🍨 Daily Scoop: Sitting on Our Hands
By Tue, Oct 8, 2019
Hi Scoopers,
Another week and another round of trade worries; that’s why most Chinese stocks fell a few percentages on Monday. We, on the other hand, decided to sit still, and do nothing.
Other than that, did you know that to invest in the cannabis sector, you don’t have to pick cannabis stocks? Ha? We’ve got your attention, right? Before you scroll down to read about that, one more quick thing to say. Two parents are suing Fornite for its cocaine-like addictive qualities. If you or your kids can’t put down the phone all night, it’s not your fault. You are addicted to some cocaine-like substance called fun.
More information is available in the “Overall Market,” “What’s Up?” and “What’s Down?” sections. Scroll down to read.
MARKETS
- U.S. markets: All three major indices changed their direction away from Friday’s green zone and wrapped Monday lower than where they started. Scroll to the Overall Market section to learn more.
- Cryptocurrency: While we were chilling in the backyard during the weekend, Bitcoin traders had a big scare. Bitcoin’s price fell as low as ~$7,799.26 per coin before rebounding to above the $8,000 mark.
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OVERALL MARKET
Sitting on our hands in response to the market’s ups and downs.
What happened on Monday?
All three indices fell less than 0.5% on Monday, with the S&P 500 taking the biggest hit, closing the day almost 0.5% lower than where it started. The U.S.-China trade negotiations have resumed this week. And, with it, came another wave of worries by the American businesses about the future.
What does this mean?
A new survey by the National Association for Business Economics (NABE) came out on Friday. The participants of the survey shared their concerns about the future growth outlook in the shadow of the prolonged trade negotiations.
The survey by NABE has a small sample size of 54 professional forecasters. Opinions, especially coming from only 54 people, should rarely be considered as the foundation of an economic forecast. However, as we know, in a market that the majority of the trades are done by algorithms, and the algorithms are set to be sensitive to the news and the sentiment of the market, we can’t expect too much sanity.
If you are a long-term investor who focuses on investing in well-managed companies based on the merits of their operations and not the sentiment of the market, these ups and downs are barely any reason to adjust your portfolio. That’s what we are doing, sitting on our hands and doing nothing.
WHAT’S UP
Invest in the cannabis sector without investing in cannabis stocks.
So, what happened?
Shares of EnWave (Ticker: NWVCF) were up almost 14% on Monday after the company announced solid quarterly earnings. What does EnWave have to do with the cannabis sector, though? Glad you’ve asked?
The Cannabis plant must get dried properly and efficiently before use. The more widespread the application of cannabis becomes, the more accurate and efficient the production process has to become. The drying process has to be energy-efficient and maintain the flavor and the quality of the product. That’s were EnWave comes in. It has a patented and innovative technology for the precise dehydration of organic materials. The company has a widespread licensing agreement and partnership for the use of its technology with one of the industry’s largest players, Aurora (Ticker: ACB), and allows you to invest in the cannabis industry without investing in cannabis stocks.
WHAT’S DOWN
Another bad day for Chinese stocks.
So, what happened?
As long as the trade war negotiation progresses as slow as it has been, the U.S.-listed Chinese stocks (known as ADRs) do not get much optimism. Shares of several Chinese stocks, including the tech giant Baidu (Ticker: BIDU) fell on Monday. Baidu was one of the bigger losers and fell almost 3%.
WATER COOLER
Kids are addicted to …
So, what happened?
Fortnite is the new topic of an anti-addiction lawsuit. Legal firm Calex Légal represents the parents of a 10-year-old and 15-year-old who claim that Fortnight is as addictive as cocaine. The parents of these young kids are suing Epic Games, the developer of the popular social game, with a quarter of a billion players. These parents claim Fortnight has worked with psychologists and mathematicians to intentionally create an addictive game that is no different from distributing cocaine to kids.
It seems to us that someone is blaming the neighbors for raising addict kids…
Don’t get us wrong, we know video game companies use psychological techniques to make their products more engaging. However, nothing can replace good old discipline and good parenting. What’s your take on this topic?
About the Author
The authors of this Scoop are the editorial team at Stock Card, led by Hoda Mehr. Hoda Mehr is CEO and Co-founder of Stock Card and the host of Renegade Investors podcast. She runs a community of 40,000 stock market investors and manages Stock Card's successful flagship portfolio, Roll with Our CEO, on Stock Card Portfolio Store. Hoda is an Economist with an MBA from Concordia, John Molson School of Business. She applies behavioral economics, data journalism, and storytelling to all aspects of her work. Before starting Stock Card, Hoda worked as a strategy and insights lead at technology companies including Symantec, Aimia and Sony. Create a free account to do your stock market research easily and mistake-free: Stock Card Stock Card
