Tag Archives: Money

Citadel Suppressing Critics with Legal Action

Evidently unsatisfied with his billions, Citadel LLC CEO Ken Griffin has won an arbitration case against a parody website:

Investment firm Citadel has won a cybersquatting dispute it brought against the owner of CitadelAir.com.

The domain owner operates a Twitter account called Citadel Air, where he parodies the investment firm and promotes the short selling of meme stocks such as GameStop (NYSE: GME).

The website shows a fleet of jets with the Citadel logo photoshopped onto them, parodying the fund’s vast wealth.

This ruling flies in the face of free speech protections.

Though Citadel claims there is a “risk of confusion,” Citadel offers no flight services. It’s a hedge fund!

If critics can’t parody a company, a key avenue for criticism is closed. And no massive institution like Citadel should be beyond criticism.

It strikes me how thin skinned Citadel is. Someone makes a website to goof on your multibillion dollar hedge fund and your response is legal action?

We saw similar unhinged behavior from Citadel when it likened its critics to deniers of the moon landing.

This is not the behavior of a well-managed company. Can you picture Procter & Gamble doing this?

No.

If Citadel is so sensitive, perhaps it means they’re hiding something. And secrets having a way of coming out.


Today marks one year for the blog! We’ve gone from 0 to nearly 300,000 views and had a lot of fun along the way!

I look forward to another great year with you guys. And if you have any ideas for content you want to see, leave a comment at the bottom.

Thank you for a great year!

More on markets:

Citadel Sues to Crush Competitors

How Solana Could Wipe Out Visa and MasterCard

AMC and GameStop Short Sellers Down $10 Billion for 2021

Photo: “Ken Griffin” by DanGPhotos1 is licensed under CC BY 2.0

If you found this post interesting, please share it on Twitter/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

Citadel Sues to Crush Competitors

“You’re the one who’s trying to regulate your way into a market victory”

Judge Justin Walker

Citadel Securities LLC is suing the SEC to stop curbs on high frequency trading:

A federal judge challenged a lawyer for Citadel Securities LLC about its efforts to thwart a new kind of market order from IEX Group Inc., the stock exchange operator made famous by “Flash Boys.”

“It’s you who’s going to a federal agency and saying stop a private entity from doing what they want to do,” U.S. Circuit Judge Justin Walker said at a hearing in Washington on Monday, after attorney Jeffrey Wall argued that the order type interferes with the natural course of the market.

The order type, known as D-Limit, has a roughly 350-microsecond delay to blunt the advantage of high-frequency traders.

Citadel makes massive sums from high frequency trading.

Brad Katsuyama created the IEX to stop high frequency traders from front running mutual funds and other investors. Now, IEX is offering a new technology, the D-Limit order, to help.

So Citadel sues the SEC to make them stop!

Imagine if Blackberry could’ve sued the government to make it stop the iPhone. Well, Blackberry might be doing a whole lot better today.

But the average person wouldn’t.

In Citadel’s defense, they’re having a tough time lately. Average investors in meme stocks like AMC Entertainment Holdings, Inc. are suing them in Florida.

And the SEC is considering a ban on payment for order flow, one of Citadel’s main sources of revenue.

It’s interesting to see who’s for the D-limit order. One proponent is Vanguard Group, which holds the savings of many individual investors, including me.

Vanguard is evidently convinced that circumventing high frequency traders will help the average investor. But for Citadel, Vanguard is competition in the market.

And Citadel will stop at nothing to win.

The only real question is: will we let Citadel lobby and sue its way to total control of markets?


This is the last blog for this week. There will be no blog next week; I’ll be visiting Barcelona!

See you on Monday, November 29th.

Until then, enjoy a few of my favorite posts. Happy Thanksgiving, everyone!

Starting a Financial Plan from 0

Citadel Builds Huge Position in AMC Call Options

Male Contraception With an Ultrasound Device?

