High Conviction Investment Ideas Now

[anitya]

This thread is for posters to share their high conviction Ideas to invest now. 

Posters are free to state the timeline within (or by) which they expect their idea to come to fruition.

If there is enough interest this can stay as a perpetual thread.  

[anitya]

Between today and tomorrow, I need to buy something high conviction to roll proceeds from a potential sale in the next 24 hours. Any suggestions would be appreciated.

[richardsok]

LONGER TERM: If, as johntaylor writes, we're going to need 2x or 3x electrical capacity 25 years from now, that would appear to predict we'll need to overcome our irrational voodoo fears of nuclear power.

Now project the inevitable continued growth of government borrowing as the $trillions owed approach infinity and long term inflation seems inevitable. Even the Fed cannot outlaw arithmetic.

Then there's AI and driverless automobiling.

Put it together, for longer term dollar-cost-averaging I'll opt for (1) productive real assets like farmland and (2) AI ETFs like AIQ or AIO or ARKK (3) nuke/utility exposure RBLD, CEG, FXU

Of course, all depends on a generally peaceful world. Should a big war break out, forget everything I think.

FOR 2024
I cannot make any short term predictions, dependent as we are on events. With the bulk of my assets I intend to continue following low-volatility technical indicators such as AOM with speculative position in ARKK. (For very short term speculation, thinking to trade FNGU / FNGD opportunistically. Also maybe BTAL for bearish hedge when needed. This bull mkt isn't going to last all year.) XOM and PFE may be in opportune dips with enough dividends to make a wait palatable if I am wrong. IBM appears strong. I have liked BRK/B but cannot take a large position until Buffet leaves the investment scene. He is still buying big blocks of OXY. Might go there.
With my smaller income bucket I hope to continue playing and rolling preferred ETFs and Pimco CEFs to max distributions.
2023 was a good year. I wasn't smart enough to buy and hold Apple, Berky or MSFT back in 1989. So I hope to compensate and , continue to be an alert and decisive trader.

As pony so beautifully expressed, "....I’m not necessarily looking to beat anything. I’m just looking for reliable long term gains and a balance of risk..... the never ending pursuit for the holy grail of portfolio construction which doesn’t exist because of future unknowns."

Stay healthy, everyone, and Hap Nw Yr

[bb2]

High conviction is a tough one without a big slump, so cash maybe? Otherwise, MSFT, CRM, NOW, AMZN. And if you can find a Sojourn Pinot Noir, west sonoma, I'd suggest that.

[chang]

Dec 28, 2023 20:36:44 GMT anitya said:

Between today and tomorrow, I need to buy something high conviction to roll proceeds from a potential sale in the next 24 hours. Any suggestions would be appreciated.

Why the hurry? Remember, cash is paying 5% now.

This thread is in "Stock Squad", but I'm guessing you're opening the discussion to more than just individual stocks.

I recently added to (1) US small cap, (2) Foreign large & small cap, and (3) EM, based largely on RTTM. See here:
big-bang-investors.proboards.com/post/45166/thread

I'm not sure whether the traditional Large Growth EMs (FEMKX, WBENX, etc.) or the "Value" EMs (SIVLX, AEMGX, etc.) will do better coming out of their multi-year slump. Or maybe EM small cap will lead them both. I'm guessing they will all do well. I am ear-marking my 2024 IRA contribution for this space.

As to US small caps ... it boils down to the predictive power of the Callan-type charts and RTTM. I wouldn't bank on that, but I do think RTTM is a real "thing"; it provides some direction and, eventually, some pressure. (Disclosure: I've always been contrarian, value-leaning, and early; as opposed to a momentum-based, hot hands type investor.)

Someone mentioned nuclear - I agree, but I expect that would be at best a "mad money" play for most of us. Who's going to sink 20% of their portfolio into Cameco and EDF?

