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Brexit: Secession Bells Are Ringing!

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First Baptist Church in Columbia, S.C., where the first secession convention in the United States opened on Dec. 17, 1860. Source: Library of Congress, Washington, DC. Photo. Encyclopædia Britannica Online. Web. 24 Jun. 2016. Global markets are plunging, and the implosion may still be in the early innings. Market valuations remain stretched among stagnant global economic growth, and “Brexit” may be the catalyst for a correction. In the paraphrased words of the well-known The Day of the Jackal author, Frederick Forsyth: the peasants have spoken. On June 23, the UK (EWU) held a referendum, in which anyone of voting age could take part, to decide whether the country should leave the European Union. The turnout was incredible at nearly 72%, and … Read more

Altria and “Socially Confused” Investing

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You may have heard of socially-responsible investing. This investment framework tends to avoid businesses that are involved in tobacco, alcohol, sugary sodas, gambling, fossil fuel production, or even defense. There’s nothing wrong with having views about these topics – in fact, that’s what being an individual is all about. However, things get kind of silly when such views dictate how one makes money in the secondary market, or how asset managers invest in portfolios. You see – when you buy or sell stock, the company that you are investing in doesn’t get that money. You are merely trading with someone else. The company only receives your money when you invest in the primary market (IPO) or through new shares, a … Read more

Your Hard-Earned Money

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By Brian Nelson, CFA It was Thursday afternoon, February 11, crude oil prices just hit a 13-year low, and the S&P 500 (SPY) was about to break below key technical support. Then, just as the markets were to fall further, rumors again emerged that OPEC may be scheduling a meeting to curb crude oil output, driving crude oil prices from the depths and the market higher off technical support. A barrel of crude oil continues to trade below the $30 mark, but it was quite the “save.” From where we stand, the market hasn’t been this fragile than at any time during the past decade or so, including during much of the Financial Crisis. Optimists may be whistling past the … Read more

Market’s Swooning: Bye Bye Energy MLPs, Part II

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Things were ugly again during the trading session February 8, but you were expecting the weakness. There’s nothing surprising, and we continue to wait to scoop up undervalued gems once the tide of this market turns. Topping the news today was the abrupt replacement of the CFO of Energy Transfer Equity (ETE)/Energy Transfer Partners (ETP) coupled with the sell-off in Chesapeake Energy (CHK) on news of a probable bankruptcy, which set the tone among midstream MLPs (AMLP), the index diving aggressively. Followers of Valuentum were far ahead of these developments, “Focus on ETE, Not ETP, Strive for Balance and Stick to the SEC Filings,””Alert: Energy Transfer Equity Is More than 7x Leveraged!,” “Energy MLPs Continue Swoon,” and our body of … Read more

Google…Ahem…Alphabet!

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“A falling stock price doesn’t mean the stock is cheaper; it doesn’t mean that the stock will go back up; and it certainly doesn’t mean that the stock can’t fall further. In some cases, a falling stock can become more expensive as it drops, if its value falls by a greater amount.” – Brian Nelson, CFA The company formerly known as Google, Alphabet (GOOG, GOOGL), is surging in after-hours trading February 1. As a result of Google’s stock split in 2014, we include both share classes (non-voting Class C, GOOG, and Class A, GOOGL) in the Best Ideas Newsletter portfolio, collectively one of its largest holdings (5%+). Alphabet, then known as Google, first registered a 10 on the Valuentum Buying … Read more

Dividend Growth ‘Bubble’ To Continue But For How Long?

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You’ve heard about low interest rates. You may have even heard about a ZIRP, zero interest-rate policy, as had been the case in the US for years, but have you heard of NIRP, negative interest-rate policy? Well, that’s the latest with respect to Japan (EWJ), which is home to the third-largest national economy in the world after the US and China. On January 29, the Bank of Japan (BOJ) introduced a negative benchmark interest rate of -0.1%, meaning that instead of paying interest on deposits, it will charge commercial banks to hold their money. This may make Japanese exports cheaper to stimulate growth, but my goodness, talk about a move to push “parked” assets out of the country. The US … Read more

The Bounce in Energy and Potash’s “Surprising” Dividend Cut

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Nothing like Valuentum’s optimistic article last week, January 21, in Barron’s to get the energy markets popping, “Is Kinder Morgan on Road to Recovery,” would you say? Of course, we say that in jest. The equity markets January 28 were defined by optimism that two of the globe’s major energy resource producers, the cartel OPEC and Russia (RSX), would finally come together to alleviate the pain that has been exerted on the price of the black liquid the past 12-24 months with a “meeting.” What we found to be peculiar, however, is that instead of OPEC letting what turned into a “rumor” run, helping to further drive crude oil prices higher, OPEC delegates quickly denied the talk of a potential … Read more

Excited About Putting Cash to Work…Eventually

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Investors are fretting over a lot of things as of late. China (FXI) announced January 19 that fourth-quarter GDP fell to 6.8%, with many noting that the measure was a 25-year low. Even if you believe that number, which may be a stretch in light of collapsing local stock markets in Shanghai and Shenzhen, the outlook can’t be much better. Steel mills across the country are reeling, and while published housing numbers don’t look that bad, we have a difficult time believing the Chinese banks are in good shape. HSBC (HSBC), Standard Chartered, and Citigroup (C) remain most exposed to what we would describe to be the growing likelihood of a contagion from weakening commodity-dependent sectors in the country. Intel … Read more

Analysis: The Best Ideas Portfolio

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Please select the image below to download the report.  Note: The High Yield Dividend Newsletter portfolio, Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio are not real money portfolios. Results, including those in the Nelson Exclusive publication, are hypothetical and do not represent actual trading. Past performance is not a guarantee of future results, and actual results may differ from simulated information being presented.  The performance of the High Yield Dividend Newsletter portfolio, Nelson Exclusive publication, Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio have not been externally audited. The following download of the Best Ideas Newsletter portfolio is an internal assessment. Newsletter performance figures, including those in the Nelson Exclusive publication, are prepared by Valuentum. Hypothetical results are … Read more

Leading Investors to Water…

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“Entrepreneurs are never satisfied. They want to do things better. They strive for perfection and use all the ingenuity to their command to achieve it.” – J.W. Marriott Company Name Symbol YTD % Outperform? Apple AAPL 7.84 Y Alibaba BABA -18.37 N Altria MO 18.75 Y Cisco CSCO -1.2 N eBay EBAY 24.26 Y Financial Select SPDR XLF 1.52 N General Electric GE 20.66 Y Gilead Sciences GILD 10.41 Y Google (now Alphabet) GOOG 46.07 Y Google (now Alphabet) GOOGL 46.84 Y Health Care ETF XLV 6.02 Y Intel INTC -3.73 N SPDR S&P Bank ETF KBE 9.25 Y Republic Services RSG 10.09 Y Rio Tinto RIO -31.07 N Teva Pharma TEVA 16.12 Y Union Pacific UNP -32.46 N Utilities … Read more