NJ’s Best Apple Cider Donut

The Painting I Love the Most

Photo: “Ken Griffin” by DanGPhotos1 is licensed under CC BY 2.0

If you found this post interesting, please share it on Twitter/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

AMC and GameStop Short Sellers Down $10 Billion for 2021

Shares in AMC Entertainment Holdings, Inc. and GameStop Corp. have skyrocketed this year. As retail traders pile in, short sellers are nursing deep wounds.

According to the latest data from S3 Partners, shorts have lost over $10 billion in both companies for the year. And their losses are accelerating:

The GameStop and AMC short-sellers had lost $6.18 billion and $3.37 billion by the end of trading on October 26th and by the end of trading on November 4th, these losses had extended to $6.51 billion and $3.69 billion, respectively.

This indicates that during the seven trading days in between, investors who had bet against both companies had lost $320 million each for $640 million in cumulative losses.

Most short sellers are hedge funds.

If those funds were making bets with their own money, I’d say that’s their business. But hedge funds’ assets generally come from pension plans and university and charitable endowments.

To gamble the future of education, charity, or people’s retirement betting against highly volatile stocks is reckless. Were I an investor in such a fund, I’d be withdrawing my capital immediately.

Meanwhile, the best performing funds are taking the opposite side of the bet.

Renaissance Technologies LLC, one of the best performing hedge funds in history, increased its ownership of AMC by 40% in the third quarter. And that’s after tripling holdings in the second quarter.

So who’s right? I have no idea.

But I do know that betting people’s retirement money against turbulent stocks is completely irresponsible.

More on markets:

Citadel Builds Huge Position in AMC Call Options

Starting a Financial Plan from 0

AMC May Issue Its Own Cryptocurrency, Per CEO

Photo: Photo: “the Great Hedge Fund Hei$t” by eyewashdesign: A. Golden is licensed under CC BY-NC-ND 2.0

If you found this post interesting, please share it on Twitter/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

Robinhood vs. Interactive Brokers: Smackdown!

I’m working on making my own index fund. And it’s proving surprisingly difficult.

The Goal

My goal is to create a portfolio of the highest yielding Dividend Aristocrats. Dividend Aristocrats are blue chip companies that have increased their dividend every year for at least 25 years.

But even being an Aristocrat isn’t enough for your demanding author. I want only stocks with a yield above 3%, so I have some chance of keeping up with inflation.

I call this special group the Dividend Royals.

So which broker should I use to construct this portfolio?

The Contestants

In this corner: Robinhood!

Robinhood is one of the best known brokers today. It took the financial world by storm by offering zero commission trades.

And in this corner: Interactive Brokers!

This stalwart of finance has existed for decades and offers sophisticated tools to active investors.

Who will be the next champion?

Fight!

Robinhood is dead simple. Its intuitive mobile app makes it easy to buy and sell shares of stock, including fractional shares.

And then there’s the feature that made it famous: no transaction fees.

But Interactive Brokers no longer charges fees either in its Lite product. And its Pro offering can get you such great prices on shares that it should be worth the nominal fees if your trades are large.

Robinhood’s simplicity is also its Achilles’ heel. It lacks many of the powerful research and trading tools of Interactive Brokers.

Implementing a Dividend Royals strategy would be manual and painful.

What’s more, if you ever decide you’re sick of Robinhood, it’s expensive to get your money out. Robinhood charges you a usurious $75 fee.

Interactive Brokers charges nothing.

By Unanimous Decision…

Interactive Brokers is a much better choice. Its trading tools are powerful and its fees are even lower than famously cheap Robinhood.

I’m working with Interactive Brokers’ support to find out how to implement the Dividend Royals strategy using their BasketTrader tool. I’ll keep you posted!

There will be no blog on Monday. I’m background acting in an awesome forthcoming show from Netflix!

See you Tuesday. Have an awesome weekend, everyone!

More on markets:

Let’s Make Our Own Index Fund!