On the subject of RTTM, see the "Utilities" thread. They've had a lousy year or two. I also added there recently. Probably not going to deliver a 75% return in 2024, but maybe just a solid return with less correlation to the MagSeven? (IMO "High conviction" doesn't mean expectation of a high return, it means a high level of comfort and an expectation of a better return in the near future than in the recent past.)
big-bang-investors.proboards.com/thread/2607/utilities

[anitya]

chang,

You are right I did not mean the thread to be limited to stocks. Any high conviction investment, including debt securities, is a game for this thread. (I think I just used Kathie's thread location.) For somebody like me who reads "Recent Posts," location does not matter but it probably does for a big %age of members. So, please feel free to move it to an appropriate location.

I shall read the rest of your post tomorrow.

[anitya]

Sold 60% of META. I had previously moved Meta from Roth to Taxable when I thought it moved up too aggressively but I was wrong and it nearly doubled in the taxable account. Bought PFE with the proceeds from the sale. So, I guess you can say it is my current high conviction buy. I may have to move it to an IRA as it pays 5.6% dividend. Today, I also sold some long rate sensitive equities from IRA and rolled the proceeds into PFE.  This pushes my HC sector bet higher which is not my intention.  I may have to sell some HC sector funds so I am not even more overweight HC. 

Fell asleep at the wheel on PFE as my initial purchase was 8% lower.

[uncleharley]

FWIW; I like IBM for the foreseeable future. That could be a week or a lifetime depending on one's abilities.

[archer]

Nothing fancy here. I expect my QLD to make a good showing. For something more specialized, I agree with previous posters on nuclear energy. I'm holding NLR, which holds a lot of power companies that have nuclear plants, as well as mining.

[chang]

It looks like 2024 will be a busy year for space launches:

www.foxweather.com/earth-space/2024-rocket-launch-calendar

I’m actually thinking of putting some money into ARKK and ARKX. (ARKK combines the investment strategies of the other ARK funds — internet [ARKW], robotics [ARKQ], genomics [ARKG], fintech [ARKF]) — but not space exploration [ARKX].)

I’m probably a little late to the AI party, but maybe not, if I look on this as a 10-20 year long experiment.

Am I completely bonkers?

[uncleharley]

Dec 30, 2023 13:21:16 GMT chang said:

It looks like 2024 will be a busy year for space launches:

www.foxweather.com/earth-space/2024-rocket-launch-calendar

I’m actually thinking of putting some money into ARKK and ARKX. (ARKK combines the investment strategies of the other ARK funds — internet, robotics, genomes, fintech) — but not space exploration [ARKX].)

I’m probably a little late to the AI party, but maybe not, if I look on this as a 10-20 year old experiment.

Am I completely bonkers?

NOPE!!

[anitya]

chang, You are not bonkers re AI.

I have not studied Cathie Wood active management skill to know if she is the best way to express your idea(s). May be she is. I would like somebody to take a deep dive to back test her at different inflection points and share their findings. Ron Baron appears to be less focused on marketing than she is and may be compare their products and see if one is better than the other. There may be other managers too who make futuristic bets and they could be compared as well. Clearly this should be in a different thread which if you start in the right location, we all can get to the bottom of this.

[anitya]

I agree about nuclear energy. CEG (Richard mentioned) has a God like chart. I like NLR archer mentioned which has already gone up 50% this year - it’s low trading volume is a limitation, unless one makes it a buy and hold.

If any one has kicked the tires on CEG, pl share your findings.

Given how much Generative AI has gone into stock prices, I am inclined to give nuclear energy a short term advantage over generative AI for stock prices.

[bb2]

I kinda like M*'s AI list, with moat indicated.

Nvidia Wide
Microsoft Wide
Alphabet Wide
Amazon.com Wide
Advanced Micro Devices Narrow
Tesla Narrow
ServiceNow Wide
Meta Platforms Wide
Taiwan Semiconductor Manufacturing Wide
Snowflake None

Jist of a study done of biz consultants using AI was that they found it useful. Wasn't perfect but all participants were afraid they'll be replaced someday.

