Comments by "Wandering Existence" (@WanderingExistence) on "New Money" channel.

You mean concentration into super high qualities companies that keep growing rapidly? Sounds more like an opportunity than a risk. The United States has a strong tendency to have its upwards stock market volatility far surpass its downside volatility.
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America isn't in a bubble, we have some of the highest quality companies growing at some of the highest rates. You can't uniformly compare the current markets to past markets because there's a completely different sector composition. Buffett investment style was to buy companies below a fair market value and sell them for at or just above his believed fair value. This is completely different to growth investing which is dependent on the company being able to compound fcf at a high rate. Most of the companies that dominate the US indexes are high growth tech companies and this is a very logical reason as to why valuations are higher then other parts of the world. The US sector exposure is just more shifted towards technology and growth. This is largely due to the fact that we have tax and regulatory laws that are favorable to corporate interests, along with a deep culture dedicated to ideas of capitalism... Oh, and we also let corporate lobbyists bribe our politicians.
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@BMS866 I would venture to say it's both the increased demand in equities and well as the quality of the equities in this area. I'm young-ish, so maybe I just don't know, but I'm skeptical that back in the day they were compounding fcf at the same rate as Mag7's.
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It's a good way to get a variety of ideas but I wouldn't rely on it. It's overpriced, very hard to cancel, and has terrible customer service.
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@kurniawanms2 Next year? Nah, 5T maybe, but there is no way earnings and multiples are expanding that much. But most likely 10T before 2030.
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@timmitoz1380 I get the law of large numbers thing, but big companies can also create whole new markets that have high returns, but have the barrier to entry of high capital expenditures. And let's just be honest from an investor standpoint, doesn't it feel a little bit better to own a high growth form with a big name that most people have news coverage on rather than something obscure that has more information asymmetries than could jackpot with large gains or just hide big risks. Nasdaq100 has lots of high quality companies and high quality firms trades at a premium. Have you looked at Nvidia's guidance? 80% yoy growth this quarter and 67 next quarter, yes, it's slowing, but it's still massive for a company with 50B+ in net income. ForwardPE of 34 due to large earnings growth projections, which yes, is nearly half of the current 62, so net income is expected to nearly double in 4 quaters. New chips have pent up demand as hyperscalers look to make 100k-300k chip clusters. Then there's robotics and FSD cars. Nvidia is opening up 100s of billions in new TAM. That's something a small cap can't do. As for a Bitcoin, it produces no cash flows (the network can supply miners with revenue but that's dependent on people holding and wanting the underlying asset that has no cash flow). Its price has largely been a reflection of currency inflation and political instability pit against its limited supply, which is why there's the overused euphemism is that it's "digital gold".
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@timmitoz1380 1/2 Totally get the law of large numbers and all, but big companies can also create whole new markets that have high returns, but have the barrier to entry of high capital expenditures. And let's just be honest from an investor standpoint, doesn't it feel a little bit better to own a high growth form with a big name that most people have news coverage on rather than something obscure that has more information asymmetries than could jackpot with large gains or just hide big risks. Nasdaq100 has lots of high quality companies and high quality firms trades at a premium.
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@timmitoz1380 2/2 Have you looked at Nvidia's guidance? 80%yoy growth this next quarter. ForwardPE of 34 due to large earnings growth projections, which yes, is nearly half of the current 62, so net income is expected to nearly double in 4 quaters. New chips have pent up demand as hyperscalers look to make 100k-300k chip clusters. Then there's robotics and FSD cars. Nvidia is opening up 100s of billions in new TAM. That's something a small cap can't do. As for a Bitcoin, it produces no cash flows (the network can supply miners with revenue but that's dependent on people holding and wanting the underlying asset that has no cash flow). Its price has largely been a reflection of currency inflation and political instability pit against its limited supply, which is why there's the overused euphemism is that it's "digital gold".
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@timmitoz1380 I keep replying but they keep vanishing... 🫤
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@timmitoz1380 I would like to respond to you but they keep disappearing...
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What's your time horizon? What's the quality of the companies you own? Money that you need in less than 3 to 5 years shouldn't be in stocks, as it won't have time to recover if the price drops in the short term. Higher quality companies will be able to weather downturns a lot better- I personally like VIG, the vanguard dividend appreciation ETF, because it acts as a screening process for picking companies that are healthy enough they can raise dividends even in rough waters.
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@mikkelhansen3714 This month old comment is month old milk. 99%yoy rev growth and 126%yoy profit margin growth. It's been a great year for them... But you think they should still trade sideways??
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@CyChong-vm2uf Yes, for indexes it means just that. That means at 7.5% Nvidia will have 75M of buying pressure for every 1B the SPY inflows. Fun fact: Even though there are 500 companies that are on the SP500, there are 503 stocks due to the fact Alphabet, Fox Corp, and News Corp, have two share classes listed.
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@NewMoneyYouTube I agree they might be on the higher side, but the point I was trying to make is that people want high-quality financial assets. There is a premium to be had for companies with good management, strong market share, wide moats, large margins, and continual high-paced growth. Mag7 is very strong. The biggest threat to them was Lena Kahn of the FCE, because a lot of them are very monopolistic in their rent-seeking practices, but with the next administration the FEC won't be as much of an issue. Now with that swept under the rug, the new problem is tariffs. Apple already has shown that last quarter they had some growth problems with the iPhone (that could just be cyclical or it could be a signal of saturation), and that will be a hurdle that will be harder to clear as Chinese manufacturing gets taxed. I do see some potential issues with the chip sector as Taiwan becomes less safe guarded. As a Nasdaq100 bull those my bearish views.
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While a primary residence with no renters is not an income generating asset, it could potentially grow in capital value either through renovation or increases in land value. Much like how many companies don't pay dividends, but focus on capital growth.
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@AndreKia-c2m ok, bot
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It would seem to be context dependent. The largest liabilities of home buying are the mortgage, maintenance, and property taxes. Asset generates income/ capital growth, while a liability is an expense/ loss of capital value. A homeowner can make regular income by renting out rooms. They can also increase their capital value by renovating and/or having the property located in an up-and-coming area that is seeing land values raise. If income/ increase in value can eclipse the costs, then it's a wealth generating asset. One house might be a liability and another an asset. Similarly, cars for most people's are usually a liability that earn no income and depreciates, but an Uber driver might see it as an asset for making income, or a car collector might buy a car because it's rare and will appreciate in value (they might also rent it for photo shoots).
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