Plaintiffs Fight Back in Citadel Lawsuit

Starting a Financial Plan from 0

Photo: “Packerland Pro Wrestling – Roadhouse Rumble” by Ross LaRocco is licensed under CC BY-NC-SA 2.0

If you found this post interesting, please share it on Twitter/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

Plaintiffs Fight Back in Citadel Lawsuit

The small investors suing Citadel Securities LLC are fighting back against its motion to dismiss their case:

Plaintiffs suing Citadel Securities and others over trading restrictions on “meme stocks” have filed a motion to strike the market maker’s recent court filing that leaned on the SEC’s report to dismiss the conspiracy charges.

Describing the notice as “incomplete and misleading,” they challenged Citadel Securities about its efforts to call the court attention to conclusions set out in the SEC’s report on the retail trading mania earlier this year.

Citadel’s reliance on the SEC report to defend itself is problematic. As I wrote here last week, the report barely even covered allegations of collusion between Citadel and Robinhood Markets, Inc. in limiting trading.

The lengthy report devotes just a single paragraph to the allegations. It also takes Citadel LLC CEO Ken Griffin and Robinhood CEO Vlad Tenev at their word.

What’s more, the report has no force of law:

The legal notice further explains that while the 45-page report was simply meant to describe events, the market maker had misinterpreted the regulatory body’s bulletins which, like all staff statements, have no legal force or effect.

Despite the serious allegations against his firm, Griffin still characterizes them as “a bad comedy joke.”

But Citadel could face billions in damages if it loses. Even for someone with Griffin’s wealth, that’s no laughing matter.

More on markets:

Citadel Demands Dismissal of Lawsuit, Citing SEC Report

Starting a Financial Plan from 0

AMC Fails to Deliver Jump 2700%

Photo: “Ken Griffin” by DanGPhotos1 is licensed under CC BY 2.0

If you found this post interesting, please share it on Twitter/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

Let’s Make Our Own Index Fund!

The Problem

Bonds are a big part of many investors’ portfolios. But yields today are close to nonexistent.

Since 2009, rates have been at or below the rate of inflation. Two bond funds I own pay 1.88% and 1.45% respectively.

Inflation is currently running at about 4.8%. This means I’m paying about 2.9-3.4% per year after inflation for the privilege of owning these funds.

Not fun, right?

An Unlikely Solution

So I’ve been exploring building a portfolio of high dividend stocks to replace the bonds and provide income. The stocks I’m interested in have paid high dividends for decades straight.

They represent the highest payors amongst the Dividend Aristocrats. Call them the Dividend Royals.

What if I had my own index fund of these companies? Each stock could be automatically weighted in the portfolio based on its market cap.

So, since Exxon Mobil has a much larger market cap than Federal Realty Investment Trust, for example, it would be a proportionately larger piece of the index fund.

A sophisticated solution could even automatically rebalance the fund on a regular schedule. This would keep the stocks in correct proportion to each other.

But who can provide such a service?

The Hunt

Not many companies, it turns out. Here are the biggest providers of “direct indexing”, or DIY index funds, per Bloomberg:

Vanguard also has such an offering via its recent acquisition of Just Invest.

I’ve requested demos from Vanguard, Parametric (part of Morgan Stanley), and Aperio (part of BlackRock). If I see anything good, I’ll report back!

There’s also an interesting offering from Interactive Brokers called BasketTrader. While I didn’t have the time to dig deep into it today, it looks like it may provide a solid tool for direct indexing.

Do you know a good direct indexing provider? Please leave a comment at the bottom.

There will be no blog on Monday or Tuesday. An old friend is coming to visit!

See you on Wednesday. Have a great weekend everyone!

More on markets:

How Did High Dividend Stocks Perform In the Last Crash?

Should Anyone Own Bonds?

Starting a Financial Plan from 0

Photo: “Thunderbird Supercomputer” by SandiaLabs is licensed under CC BY-NC-ND 2.0

If you found this post interesting, please share it on Twitter/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

AMC Fails to Deliver Jump 2700%

Fails to deliver in shares of AMC Entertainment Holdings, Inc. jumped over 2700% in the latest data from the SEC.

