It would be nice if the path were always clear or the choice always obvious. But a life aimed at the long haul is a little more complicated. No guarantees, but at least there’s plenty of good company here in the messy real world.
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Life in the 21st century can be grand, huh? We’ve got a few things in our research efforts that are proving quite exciting.
Maybe you’re seeing some of the connections, too?
Of all the news, of all the opportunities available, we’re seeing some common threads—ones that may very well be investable.
Specifically, regarding our tech, our platforms, our power: we’re excited about the potential for faster, more efficient connectivity that could drive future growth in the uses we enjoy from our devices… and then ones we can’t yet imagine!
No recommendations, no guarantees, but… it’s interesting.
New tech is one part of this story. We’re welcoming the latest generation of OLED TVs, smartphone screens that flex and fold, and a form of lighting even more efficient than LED. One company dominates the patents and research and royalties for this stuff.
The second bright spot we’re watching: there’s a social media company (that is not in political trouble and not headed by a controversial billionaire). Per Marketscope Research, its earnings are expected to double each year for the next three. No guarantees, of course.
Another dot: certain sector-leading companies are trading at a discount to the market average valuation. In fields from biopharma to grocery stores, from retail health to food processing, their recent dividends indicate yield between 2 and 3%. Further, it costs $10 billion to build a new semiconductor foundry, and the leading provider of custom chip manufacturing has more than 50% of this growing and vital market. It’s not nothing.
Keep in mind it’s going to take a lot of copper—more than we’ve ever mined before—to build out the next energy revolution. It will include solar and batteries and electric vehicles, and stock in two large miners is still trading well below the levels they reached ten years ago.
Clients, we spend more time and thought than ever before in reading and thinking and researching, trying to sort out investable opportunities to grow wealth in this unfolding future.
We’ll have hits and misses and ups and downs; investing can be volatile. But it sure is fun to try to spot these brightest constellations in the investment universe.
Want to talk about this or anything else? Write or call, any time.
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Play the audio version of this post below:
In psychology, “black-and-white thinking” is a defense mechanism that helps the brain cope by pushing things to their extremes. If there is a crisp division between “right” and “wrong,” things are easier, yeah? It’s not so overwhelming to decide how to behave if we can boil a situation down to two basic options.
Like a lot of fairytales, it sure does sound nice on the surface.
But so few things in life are truly black-and-white, all-or-nothing, either/or. The problem with “black-and-white thinking” is that it’s almost always a logical fallacy.
And a logical fallacy is just that: it is false, illogical. You can‘t reason with a fallacy. You reject it and find a frame that suits the situation better.
So why do people avoid hanging out in all that gray between black and white? Because gray is blurry. There are way more decisions to make when we navigate the gray.
I’m sorry to say it, but life is already mostly in the gray in-between. And it is no time for us to splinter into camps when we all could stay on the same team. Nebraskans are suffering tremendously as COVID-19 continues to move through our communities and swamp our hospitals and care systems.
What if we didn’t splinter in the face of such challenges? It is easier to hang out in the gray when we accept that we are here together. The extremes get lonely: we’d rather face reality and work through it with each other.
Across the coming years, we will learn more about the science of this pandemic and the damage it will continue to inflict even on those who survive. In the meantime, we don’t need things to be totally “black-and-white” to move in the right direction.
Stay safe enough.
Avoid unnecessary risks.
Use our resources as wisely as we can.
What do we stand to gain when we hang out in this blurry space? We get share each other’s strength in this tough time. We get to hold out some hope for the road ahead, the other side.
Clients, we’re grateful to get to work with you, even in this tough time. Have questions about your own options? Let’s talk.
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Psychologist Shawn Achor wrote about crisis and adversity, recurring features in both the markets and life. Stuff happens, as they say.
Achor says there are three alternate mental paths in the aftermath of crisis.
The first one leads nowhere. We simply expect the crisis conditions to continue. The second one leads downward to more trouble, a continuation of the trend. We humans do tend to believe current conditions or trends will continue.
Finding the third path is difficult when times are tough. Many people do not see it because they do not believe it exists. The third path leads from the challenging conditions to greater strength, capabilities, opportunities and success. Think of it as falling forward.
Studies show those who conceive of failure as an opportunity for growth are more likely to find the third path, and experience that growth. Others have talked about the same concept with words like resilience and grit, or more vividly, post-traumatic growth.
We see this pattern in the investment markets. Although historically the stock market has recovered sooner or later from every downturn, some investors do not recover. Those who can only see the first two paths have a hard time staying invested. If they sell out at low points, believing the crisis conditions will continue or worsen, what might have been a temporary loss becomes permanent.
By the time they see the third path, the market may have already recovered. Their diminished pool of capital can only get reinvested at higher prices, perhaps to repeat the cycle of crisis and loss.
Fortunately, here at 228 Main you clients tend to have productive attitudes toward investing. You can see the third path, which is a big advantage. If you would like to talk about this or anything else, please email us or call.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
All investing involves risk including loss of principal. No strategy assures success or protects against loss.
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