Marijuana ETFs Aren't Too 'High' Just Yet

With Canada set to legalize the recreational use of marijuana on October 17th, marijuana-related stocks and thus marijuana ETFs built around these equities have been on the rise. Many investors believe the marijuana industry will the next big growth industry since the drug has never been legal, but known to be rather popular with those looking to relax. Not only have individual investors been looking to the industry as a way to grow their wealth, but the alcohol industry has recently shown serious interest in the industry.

In August we saw Constellation Brands (STZ) increase its stake in Canopy Growth (CGC), we saw Molson Coors (TAP) partner up with Hydropothecary Corp. (HEXO) and there were reports that Tilray (TLRY) was in talks with Diageo (DEO). The rumors that Diageo and recently IPO’d Tilray where in talks has helped TLRY jump more than 100% since going public in mid-July of this year. While the moves from TLRY, HEXO, and CGC have all been astonishing in the past few months, the fact remains that the industry as a whole can still go higher in the future.

When marijuana became legal in Colorado and then California, the industry experienced a significant increase in demand literally overnight. That demand is once again going to jump on October 17th when Canada becomes legal. Furthermore, with the trend appearing to be taking hold not only around the country but the world, it's not hard to see how within maybe the next five to ten years from now, some of the marijuana stocks will be as big as the top alcohol companies.

But, that is where the problem rests. Trying to determine today, which companies are going to dominate the marijuana market in the coming years is not only a daunting task but perhaps more like gambling than investing.

Luckily though, we have a few ETFs that you can pick from today. Continue reading "Marijuana ETFs Aren't Too 'High' Just Yet"

Maybe FAANG Isn't For You, But BAT May Be

Long before the trade war started, investors have been arguing over whether it’s better to invest in an established market like the US or growing, larger population market like China. This debate has stretched for years, well before the terms FAANG (Facebook (FB), Apple (AAPL), Amazon.com (AMZN),Netflix (NFLX), and Alphabet (GOOG)(GOOGL)) or BAT (Baidu (BIDU), Alibaba (BABA), and Tencent (TCEHY)) were coined.

But now, as the trade war between China and the US continues to heat up, investors have been battling over another China Vs. US technology investments. Perhaps because these stocks have been monster winners and some believe that since these companies are mainly technology stocks, they will be exempt from the pain that could come from the trade war. However, while it is unknown how much the trade war will affect these big technology companies, it should be noted that if each country’s economy suffers from the new tariffs, that the FAANG and BAT stocks could feel some adverse effects.

But in the meantime, if you are still interested in finding some Exchange Traded Funds which will give you exposure to FAANG and BAT stocks, you are in luck. I recently highlighted a few FAANG related ETFs which you can read about here, or continue below for some BAT related ETFs. Continue reading "Maybe FAANG Isn't For You, But BAT May Be"

A Few Bond ETFs That Have Performed Well, Despite Rising Interest Rates

Investors who buy bonds or bond funds are doing so because they want to reduce their risk and preserve their capital. Bonds work very well at doing this when the stock market or economy is declining, but not when economic conditions are strong.

Currently, the US economy is strong with 4% GDP growth, the S&P 500 coming close to setting a new all-time high, the unemployment rate at the lowest level its been in years. All of these indicators point towards the opposite of what bond investors want, especially the need for higher interest rates as inflation continues to creep higher.

Recently JP Morgan Chase’s CEO, Jamie Dimon, said he thought the 10-year Treasury yield should be at 4%, not where it currently sits at the below 3%. He went further and said that 5% interest rates are coming and that investors need to start preparing. Some have argued that interest rates should already be in the 4% to 5% range.

If, Dimon and others are correct in their prediction that higher interest rates are coming than current bond holdings need to “Get out of Dodge” before they get burnt. We have already seen bond funds take a hit in 2018, but if rates do climb as high as 5%, the losses we have seen thus far may dwarf what is to come.

Not surprisingly the best Bond Exchange Traded Funds over the past year are the 3X leveraged short funds. Continue reading "A Few Bond ETFs That Have Performed Well, Despite Rising Interest Rates"

Shark Tank's "Kevin O'Leary" Has A New Fund

Kevin O’Leary is best known for his antics on Shark Tank, but to those on Wall Street, he is known for his more conservative approach to investing. O’Leary started his O’Shares ETF Investment firm back in 2015 and launched the firm's first fund the O’Shares FTSE U.S. Quality Dividend ETF (OUSA). A month after releasing that fund he rolled out two more, the O’Shares FTSE Europe Quality Dividend ETF (OEUR) and the O’Shares FTSE Asia Pacific Quality Dividend ETF (OASI).

His next two ETF’s came in 2016 and 2017 and if perhaps you could guess what phrase was in the name of both of those? Quality Dividend!

The O’Shares FTSE Russell Small Cap Quality Dividend ETF (OUSM) starting trading December 30th, 2016 while the O’Shares FTSE Russell International Quality Dividend ETF (ONTL) began trading on March 22nd, 2017.

The first five funds O’Leary has rolled out focused on companies with strong balance sheets, and that paid a nice dividend, what most investors would refer to as “conservative” investments. But, his newest ETF, the O’Shares Global Internet Giants ETF (OGIG), is a lot less about quality dividends and more about quality business and growth potential. So, O’Leary is still looking for quality businesses, but with more growth opportunity than dividend income like his past ETF’s. Continue reading "Shark Tank's "Kevin O'Leary" Has A New Fund"

Now May Be The Time To Buy A FANG ETF

The phrase the FANG stocks, which was coined by CNBC’s Jim Cramer, represents five high flying technology stocks, Facebook (FB), Amazon.com (AMZN),Netflix (NFLX), and Google’s parent company Alphabet (GOOG - GOOGL). Cramer coined the phrase because how incredible these stocks where performing when compared to other technology stocks, or the market as a whole. These stocks have been market leaders for a few years, during which time we have seen their valuations go through the roof. But, the old saying on Wall Street, “stick with what’s working” has simply continued to work with the FAANG stocks. Until recently.

Facebook, Amazon.com, Netflix, and Google’s parent company Alphabet have all now reported quarterly earnings for the second quarter and while Amazon, Google, and Netflix didn’t get destroyed like Facebook, the group combined with Apple (AAPL), had lost $185 billion in market value during the last few days of trading in July. This decline had some investors wondering if the FANG rally is over, while others are considering this a good buying opportunity.

I personally am in the latter camp considering Gross Domestic Product figures came in at 4.1%, the recent job reports have all been strong, and despite some issues, mainly caused by those in Washington, all economic data indicates that the US consumer and economy is strong.

Furthermore, a strong case can be made that Facebook hurt itself regarding growth due to changes it is implementing following the data scandal back in the spring. The stock fell 19% in one day after reporting earnings. For the most part, the rest of the FANG stocks reported good quarterly earnings from most points of view, despite perhaps not topping lofty expectations set by Wall Street analysts. Continue reading "Now May Be The Time To Buy A FANG ETF"