After falling to a low level at the end of September, fails to deliver exploded in October. As of October 14th, the last day in the latest data set, they stood at nearly 80,000.

This amount of fails to deliver is 789 times Amazon’s, 849 times Microsoft’s, and significantly larger even than Apple’s. Why would the largest stocks in the market have far fewer shares failing to deliver than AMC, with a market cap of just $20 billion?

First, let’s recap what a fail to deliver is. A share in a company fails to deliver when a trade is made but never completed. The shares are never actually delivered to the buyer.

This can happen for benign reasons. But AMC has persistent, huge fails to deliver.

When that happens, it’s often a sign of illegal naked short selling. This involves selling short shares you never borrowed.

The shares can’t be delivered because they never existed in the first place. Meanwhile, the seller has a powerful tool to the push the price down.

If you don’t even have to bother borrowing shares, you can keep selling forever.

What you tend to see in AMC stock is the market makers whittling down the fails to deliver for a little while, only to see them quickly pop back up to enormous levels. Following the stock for some time now, I’ve seen this pattern over and over.

We’ve noticed, but when will the SEC?

More on markets:

Citadel Demands Dismissal of Lawsuit, Citing SEC Report

Starting a Financial Plan from 0

Citadel Builds Huge Position in AMC Call Options

Raw SEC data (the fails to deliver are the number right before the company name):

20210930|00165C104|AMC|2815|AMC ENTMT HLDGS INC CL A COM S|35.54

20211014|00165C104|AMC|78931|AMC ENTMT HLDGS INC CL A COM S|37.91

20211013|023135106|AMZN|100|AMAZON COM INC;COM USD0.01|3247.33

20211014|037833100|AAPL|58498|APPLE INC;COM NPV|140.91

20211014|594918104|MSFT|93|MICROSOFT CORP;COM USD0.000012|296.31

If you found this post interesting, please share it on Twitter/Reddit/Facebook/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

Starting a Financial Plan from 0

One of my oldest friends just got his dream job! He’s found fulfillment, accomplishment, and a lot more money.

But what should he do with it?

Matt* wanted to know how he could set himself up for a strong financial future, now that he’s finally making good money. I find a lot of friends and family in their 30’s asking me this question lately.

They come to me because I invest for a living and they want guidance. And I’m honored by that.

So I decided to sketch out a financial gameplan starting from zero, for them and for you.

Soon, you’ll be able to afford jewelry like Mr. T’s! 🙂

Step 1: Save 6 Month Emergency Fund

What if you lose your job or get sick? You don’t want to have to worry about being out on the street or unable to afford food.

And if you’re counting on unemployment, you’re putting yourself at serious risk. That check can take a very long time to come.

So I suggest saving six months of basic expenses in a high yield bank account (this is what I use). Basic expenses include rent or mortgage, utilities, and groceries.

You’ll get a little interest, but the real payoff is in financial security.

Why not just invest this money in the stock market? Because if the market drops by half all of a sudden, as happens from time to time, you won’t have six months of basic expenses anymore. You’ll only have three.

And that may not be enough.

Step 2: Pay Off Debt

It’s heretical to tell people not to pay off their debt first. But the reality is that lenders can often be stalled for a while. Your need to eat can’t.

Yes, your credit card or auto debt could accumulate for a bit while you save up your emergency fund. But it’s better than having an empty bank account if you lose your job.

I suggest keeping expenses down so you can save up that emergency fund and zap your debt ASAP. Once you have an emergency fund and no debt, you can relax a little.

When you’re ready to start paying off debt, choose the highest interest loans first.

If a loan has a lower interest rate than the stock market’s typical 10% return, it may make sense to invest instead of paying that loan off. This is often the case for mortgages.

Step 3: Start Investing

Yay! This is the fun part. This is when you go from just getting by to building wealth.

But investing is so confusing! Tons of companies, countless possibilities.