The study : papers.ssrn.com/sol3/papers.cfm?abstract_id=4573321


"For each one of a set of 18 realistic consulting tasks within the frontier of AI capabilities, consultants using AI were significantly more productive (they completed 12.2% more tasks on average, and completed task 25.1% more quickly), and produced significantly higher quality results (more than 40% higher quality compared to a control group). Consultants across the skills distribution benefited significantly from having AI augmentation, with those below the average performance threshold increasing by 43% and those above increasing by 17% compared to their own scores. "

[anitya]

For extended discussion of Themes, please consider opening separate threads. For example, I just posted on the Generative AI thread to bump it up.

This thread is still the right place for the actual investment vehicles for corresponding high conviction themes. Thanks.

[chang]

Dec 30, 2023 17:54:32 GMT anitya said:

chang, You are not bonkers re AI.

I have not studied Cathie Wood active management skill to know if she is the best way to express your idea(s). May be she is. I would like somebody to take a deep dive to back test her at different inflection points and share their findings. Ron Baron appears to be less focused on marketing than she is and may be compare their products and see if one is better than the other. There may be other managers too who make futuristic bets and they could be compared as well. Clearly this should be in a different thread which if you start in the right location, we all can get to the bottom of this.

Good point. Baron got money early into SpaceX and a couple of his funds actually have approx 5% in it. It’s about the only way for you or I to actually own any.

[chang]

anitya: congrats on buying PFE just before today's jump. Good call.

[anitya]

Jan 2, 2024 19:04:22 GMT chang said:

anitya : congrats on buying PFE just before today's jump. Good call.

Thanks.  Just lucky on the timing, which was already 8% late.  I had asked you a few days ago about XBI.  I have been thinking about buying it for the past two weeks.  Today feels right, perhaps, a bit late!

[graust]

I meant to reply to this thread when I first read it in January…apologies.

My ideas for high conviction holdings right now (while Fed rates are still high) are some preferreds that are already floating, and yielding 9-10% plus:

AGNCN (yielding ~10%)….mREITs, only hold preferreds, not common
ALL-B (callable, but an easy buy at $25.50 or so)….Allstate
CUBI-E and -F (yielding 10% or so)….a regional bank, but again it’s preferreds, not commons
C-N (it’s at $29 (par $25)!!…..but it’s a special type of preferred that gets counted as Tier 1 capital so likely not callable); yields 9%
NLY-F (yielding ~10%)….similar to AGNCN above
SLMBP (yield 9-10%)….floating, and par is $100 (trading in low $70’s)

Holding these as “fixed income” in my dad’s account, along with RSIVX, OSTIX, RPHYX (ST HY funds with good performance)

Also discovering some OTC-traded foreign high quality companies that I plan to hold forever:

CNSWF (Canadian Constellation Software…look at its past chart! Only owned for less than 6 months though)
HESAY (Hermes….luxury brands)
LVMUY (Louis Vuitton)
ADYEY/ADYYF (Ayden….a Netherlands-based payment processing company that some investors I follow have ID’d as high quality)
FRFHF (Fairfax…Canadian insurance company)

Also some regular US traded stocks I will hold forever

AMZN, META, KNSL (Kinsale….insurance company….way under the radar), ADP, ACN, TSCO, CTAS, GOOG, MSFT, AGM (just raised dividend 20-plus %), APO & ARES & BN/BAM (private equity giants), CELH (new beverage/energy drink giant), LULU, LLY/NVO (I know they’re probably overbought but they’re probably heading to a trillion $ in market cap), MA/V, and TMUS (forget VZ and T)

Hold these personally and in family accounts I manage. Probably will hold forever.

Finally converted from “DGI” to GROWTH with some dividends. Wish I would have years ago (probably cost my dad a couple hundred thousand in returns before he retired. I’ve never said that “out loud” before

[kathiel]

Some of you know from my other posts that my favorite recent (October, 2023) buy is ARM. It is in the AI space for semis and has done really well. I'll assess where it is before the lock-up expires in mid-March. If the price dives from there, I will consider it a good buying opportunity.