Mentioned in Video:
- 🚀 Can META Beat ARK Invest? This Metaverse ETF Changes Everything: https://www.youtube.com/watch?v=nTW4tReANPA
- Inventory Pileups, the Latest Employment Report, & ARK Strategies | ITK with Cathie Wood (12/3/21): https://www.youtube.com/watch?v=mGw4P72d7Bc
- Roundhill Ball Metaverse ETF: https://www.roundhillinvestments.com/etf/meta/
- Support the channel and get extra member-only benefits by joining us on Patreon: https://www.patreon.com/tickersymbolyou
🤩 Basically everything #ARKInvest talks about, from #growthstocks (like Tesla and Palantir stock) to crypto (bitcoin, ethereum, and #coinbase stock) has been crashing over the last few weeks. Has #CathieWood and @ARK Invest lost their touch or are these still some of the best stocks to buy now? Here are the exact stocks I'm watching and how I'm building my all-weather growth portfolio.
Video Transcript:
00:00
In this episode, I'm going to lay out exactly what I'm doing as growth stocks are collapsing
00:05
and people continue running for the hills.
00:14
If your portfolio is hurting after these last few weeks, this episode is for you.
00:18
Your time is valuable, so here's the bottom line upfront: I'm not selling anything, I'm
00:22
building up my cash and my defensive cash-like positions, and I'm updating my watch list
00:27
with the exact stocks and funds that I'll cover in this episode.
00:30
Full disclaimer, I'm not a financial advisor and nothing in this episode is financial advice.
00:36
Let's get right into it.
00:37
Here's what's in my entire $100,000 dollar portfolio on public dot com right now, just
00:42
to show you.
00:43
I'll talk about what I bought and how it's been changing in a separate episode, but I'm
00:47
showing you this so you can see that I'm down 10%, 20%, or even 30% on the money that I've
00:53
invested so far.
00:55
This doesn't bother me at all because I believe in the underlying companies, many of which
00:59
I've covered on this channel, and I bought them for prices I thought were fair.
01:03
So the first thing I'm doing with this existing portfolio is absolutely nothing.
01:08
If you have stop losses on your positions, make sure you at least check them and make
01:12
sure they're still where you want them.
01:14
I've cleared all my automations and I'm doing everything by hand.
01:18
The only things I have automated right now are my price ALERTS so I know to check on
01:23
stocks that fall below a certain price.
01:25
For example, I'm always happy to buy Facebook stock below 300 dollars a share, which is
01:26
about an 840 billion dollar market cap, so I have an alert set to let me know when that
01:27
happens.
01:28
The second thing I'm doing is building up my cash and cash-like positions.
01:30
My account is actually still almost 50% in cash because I'm concerned about the Fed accelerating
01:35
tapering as well as the next wave of the pandemic.
01:38
If you're not concerned about those things, that's okay, but now you have a data point
01:43
for how I'm personally digesting that news.
01:46
What are cash-like positions?
01:47
To me, they're big tech stocks that are relatively stable and resilient to inflation but still
01:53
have plenty of ways to grow their business.
01:55
Google.
01:56
Facebook.
01:57
Apple.
01:58
Amazon.
01:59
Microsoft.
02:00
To you, they might be bonds or stocks like Walmart and Costco.
02:03
That's fine; the point is they're positions you treat as cash but that don't lose value
02:07
to inflation like cash does.
02:10
So, if you include those, I'm actually about 55% cash right now.
02:13
If you were considering putting a little more cash than usual into your own account, now
02:15
might be a good time to get it in there.
02:16
I'm not saying spend it, I'm saying have it ready so you're not waiting for transfers
02:17
to complete when you want to be spending it sometime in the future.
02:18
All we're doing here is being proactive, not emotional.
02:19
Okay, with the housekeeping out of the way, let's talk stocks.
02:20
I'm going to go through them roughly in order from least risky to most risky, starting with
02:23
ETFs.
02:24
The first fund I'm watching right now is META, the Roundhill Ball Metaverse ETF.
02:29
This is a fund that gets rebalanced quarterly by a panel of experts and is filled with around
02:33
40 great stocks.
02:34
The top holdings in this fund are NVidia, Roblox, Microsoft, Facebook, and Unity.
02:40
As I said, Facebook and Microsoft are very defensive positions which really help limit
02:45
the volatility of this fund.
02:47
Its holdings also include semiconductor companies like Taiwan Semiconductor, Qualcomm, Apple,
02:53
Intel, AMD, and Skyworks, which are again very reliable growth companies over long periods
02:59
of time, since they make most of the computer chips on the planet, among other things.