Here’s where to start: open a Vanguard account and just start buying the Vanguard Total Stock Market Index. On day 1, you’ll own almost 4,000 stocks.

And you’ll only pay 0.04% in management fees per year. On a $3000 account, that’s just $1.20.

Low fees are really important because high management fees can kill your returns.

I’ve used Vanguard for years and the service is outstanding. It forms a core part of my portfolio to this day.

To begin with, you’ll want to max out your 401k and IRA. Afterward, keep investing as much as you can!

It’s ambitious, but I suggest saving half your income if at all possible. It provides a wonderful cushion in tough times and can ultimately free you from working for others.

Step 4: Advanced Investing

You now own several thousand dollars worth of the Vanguard Total Stock Market Index. Congratulations, you capitalist fatcat!

Now, you may want to add other types of investments to your portfolio. Those could include international stocks and real estate, both of which Vanguard offers.

A portfolio with more diversification across parts of the world and asset classes (stocks vs. real estate, for example) tends to perform better over time.

Step 5: Ninja Level Investing

Once you’ve mastered the Vanguard game and built up a considerable balance, you may consider investing in private real estate (I use Fundrise) or tech startups.

These asset classes can provide higher returns, but they have a lot of risk. You often don’t get your money back for years, if ever.

If you’re just starting out, ninja level is a long way off. Crawl and walk before you try to run!

Wrap Up

I like seeing people take control of their lives and their money. That’s why I wrote this post.

If you follow this plan, you can go from an empty bank account and big credit card bills to a growing investment account paying you money.

You just have to take that first step!

Leave your questions in the comment section at the very bottom of the page!

More on money:

FOMO: Investors’ Worst Enemy

Where Can We Hide in a Financial Crisis?

Will Evergrande Spark a Global Financial Crisis?

*Not his real name

Photo: “Me & Mr. T” by roadkillbuddha is licensed under CC BY-NC-SA 2.0

If you found this post interesting, please share it on Twitter/Reddit/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

iHerb

The only place I buy vitamins and supplements. I recently placed an order and received it in less than 48 hours with free shipping! I compared the prices and they were lower than Amazon. I also love how they test a lot of the vitamins so that you know you’re getting what the label says. This isn’t always the case with supplements.

Use this link to save 5%! 

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. 

Where Can We Hide in a Financial Crisis?

Markets are booming today, but just 18 months ago, things looked like this:

Ouch.

I lost about 22% of my portfolio in less than five weeks. It certainly made life interesting.

Today, markets sit near all time highs and jobs go begging. It’s a far cry from the darkest days of the COVID disaster.

But the next financial crisis is coming. It could be in a month, a year, or ten years. But as investors, we need to be prepared.

One of the best ways to protect ourselves is to own assets that are not correlated with stocks. That way, when the market is falling off a cliff, a part of our portfolio is preserved.

People often look to overseas stocks or real estate to diversify. I own those myself. But although they can deliver nice returns, they are highly correlated with US stocks.

Global stocks have a 0.97 correlation with the S&P 500, a near perfect match. Even Real Estate Investment Trusts (REITs) show a very strong correlation (0.70).

Investment grade bonds (-0.06) and cash (-0.17) show low correlations with stocks. But the yield to maturity on that Bloomberg investment grade bond index is just 1.42%, way below inflation. And cash in a bank account returns about enough to buy a candy bar at the end of the year.

So where do we go? Here are some options:

Litigation Finance

This arcane corner of the financial world gives plaintiffs and lawyers money to sue people. The lawsuits usually involve a small company suing a larger one.

Returns can be eye popping. But it’s difficult for those of us who aren’t lawyers to understand what we’re investing in. Are these good cases likely to win? Or suckers’ bets?

It probably only makes sense as a small portion of a portfolio, at most. And minimum investments can be high, making it less attractive to many.

Farmland

Ya gotta eat, right?

New platforms have sprung up to help people invest directly in farmland. Returns can exceed those of stocks, and correlation with US stocks is almost nonexistent (-0.05).

