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Your investing playbook depends on who wins

Nov 08, 2022

Good morning!

Americans go to the polls today for what is widely expected to be a political reset. And the market, of course, is betting on that narrative.

Here’s the thing.

I learned a long time ago that it’s always prudent to look at the other side of the trade whenever the “everybody” knows something to be true.

Here’s my playbook.

Why I won’t touch housing stocks

The numbers are downright nasty. The price-to-income ratio (meaning the price of houses to income) is at or near all-time highs, deals are getting cancelled left, right, and center, 75% of Americans are looking for a side gig… and inflation rages.

My take with the fantastic Maria Bartiromo earlier this morning and observations from my colleague, the venerable Dennis Gartman. (Watch)

Gilead hits new 52-week highs yesterday

The need to own the world’s best stocks has never been greater. Gilead Sciences certainly fits that mold. The company has tacked on some healthy gains for three days in a row. And, just yesterday, hit new 52-week highs. This after smashing earnings last week.

Is GILD a buy or sell? Upgrade to paid.

Your investing playbook depends on who wins

If the right sweeps, then expect defense, healthcare, big tech, and energy to pop.

If the left maintains power, then it’s gonna be pot stocks, handouts, and bailouts, including all things EV.

Spoiler alert: Energy and defense may well run anyway for the simple reason there’s a bigger story at work. Several actually!

Hopefully you’ve got a few of both in your portfolio. One of my favorites has charged 57.3% higher over the past 12 months while the S&P 500 has dropped 19.8% over the same time frame.

That’s a 77% performance advantage for anybody following along, btw. And something One Bar Ahead® readers know all about. Join ’em if you’d like.

I hope I’m smart enough to add more!

Carvana investors to JPM: thanks for nothing

The rocket scientists are apparently at it again over at JPMorgan, where analysts cut their price target for Carvana, saying that the used-vehicle retailer is “far from out of the woods.”

Ya think?

The stock has already fallen 97.6%.

Keith’s Corner: Always do what Wall Street does, not what it says. The pros started selling a year ago and have never let up. A Morgan Stanley analyst, incidentally, had a price target of $420 per share as recently as February. On November 4, he threw in the towel and is now calling for $1 a share.

Now we know why beer sales haven’t gone flat 🤦‍♂️

Chemicals that give IPAs their distinct flavor may also prevent protein clumping in our brains. And, get this, researchers also determined that hop extracts triggered autophagic pathways, a renewal process wherein our bodies break down then reuse old cell parts to boost efficiency.

Italian researchers are quick to caution that the threat of Alzheimer’s might not justify drinking more beer, though. Boozing it up accelerates brain shrinkage which, in turn, leads to cognitive issues. (Read)

Bottom Line

Bottom Line

Trying to force a setup in an environment when having the edge comes from owning great names is simply foolish.

As always, let’s MAKE it a great day.

You got this!


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