Protect your earnings from recession | The best business coach | Simon Severino

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Protect your earnings from recession | The best business coach | Simon Severino

 

Moving from growth stocks


Hey everybody, a quick market update for the sprinters out there because the news are so bad and the emotions are going high. And as we learned as investors, when the emotions are high, we just go back to our systems. We try not to get caught up in, in emotions. Let's go to the numbers, let's see what is happening. Where is the money flowing to where is it flowing away from and how can we rebalance accordingly so that we catch the upside and we reduce the downside. So in the last live view session, I've shared with you one segment rotation that is really, really important to get. We are moving from growth stocks, specifically tech, and it related growth stocks to energy commodity is because there will be well there is geopolitical risk and there will be economical risk people talking of a possible recession.


Other people talking about a stuck inflation, which is quite similar, basically low growth expectation. And so when we have low growth expectation, growth stocks cannot go far. That's why if your fundamental analysis on them is right, they are still something to keep. But if you want to de-risk you have to check the moves that we shared last week in the live sessions on YouTube, which is rebalancing your portfolio to include the bull runs. And the bull runs are right now. Agricultural supply demand play. Russia is not a big GDP nation, but it's a big natural resources export region that leads to a squeeze. They were delivering wheat and other commodities to the world. The demand for commodities is still high. The super supply is lower basic economics. The price is going up. That's why of all today's markets, everything red, except energy utilities and some basic materials. Commodities. Last week, we have seen, we've looked into specific commodity produce stocks, commodity producer, ETFs that you might wanna buy. And I've been sharing last week was I was selling what I was buying. Let me share also this week, what I was selling, what I was buying and how you might prepare four, three possible scenarios scenario, a the growth case. We have hyper growth in 2022. Like we had it in, in 2020. I think the probability is


Five, 5%. Then we have base case base case is we have slow growth. In that case. I think the probability there is 40%. And then we have the third case, which is negative growth or no growth calculations slash recession.


And that has a higher probability from my perspective. And if we hear the macro experts today, I was hearing RA Paul. He think recession is, is here. It's not come it's here. He looks at commodity squeezes. He looks at the energy bull run right now. And he has been buying bonds and gold over the last weeks. Now he didn't share everything, but we have also been buying gold over the last weeks. And that was a very good idea. In, I hold now four gold producers. So stocks of gold producers, one stock of silver producer. I'm happy to share if you, if you wanna know exactly which one they are. I just look for them, which, which are solid in terms of cashflow have a low price to earnings and price to sales ratio. So have basically are doing well in the recession. They are liquid. They, they have enough cash flow and liquidity and they are cheap right now. And and they're all going up. Of course, Let's, let's look at some of them maybe. So this is the market right now. We have technology down, we have financials down, we have communications down, consumer cyclical down in healthcare. We have only Johnson and Johnson with plus one. And then we have consumer defensive, even down with one exception, Costco, and then we have industrials down real estate, down energy, up utilities, up basic materials. Some of them up


Let's have a look right there and I'm understanding more and more why, or like bill gates started to go into agriculture because we will have a strong squeeze there. Same look at the crypto markets. They are recovering right now. So one hour ago they were red. You have just seen them switch right now, life they're beginning to, to recover, but it was a tough, tough last 20 hours. And let's look a little bit at the single position, right? Canadian, natural resources. We bought them in the beginning of January and they're doing super strong. We are up around 26% since, since we bought them. So congrats everybody, national Canadian, natural resources, a dividend stock, very, very solid because of the natural gas and commodity site that it is in same thing with next era, energy doing really, really well. This one is still a buy Canadian.

Focus on your portfolio


I wouldn't buy this week anymore. I'm happy I did in January, but they're reaching the top right now, different from next era energy because they have some room for growth and they look well, and I have been buying more of them just two hours ago. If we look at the energy sector, this is an ETF that just looks at the overall energy sector. As, as a single unit, it's a clear, it's a clear, bold run. And this is for multiple reasons that we have explored last week. The, but to, to sum it up, supply lower than demand. And it's just the beginning. The energy play is a structural play. This will not be solved over the next three years. So if you want get, if you want to add one assumption to your assumptions, add the thesis to your list of thesis that your portfolio has been.