03:04
The META fund also includes content companies like Unity Software, Sea Limited for their
03:09
Garena Platform, Take Two Interactive, Electronic Arts, and Activision Blizzard, as well as
03:14
plenty of fintech and e-commerce companies like Amazon, Sea Limited, Coinbase, Alibaba,
03:20
Square, and Paypal.
03:22
The big thing about this fund is it's filled with companies that are driving the Metaverse
03:26
forward, which means its holdings will all benefit from that idea as it becomes more
03:30
mainstream, but none of them require the Metaverse to happen in order to succeed.
03:35
Companies like Nvidia and Microsoft and Amazon and Apple, all of which sit near the very
03:39
top of the fund, are going to be fine if the Metaverse never comes to be.
03:43
So, this quarterly updated Metaverse Index Fund is my pick for the least risky but still
03:49
great growth investment you can buy right now.
03:53
Next up, we have ARKK, ARK Invest's flagship innovation fund.
03:57
This fund is filled with the exact stocks that are getting hit the hardest, but it's
04:01
actively managed by Cathie Wood
04:19
and
04:39
is pretty well diversified in terms of the kinds of technologies it holds: genomics,
04:49
robotics, energy storage, blockchain technology, and artificial intelligence are all themes
04:54
that show up in this fund.
04:55
ARKK's top 5 stocks reflect that diversity pretty well: Tesla, Teladoc, Roku, Unity Software,
05:00
and Coinbase are five companies that have very little in common.
05:02
I treat ARKK like an innovation index since it contains companies working on technology
05:07
platforms in all those different areas, except its holdings are updated daily.
05:12
When ARKK crumbles like this, that tells me that something is going on with growth stocks
05:16
and the broader market in general, not the companies themselves.
05:21
Since this is an actively managed fund, you're not only getting a diverse set of growth stocks
05:24
from all areas, you're getting Cathie Wood's management and all of ARK Invest's highest-conviction
05:27
research as well.
05:28
Since ARKK is the same financial product no matter the price, the cheaper it becomes,
05:30
the more attractive it should be.
05:31
In my opinion, if you loved this fund earlier this year, now is a great time to consider
05:34
averaging down.
05:35
I just did that in my personal portfolio.
05:40
The first single company on the list is Meta Platforms, formerly Facebook.
05:45
Meta Platforms is an extremely safe, stable, and diversified business today that's still
05:50
growing like crazy year over year.
05:52
Meta Platforms has slid around 20% in the last 3 months and is now sitting at under
05:57
850 billion dollars in market cap.
06:00
That's pretty crazy, considering they own Facebook itself, Instagram, WhatsApp, and
06:04
Facebook Messenger, which are four of the top 6 or 7 most downloaded apps across all
06:10
mobile devices, Apple, Android, or otherwise.
06:14
A lot of people rightfully point out that Facebook's growth is slowing down in terms
06:17
of daily and monthly active users.
06:20
That's true but that's because, you know, more than a third of all humans alive are
06:24
already on their platform.
06:25
They're clearly shifting their focus to increasing average revenue per user, which they've increased
06:30
by double-digit percentage points year-over-year around the world.
06:34
They also own Oculus line of virtual reality headsets, which are the hands down the most
06:38
popular VR headsets on the market today and will do a lot for them in the future.
06:43
This is a stock that Cathie Wood holds inside ARKW, ARK Invest's fund themed around the
06:48
next generation of internet applications.
06:50
It's also a top position in the META ETF, and one of my favorite cash-like positions
06:56
in my own portfolios.
06:57
I think the low 300s is a great price for the stock.
07:01
Next up is Alphabet, the parent company of Google.
07:04
I'm actually struggling to find a market that Alphabet and Google don't compete in.
07:08
Everything from dominating search and email and web browsing, to making their own phones
07:12
and operating systems and smart TVs, to self-driving cars with Waymo, to building the most advanced
07:18
artificial intelligence applications ever with programs like DeepMind and AlphaFold.
07:22
Google even owns YouTube, so when I ask you to hit that like button and subscribe to the
07:26
channel with all notifications turned on, what I'm actually asking you to do is tell
07:31
Google's video content matching algorithm to put more of my content and other content
07:36
like it in front of you over time.
07:38
Like Facebook, investors who think Alphabet is out of room to grow probably haven't looked
07:42
at the stock for a while.
07:44
It's up 65% year to date, even with this most recent downturn.
07:48
My point is, Alphabet isn't the kind of company that cares too much about inflation and does
07:53
just fine during lockdowns.
07:55
It's another great all-weather company that's held by Cathie Wood, this time in ARKQ, ARK
08:00
Invest's fund themed around the autonomous revolution, as well as ARKX, their newer space
08:05
exploration fund, and in the META ETF as well.
