor manufacturing is done overseas. Domestic facilities are being built or retooled for advanced AI chips. But they aren’t ready yet.

And while consumer spending is strong, so is rising credit card debt and delinquencies. If consumers have to slow their spending, the economy could easily slip into a recession.

For now, we’ll know more as specific policies are released from the White House. And as companies report earnings and note on potential dangers.

In this kind of environment, investors and traders should look to scale back aggressive trading. And shouldn’t try to force a trade just for the sake of trying to score a quick profit.

 

To read the full analysis, click here.

Stock market

FX Evolution: You Won’t Believe What Retail Traders Did This Week

Posted on by Andrew Packer

Markets have started the year trending higher, fueled in part by signs of moderating inflation. That’s allowed the market structure to show a better sign of strength. And it reverses the potential selloff signals that stocks were giving in the final weeks of 2024.

While the Santa Claus rally failed to materialize, stocks were up in the first 5 trading days of 2025. And are on track to end January stronger. Both moves point to an up year.

Reads such as improving breadth and moving average convergence/divergence also point to markets closing 2025 higher.

In fact, the stock market just presented a signal it last hit in 1928. It just recorded five straight days of at least 68% breadth. That means two out of three stocks moved higher. That’s a much healthier sign than a market dominated by a few large-cap tech stocks.

Of course, 1928 was the last full year of a bull market before the start of a bear market in late 1929. So traders will want to be mindful that stocks may have more upside this year, but not indefinitely into the future.

However, January’s market moves also indicate that stocks will likely be volatile. And traders and investors alike should be prepared for a correction in the 10% range. For now, the trend is back to bullish.

 

To see the full technical analysis on the market right now, click here.

 

Stock Picks

Felix & Friends: Top 6 Stocks to Buy Today

Posted on by Andrew Packer

The market’s lackluster performance in the past few weeks leaves the S&P 500 down about 5% from its all-time high. While that’s making some investors nervous, buying 5% pullbacks tends to work out over time.

Plus, 5% pullbacks occur more often than 10% pullbacks. Investors would need to go back to October 2023 to find the last one. As long as the market’s long-term uptrend is intact, buying 5% pullbacks makes sense.

With that in mind, investors have plenty of stocks to buy on market pullbacks that should generate big returns.

That includes tech giants like Microsoft (MSFT). While not the biggest name in AI, Microsoft has built a product suite that allows it to be the top or second player in a variety of software spaces.

The rollout of AI will continue to benefit Microsoft, and it’s the kind of stock investors should buy during pullbacks. Microsoft is also a dividend growth play, making ideal as a long-term holding.

Another winner here is Alphabet, parent company of Google (GOOG).

Besides growing out its own AI models, Google continues to generate massive cash flows in the search space. Plus, Google is gaining ground in the cloud services space.

Shares are also fairly priced, and the stock has underperformed recently on short-term concerns.

 

To see the full list of stocks to buy now, click here.

 

 

Stock market strategies

Swordfish: Are Stupid Options Actually Genius?

Posted on by Andrew Packer

There are many ways to trade. Most traders gravitate towards options. They can be used to build a position at a lower cost than buying shares of a stock. Or they can offer better returns when there’s a massive move.

Plus, options include both call and put options. So traders can inexpensively bet on a stock declining at a fraction of the cost of shorting a stock. The options market also offers a window into interesting and unusual trades.

For instance, the options market will let investors make trades with expiration dates years into the future.

For investors who predict a multi-year bull or bear market, buying long-dated options can offer massive prospective returns. Even if those trades look impractical or downright stupid now.

Currently, traders can bet five years out that the market will rally as much as another 67%. Over a five-year period, that’s certainly possible.

However, the average five-year rolling period is a bit under 70%. If the bet is correct and stocks return over 67%, the buyer of the options could make 10-60X returns, or up to 6,000%.

If the bet is wrong, it could mean a total loss. That’s the case if stocks trade lower, flat, or up less than 67% by 2029.

