Keeping You Ahead of the Curve By Shannon Sands, Publisher, Dent Research Since 1894, the First Monday of September has been dedicated to the achievements of American workers. We celebrate the contributions workers have made to the strength, prosperity, and well-being of our country.
As we head into our long weekend – the unofficial end of summer and what we here in Ocean City, MD affectionately deem the start of the "second season" – I'd like for you to join me in thanking all the people on the Dent Research team for all they do behind the scenes. Day in and day out, these men and women work hard to help you stay ahead of the curve, navigate these irrational markets, and grow your investment account balances.
From the editorial team – Teresa, Chris, Jen, Allison, Danny, Ben, Jocelyn and Charles – to the marketing team – Megan, Amanda G., Kelly, Jennifer, and Amanda K. – to the support teams – Bo, Kerri, Danny, KJ, Mary, Ana, Monique and Dave – to our customer experience team – Brandt, Jacquie, Franklin, Ian and Brittany – to the Editors themselves – Harry, Rodney, Adam, Charles, John, Lance and Ben…
Each and every one of them dedicates their days, and often their nights, to helping you. So to all of them, on behalf of all of us: Thank you!
And thank you to YOU too, dear reader.
Without you, we couldn't do what we love to do.
Before you enjoy your Labor Day Weekend, here's a quick look at this week's events here at Dent Research…
On Monday, August 29, Charles sent Boom & Bust subscribers their weekly 5 Day Forecast with a "we said it first" note.
In last week's Barron's, Vito Racanelli wrote about the potentially large flood of cash rushing into real estate investment trusts (REITs) due to index changes being made by Standard & Poor's, of S&P 500 fame, and Morgan Stanley Capital International (MSCI).
As of August 31, REITs will get their own sector rather than being lumped in with the financial sector. So every money manager that indexes to S&P or MSCI will need to carve out room in their portfolio for REITs or risk being underweighted the sector (this is called "tracking error" in finance-speak).
Given the current amount of underweighting, that means as much as $150 billion in capital could be sloshing into REITs.
But this wasn't news to us. Charles was writing about it as early as this past April in Economy & Markets, and Rodney and he wrote about it extensively in Peak Income.
And that's one of the things we strive to do: to keep you ahead of the curve like this.
It's also why we're reducing the price of a seat at our October Irrational Economic Summit from $895 to just $195, for this weekend only. Take advantage of this 78% discount here. The team of great minds we've assembled for you this year includes the Honorary David Walker, Dr. Lacy Hunt, Howard Lindzon and George Gilder!
On Tuesday, August 30, Adam gave Cycle 9 Alert subscribers an update on the biotech sector after issuing a bullish recommendation on XBI the previous week. He wrote: The timing of my recommendation was hugely ironic. I mentioned the tweet Hillary Clinton sent last September, in which she promised to tackle the pharmaceutical industry's "price gouging" practices. Lo and behold, she took to social media again last Wednesday – the very day after my bullish biotech recommendation – calling Mylan's (MYL) pricing of EpiPen "outrageous." Headline-reading investors reacted quickly with selling, sending healthcare (XLV) stocks down 1.6% on the day. Biotech stocks fared worse, losing 4.3% by the day's end. But, they're holding onto the trade for at least another month! That's because Adam doesn't let the headlines – or emotion – dictate his investing strategy. Instead, he trusts the system he's developed – and that has proved itself time and time again since 2012.
As he said: "Investing success doesn't come to the smartest investor in the room. Rather, it comes to the investor with the strongest discipline."
On Wednesday, August 31, Harry release the September issue of Boom & Bust to subscribers, giving them an exclusive first look at the Bubble Model he has developed… a model that is the first of its kind.
Every time we have a major collapse in stocks, experts declare it a "black swan event." That, or they say it was totally unpredictable. Harry doesn't believe this for a second. Major booms and busts are, in fact, very predictable. And now he has a model to prove it.
On Thursday, September 1, Charles wrote to you about why it's so important that you DON'T trust your gut… that, instead, you trust the system. He related the story of Ray Dalio… In August of 1971, Ray Dalio – now one of the most respected hedge fund billionaires on Wall Street – was a lowly clerk working on the Street. By coincidence, Dalio was starting his career during one of history's critical turning points. President Nixon had just taken the dollar off of the gold standard.
Dalio's gut told him the market would crash the next day. Instead, it rallied. Hard! The Dow finished the day almost 4% higher.
It's not much of a stretch to compare then to now... Back then – as now – you had central banks meddling in the markets. And back then – as now – you had unexpected results.
Dalio learned a lesson from his experience. He realized that the market has a knack for doing what you least expect it to do… and he reached the conclusion that, rather than trying to guess what happens next, the better course was to simply build a portfolio that would perform well in any environment… no matter what happened. So he launched his All Weather portfolio, and the rest is history. Now, we're not necessarily recommending you run out and invest with Dalio. Even if you wanted to, you wouldn't meet the minimums. You'd need $5 billion in investable assets to get in the door.
But we do recommend that you take a few plays out of his playbook… Read the article for full details.
And finally, on Friday, September 2, John explained how his Forensic Investor subscribers were recently able to bank a 30% gain by selling short GIII Apparel. John had six tip-offs that the stock was in trouble. You can read about them here.
Happy Labor Day,
Shannon Sands
Publisher, Dent Research
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