08:09
If you've been following along with my portfolio project as an Insider tier Patron on Patreon
08:14
or channel member right here on Youtube, you've noticed me buying a lot of Google stock lately,
08:19
since I treat it as a cash-like position.
08:21
Alright, now let's get into the more risky positions.
08:24
First up is Sea Limited.
08:26
If we go to Public dot com's page on Sea Limited, we can see it's actually three companies in
08:31
one: Garena is their digital entertainment and gaming brand, Shopee is their e-commerce
08:35
arm, and SeaMoney is their digital payment solutions.
08:38
If each of these business units were a separate company, I'd have all 3 of them in my portfolio.
08:44
I'm not kidding.
08:45
Garena is the Southeast Asian publisher of some of the most downloaded games in the world
08:50
like League of Legends and Free Fire, which it also developed.
08:54
Shopee becomes one of the dominant e-commerce channels in every country it touches and SeaMoney
08:59
is one of the fastest-growing Fintech units I've seen a company create.
09:03
The fact that you not only get all 3 with one ticker but they all talk to each other
09:08
and share resources makes this my absolute favorite company to hold for the long term.
09:13
I think that Sea Limited could be a 1 trillion dollar company one day and it recently slid
09:17
back down to a 100 billion dollar market cap, meaning I think it can 10x from here.
09:23
Will that take time?
09:24
Definitely.
09:25
Can it go lower?
09:26
Definitely.
09:27
Would I buy this stock at this price and hold it for the long term?
09:31
Definitely.
09:32
One thing I love about Public dot com is they have a little indicator showing why they think
09:35
a stock could be down right now.
09:38
Shares of streaming, social media, and gaming companies are trading lower amid overall market
09:43
weakness as new pandemic concerns weigh on stocks across sectors.
09:47
So, literally, nothing to do with the company itself.
09:50
Another thing I really love about Public dot com is they really focus on investor education
09:55
and learning about companies, not just stocks.
09:58
As a result, they end up featuring my deep dives on stocks quite often and my video on
10:03
Sea Limited is no exception.
10:04
If you want to know why I'm so confident in Garena, Shopee, SeaMoney, and everything they
10:09
share, I made an episode covering it all.
10:12
It's even got Jackie Chan.
10:19
I'll leave a link to that in the top right-hand corner of your screen and in the description
10:30
below as well.
10:32
Next up we have Twilio.
10:33
Twilio is a B2B cloud communications company that allows software developers to build all
10:38
sorts of web-based tools like automatically sending and receiving texts, phone calls,
10:43
Facebook and Instagram messages, emails, and so on.
10:46
All sorts of businesses use the Twilio platform and they grew revenues by 65% year over year.
10:52
Twilio is ARK Invest's 11th biggest position overall with just over 1 billion dollars invested
10:58
in it.
10:59
I definitely owe you a dedicated episode on Twilio and I promise I'll do it in the near
11:03
future.
11:04
Let's look at the Public dot com page for Twilio as well.
11:08
Shares of several companies in the broader tech sector are trading lower on continued
11:11
volatility amid pandemic concerns.
11:14
Weakness from DocuSign and Asana earnings has also weighed on the sector.
11:18
So again, absolutely nothing to do with the company itself.
11:22
If we scroll down a bit, analysts are currently giving Twilio a strong buy rating with a price
11:26
target of almost double the current share price.
11:29
This is why I often use Public dot com's website as a starting point to figure out what's going
11:34
on with a company and its stock and why I asked Public to be a sponsor for the channel.
11:39
So, whether you're looking for a new home for your own portfolio or you just want a
11:43
different way to support the channel, you can go to public dot com slash ticker symbol
11:47
you and you'll receive a free slice of stock worth up to $70 when you fund your account.
11:50
Public dot com is free to use with no account minimum to get started, doesn't charge fees
11:51
for standard trades, and allows you to buy slices of stocks for as little as one dollar.
11:52
So that free slice of stock when you fund your account is a win-win if I've ever heard
11:53
one.
11:54
I'll leave a link to that exclusive offer for you in the description below as well.
11:57
Crowdstrike is a leading cybersecurity company that protects customers by leveraging its
12:03
security cloud solution to stop breaches.
12:05
Cloud technologies have transformed companies in a wide variety of market sectors, and cybersecurity
12:06
is no exception.
12:07
Crowdstrike runs a software as a service platform called Falcon, which is an endpoint protection
12:10
platform that detects, prevents, and responds to cyber threats and attacks.
12:15
An endpoint is just an access point – think laptops and desktops, mobile phones, servers,
12:21
and so on.
12:24
Like I said, Falcon is a platform, which means Crowdstrike and their partners can extend
12:28
it by building and deploying new modules to provide customers with new functionalities
12:33
over time.