This could be an attractive area, but it’s quite unfamiliar to me, and probably to most other investors. I’d have to research it a lot more before jumping in.

Dividend Aristocrats

Dividend Aristocrats are blue chip stocks that have increased their dividends every year for at least 25 years. They’re household names like Coca-Cola, Exxon, and IBM.

They generally have higher returns than the S&P 500 with lower volatility. That’s a win-win.

But they’re highly correlated with the rest of the index (0.9). That said, they’re still better than overseas stocks in this respect, and not dissimilar to real estate.

Wrap Up

We have some interesting options for keeping our portfolios safer in the next bear market while preserving yields today. I encourage you to dig deeper into your favorite categories.

What asset classes do you favor in a crisis? Let me know in the comments at the very bottom.

More on markets:

Will Evergrande Spark a Global Financial Crisis?

Should Anyone Own Bonds?

How Solana Could Wipe Out Visa and MasterCard

Photo: “Tomb of Lehman Brothers” by futureatlas.com is licensed under CC BY 2.0

If you found this post interesting, please share it on Twitter/Reddit/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

iHerb

The only place I buy vitamins and supplements. I recently placed an order and received it in less than 48 hours with free shipping! I compared the prices and they were lower than Amazon. I also love how they test a lot of the vitamins so that you know you’re getting what the label says. This isn’t always the case with supplements.

Use this link to save 5%! 

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order.

AMC Shares 50% More Likely to be Traded in Dark Pools

The huge proportion of shares in AMC Entertainment Holdings, Inc. trading in dark pools has raised suspicions among retail investors. So today, I decided to find out if AMC is really more likely to be traded in dark pools.

What I found surprised me.

First, a little explanation. A dark pool is a privately operated stock exchange. It does not report prices publicly like the NYSE or Nasdaq.

In fact, there is little transparency of any sort. Most are operated by large investment banks like Goldman Sachs and Morgan Stanley.

60% of AMC shares in the last 30 days have been traded in these dark pools. In general, 40% of the market by value is traded there.

So AMC shares are 50% more likely to be traded in this opaque, secretive type of exchange.

What’s more, shares in tiny “microcap” stocks are the most likely to trade on dark pools. But AMC has a market cap of $21 billion, making it a large cap stock.

If you look at the two stocks most similar in size to AMC, VICI Properties, Inc. and Netapp, Inc., you see much lower figures. 30% and 26% of their shares trade in dark pools respectively, less than half that of AMC.

And if you look at one of the most commonly traded shares in the market, the S&P 500 ETF Trust, it too is traded in dark pools only half as often as AMC.

Let’s review: a massive proportion of shares are traded in dark pools. Add that to a long term pattern of huge fails to deliver suggestive of illegal naked short sales (see this, this, and this).

Trading in AMC shares looks increasingly fishy.

How much more evidence does the SEC need before they investigate?

More on markets:

AMC Has Burned Short Sellers for $4 Billion in 2021, Per Latest Data

Will Evergrande Spark a Global Financial Crisis?

New Data: AMC Fails to Deliver Down 85%

Photo: “Bruce Springsteen” by afevrier is licensed under CC BY-NC-SA 2.0

If you found this post interesting, please share it on Twitter/Reddit/etc. using the buttons at the bottom of the page. This helps more people find the blog! 

Save Money on Stuff I Use:

Amazon Business American Express Card

You already shop on Amazon. Why not save $100?

If you’re approved for this card, you get a $100 Amazon gift card. You also get up to 5% back on Amazon and Whole Foods purchases, 2% on restaurants/gas stations/cell phone bills, and 1% everywhere else.

Best of all: No fee!

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account.

iHerb

The only place I buy vitamins and supplements. I recently placed an order and received it in less than 48 hours with free shipping! I compared the prices and they were lower than Amazon. I also love how they test a lot of the vitamins so that you know you’re getting what the label says. This isn’t always the case with supplements.

Use this link to save 5%! 

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order.