This one is a strong case. Look at energy situation, look at the world, what the world needs in terms of basic elements. Look at water, look at fertilizers, look at, and when we talk, fertilizers, nutrient has been one of the best picks of our January and February sessions, nutrient create fertilizers. And how do you grow food? So what will the world need? Food, water? How do you grow food? You need fertilizers. You need specific raw materials, basic materials in the earth, and they are, and they right now shooting all up. Same thing with M OS the Moai company, fertilizers look at this chart. So of course now it's too late. We have been buying in January and in February, February was still a good time to go in. I wouldn't touch them right now, but I am super happy that we have built up this position in, in, in February together.


Congrats. If you went in, look at sand sandstorm, that's a gold producer. So they produce gold and they, they have some room to grow. So they might still be something that you wanna look at, do your due diligence. You can use our 10 step checklist. And then after you did your fundamental due diligence, you look at the charts. Charts is actually not looking bad. So there is some room to grow here. And definitely this is a short term opportunity, long term. I'm not enough of an expert in, in terms of gold. My, my goal to exposure has started since I'm long Bitcoin, long gold since January I've never bought called so far because the situation was never as it is right now, gold. Yeah, that's very gold. And the name tells you what it is. It's another gold producer. And this is at all time high.


I wouldn't buy it now, but it has helped our portfolio in our sprinters communi stay green as basically all portfolios were red because we have added this part. And this part is really boomed. Now, I don't want to bore you with all the single stocks, but definitely if you're looking for a silver play pass is the American silver corporation, which I think is really interesting because silver is one of the elements that has this lower, lower supply than demand. And because it has industrial use. So pioneer, natural resource is actually very nice stocks also, and energy play that we have been doing it's right now in a, in a little deep, but look where the deep is. So this is absolutely over about don't touch it right now, but it's one of the good ones and the keynotes is struggling. I don't know why kenros gold is really struggling.


And you, you might wanna watch this one. I think this is definitely one worth watching. And then we come to the cryptos Bitcoin slowly covering 38.5 is at the bottom. Nobody knows. Depends on so much geo geopolitical things. Is the world really looking at Bitcoin right now as being a safe heaven? I don't know. I think gold is right now what the world sees as a safe heaven. I think Bitcoin has still some work to do. We need some adoption. We need some, some more proof, but definitely the, the world is marketing Bitcoin. If you look at the, the geopolitical conflicts, this is what people wanna wanna have. So yeah, the marketing, the world is becoming a marketing department for Bitcoin, but I don't think we are there yet. I am long Bitcoin. I'm long gold I'm massively overexposed Bitcoin.

Out of the stable coins


And it stays that way. I've never, never sold one. And I don't, I don't think of doing it. Solana Solana is in a very cheap situation. I think Solana is very undervalued. We have been analyzing the hell out of Solana. We are looking at developer flows and at every single technical economical Undo's number Solan, I'm still a absolutely bull Solana. And if, if I, if I hadn't already a lot of Solana, I would be buying every week, but I have been buying every week for the last year. So Ethereum is weak and doesn't surprise us a lot. They need to deliver avalanche was really strong over the last days. And now might come back into a zone where you might snip it. Luna. I have been staking some of my Luna because I had too much stake than I wanted to sell.


And I couldn't because it takes me 21 days to untake on the but yeah, they're around 80 right now. I see them easily at 100. And at that point at 98 we in our community, we would have doubled. And so that's the time where you should take some profits from Luna, but there are such bull news there I'm, I'm quite bull Luna. Now they're not the, the main, the winner in the stable coins sections. The winner in the stable coin section is S D C. And by the way, I've been increasing my stable coin positions over the last weeks, because yeah, we might have, have some, some buying opportunities coming up. I have sold all my Phantom still believe in Phantom, but I think that now that one of the codes has, has gone, I think there will be a negative fund around it for a while.