12:34
Because Falcon is cloud-based and runs as a single agent, it's lightweight, easy to
12:39
get up and running, and provides nearly instantaneous value, which can't be said of a lot of cybersecurity
12:45
services.
12:46
In a world where more and more businesses are going digital and more and more cyber-attacks
12:50
and data breaches make the news, Crowdstrike is poised to grow massively, like it has been.
12:55
Crowdstrike has been trending down all month and it's almost back to its lows for the year.
13:02
This is actually the lowest it's traded from a price to sales point of view.
13:05
You won't regret putting Crowdstrike near the top of your watch list.
13:08
The final two companies are both Fintech companies.
13:11
First, we have Coinbase.
13:13
Coinbase is ARK Invest's 3rd biggest position for a reason, which is that it acts kind of
13:17
like a crypto index without being one.
13:20
So, Coinbase is a great way to gain exposure to the rise of cryptocurrencies without holding
13:25
them, directly.
13:26
Today, Coinbase makes money by charging fees on transactions.
13:30
So, the more transaction volume the better.
13:33
Let's look at Coinbase's key metrics.
13:35
Retail trading volume is up almost 5x year over year.
13:39
Institutional trading volume is up almost 9x year over year.
13:43
And more revenue is coming from other crypto assets than Bitcoin and Ethereum put together,
13:48
which is great because it means Coinbase isn't relying on the price action of any one cryptocurrency
13:53
for a majority of its revenue.
13:55
As a result, Net Revenues are up more than 4x year over year.
13:59
4x.
14:00
Coinbase also just released their own fully stand-alone crypto wallet along the likes
14:05
of MetaMask and Trust Wallet.
14:07
If we look at the stock, it's down 25% from its recent all-time high and its market cap
14:12
is now just 57 billion dollars.
14:15
Again, I would put this near the top of your watch list.
14:19
The other fintech company is Stone.
14:21
Oh boy.
14:22
This is by far the riskiest stock on my list.
14:25
Warren Buffett and Cathie Wood both hold millions of shares of this stock.
14:29
Stone is a one-stop shop that provides small and medium-sized businesses in Brazil the
14:34
Fintech solutions they need to move away from cash and join the digital economy.
14:38
The thing I want to point out about Brazil is that a lower percentage of people have
14:43
internet there than in the US, Canada, and Western Europe, meaning Stone's base-level
14:47
market is still growing year over year as more and more people gain access to the internet.
14:53
Stone has a point of sale solution for accepting credit cards, digital wallets, and QR codes,
14:58
kind of like Square's payment terminal.
15:00
In addition, they help businesses complete fully online transactions without any physical
15:04
devices by generating payment links that can be sent to customers for quick and easy sales.
15:11
Stone can support micro-merchants and very small vendors without actual storefronts or
15:15
websites, which greatly expands their total addressable market.
15:19
That kind of scalability is important to long-term growth.
15:23
However, fintech companies in emerging markets come with real risks.
15:27
For example, in Brazil, merchants have to put up a certain amount of collateral to get
15:31
a business loan or credit line.
15:33
That collateral is registered with one of a few registries in Brazil, made by the Brazilian
15:38
government, so this registry isn't something Stone built, it's a new collateral system
15:42
that they have to integrate with and keep up with as it changes.
15:46
Due to a malfunction in these registries of receivables, merchants could put up collateral
15:49
with Stone, then go apply somewhere else for financing and reuse that same collateral,
15:54
because these registries don't talk to each other.
15:56
That's a big malfunction and it resulted in Stone issuing a lot of non-performing loans,
16:01
which showed up as BIG losses on their balance sheet over the last few quarters.
16:06
That's what caused the start of Stone stock's landslide.
16:09
Other than these non-performing loans though, Stone's business is growing very fast and
16:13
performing very well.
16:21
Compounding that landslide are all the things I've been talking about for the last few weeks,
16:32
like fed tapering, talks of raising interest rates, the pandemic — the same things causing
16:36
ALL of these stocks to slide, which is why I made this episode as well as the last few,
16:42
which I encourage you to check out as well.
16:44
Comment below or tweet me at Ticker Symbol YOU with your thoughts on these stocks and
16:48
ETFs.
16:49
Do you like the safer ones more or the risky ones?
16:52
Were some of these on your watchlist already?
16:55
Do you have your own price targets for them?
16:57
I'm excited to hear your thoughts.
16:58
Either way, the best things you can do right now are: don't panic sell, start proactively
17:04
building up cash and cash-like positions, and fill your watch list with stocks and funds
17:09
you'd be happy holding through landslides like the one we're going through right now.
17:15
Stay informed, stay long, and stay strong.
17:18
Thanks for watching and until next time, this is Ticker Symbol YOU.
17:22
My name is Alex, reminding you that the best investment you can make… is in you.
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