While buying long-dated market calls may sound like a potential big winner, the risk of loss remains high. Traders are usually better off making shorter-term trades. But sometimes, even a silly-sounding trade idea could be a big winner.

 

To watch the full options trade breakdown, click here.

 

Passive Income

Of Dollars and Data: Is There a Problem with Passive Investing?

Posted on by Andrew Packer

One of the biggest investment shifts in recent decades has been the move towards passive investing. Today, over half of all equity fund assets are in passive funds. That’s over $13 trillion in assets.

Passive investments avoid the higher costs of moving in and out of individual stocks. Instead, passive investments look to buy an index. Consequently, these funds offer low fees that make it easier to match the market’s returns.

However, the rise of passive investing has some potential dangers. Since most market indices are valued by weight, larger-cap companies dominate indices. If the Magnificent 7 tech stocks sell off, the overall S&P 500 index could fall. Even if the other 493 stocks in the index rise.

As more and more capital moves into a passive investment, the more this concentration risk rises.

Given the hefty valuations in many large-cap stocks, this danger shouldn’t be overlooked. Plus, by investing in funds, individual investors are giving money managers voting rights in specific companies.

This could simply mean that fund managers “rubber stamp” corporate voting with management. Even if such proposals aren’t in the best interests of individual shareholders.

For now, passive investing remains a runaway success. But investors may want to look for equally-weighted funds to avoid stock concentration risk.

 

To view the full list of pros and cons to passive investing, click here.

 

Economy

The Compound: No One Can Figure Out 5% Treasury Rates

Posted on by Andrew Packer

The most watched financial instrument is the 10-year U.S. Treasury bond. That’s because the yield indicates a risk-free long-term rate of return. Recently, yields have been on the rise, from 3.6% in September to 4.8% now in January.

Typically, the 5% level represents a tipping point for stocks and the economy. That yield may be too high to be sustainable given current debt levels. But it may also entice buyers into Treasuries.

Rising bond yields are also occurring as the Federal Reserve has been cutting its interest rates. That’s resulting in a steepening yield curve. With the yield curve now un-inverted, investors are getting paid more for holding longer-dated bonds. But such un-inversions have often occurred shortly before a recession.

If that trend holds, investors could expect trouble in the next 9-12 months. However, the trend may not as part of the pandemic-era oddities.

If bond yields are rising because of a healthy economy, then the economy may not sour until 2026.

For now, high bond yields are keeping some markets out of favor. One such market is the housing market. While prices have moved higher overall, the rate has significantly slowed.

With mortgage rates near 7%, it’s the housing market taking the most pain in the financial markets right now.

 

To watch the full interview, click here.

Stock market

Elliott Wave Options: New Year Fear, Bonds Hinting at Downside?

Posted on by Andrew Packer

Markets struggled in the first weeks of 2025. Strong jobs data hints at a strong economy. In turn, that means inflationary pressures remain. So, it’ll be challenging for the Federal Reserve to further cut interest rates this year.

Meanwhile, the bond market has already processed this idea. Bond yields have been rising since September, when the first interest rate cuts were made. As bond yields rise, pressures rise on the stock market.

That’s because stocks and bonds tend to move in opposite directions. As bond yields rise, the attractive yields garner more capital. That leaves less capital for the stock market. And after two years of back-to-back 20%+ returns, investors expect a market pause.

Stocks can still trend higher this year. But rising bond yields act as a tremendous tailwind. Particularly for capital-intensive industries and technology companies.

Given that the market didn’t even face a 10% correction in 2024, investors should continue to tread cautiously. More volatility is the likely outcome in the months ahead. And an early-year market correction can’t be ruled out, even if seasonal trends make an autumn pullback more likely.

For now, investors looking for yield can certainly get it in bonds. The question is how high bond yields will head before peaking. And if the 10-Year Treasury bond tops 5%, stocks may face more immediate downside.

 

To view the full technical analysis on markets right now, click here.