And I don't wanna be in these fat waters. I might get in later. Again, I think 1.3 is a very good price for Phantom, but the overall sentiment is so negative around everything that is risk on that I don't add risk on right now, I reduce risk on. So I sold all my Phantom and I've put that into stable coins, U S D C to be specific. And, and I'm waiting to buy soon. As soon as the trend reverse right now, nobody knows what's going on. Nobody knows what the geopolitical situation is, and nobody knows what the market is. So what do we do in this situation? We just wait for clarity and make ourself ready for clarity. What does the tennis player do after, after the ball got to the other side, his centers, his centers, and is ready for the ball coming back.


So this is moments to centering. What is centering in portfolio construction is going your overall allocation and looking at the overall story. So let me show you my current overall allocation. This is my, my stock portfolio and I'm crypto assets portfolio. If you look at the stocks portfolio, I'm still overexposed growth stocks. That's a blue one. But I am adding now over the last week, every week, I'm adding commodity ETFs, energy ETFs, single fertilizer stocks. I think I'm at five fertilizer stocks. One. Now the best ones were nutrient NTR and the mosaic company, M OS I have added dividend stocks. And especially from the utility, this space, energy space, basic material space, I've added commodity stocks, commodity ETFs. Two of them are doing really, really nice. One is run by BlackRock. One is run by lake. That was a friend of mine who told me that.


Thank you for that. And I'm still overexposed digital assets. So over the next weeks, I'm reducing my digital assets. I'm reducing the growth stocks in the ratio compared to dividend fertilizers and ETFs energy, energy, ETFs, and commodity ETFs, which I want to increase. So I want this ratio to become less risky. It's too risky. That's not a good portfolio to have right now. So it's time to rebalance, right? But you need the right time. Of course you wanna sell high and you wanna buy low. So it's not just selling and buying in panic, but being patient, do your homework, do your fundamental analysis, do your technical analysis and then buy at the right moment, sell at the right moment. So I'm still too heavy Amazon Google, but I have added some energy place. And I'm of course in the reds with MicroStrategy, PayPal, clean spark Coinbase, Shopify square really in the red with them, but the fundamentals are there.

 

The segment rotation



I will just reuse the exposure there, but I believe in them long term in three years, they're doing really, really well, but this year. Mm, I don't think so. So it's okay to have positions in the red when you really believe in them and just to wait and hold them five years, but you don't wanna have your whole portfolio in the red waiting, right? At least I don't, if, if you want it, please do it. I want parts of my portfolio, one third to generate revenue right now. And, and that's what we did with the segment rotation. Now on the crypto side of thing, I have consolidated into the top five.


So I am now only long Bitcoin with 57%, then Solana with 21, Ethereum with 13 Luna, with five and avalanche with 1.6, I have sold all my fantom and all my engine. And I've sold also Soland which was you, which was a, a mistake in the first place much too risky play didn't pan out. And so, but, but when you go risk play, you have to know that you need hundred bets for one to, to work. And I knew it didn't work. I consolidated at a loss. I sold at a loss and I consolidated that into stable coins. Us D C, which is the smallest slice in here in terms of the thesis. My main thesis is the world needs a true store of value. That thesis is validated and, and every day the world is talking about it. If you, whatever newspaper you talk about right now, the world is talking about that the current store of value, the fit currencies are imploding, and the world is looking for a more stable store of value.


So, and they're searching like crazy. And some of them find it in gold. Some of them find it in Bitcoin. I am long both, and this is my Bitcoin play. The second thing is smart contracts, still traditional financial world is being disrupted into a decentralized world. And also into the age of autonomy. We will have soon agricultural machines working and then sharing in a common database that is on a blockchain, of course, sharing with the robots, what to sell, and then the robots bring it to the market and sell it. They bring back the profits, they reinvent, they reinvest in, in machines, in productivity, et cetera. And that whole thing will need smart contracts. So long term, still bullish, smart contracts. And we are seeing them really, really get better every week. And then 1% right now is stable coins. And I will increase this 1% up to 10% over the next weeks as we move forward. This is some ideas about your portfolio and what you can do, whatever you need me know, and I'm happy to analyze it and share my findings with you. And keep rolling everybody.

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