Pro Perspectives 10/23/22

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October 23, 2022
Special note on stock market declines
During market declines – with the constant barrage of market analysis and opinion on financial television, in newspapers, or through the Internet – it’s easy to get sucked into drama played out in the media.

That tends to drive fear. 

But while the fearful start running out of the store when stocks go on sale, the best investors in the world, start running IN.

The fact is, the best investors in the world see declines in the U.S. stock market as an exciting opportunity.  And so should you.

Most average investors in stocks are NOT leveraged. And with that, they should see U.S. stock market declines as a gift.  The question should be: 'Do I have cash I can put to work at these cheaper prices? And, where should I put that cash to work?'

Billionaire Ray Dalio, the founder of the biggest hedge fund in the world, has said what I think is the most simple yet important fact ever said about investing.

'There are few sure things in investing … that betas rise over time relative to cash is one of them.'  
In plain English, he’s saying that major asset classes, over time, will rise (stocks, bonds, real estate). The value of these core assets will grow faster than the value of cash.
That comes with one simple assumption. The world, over time, will improve, will grow and will be a better and more efficient place to live than it was before. If that assumption turned out to be wrong, we have a lot more to worry about than the value of our stock portfolio.

With that said, as an average investor that is not leveraged, dips in stocks (particularly U.S. stocks – the largest economy in the world, with the deepest financial markets) should be bought, because in the simplest terms, over time, the broad stock market has an upward sloping trajectory.

You don't have to pick the bottom.  Just take advantage of discounts when you see them. 
This is the very simple philosophy Dalio follows, and is the core of how he makes money, and how he has become one of the best and wealthiest investors alive.
Billionaires Bill Ackman and Carl Icahn, two of the great activist investors, lick their chops when broad markets sell off on fear and uncertainty.
Ackman says he gets to buy stakes in high quality businesses at a discount when broad markets decline for non-fundamental reasons.
Icahn says he hopes a stock he owns goes lower so he can buy more.
What about the great Warren Buffett?  What does he think about market declines? 


He has famously attributed his long-term investing success to 'being greedy when others are fearful.'
With this rationale in mind, I've just published an update on two stocks in our Billionaire's Portfolio
One is the highest conviction stock in the portfolio of one of the great activist investors of the past twenty years.  He has a third of his multi-billion portfolio in this one stock.  It's a vital company in the multi-trillion dollar clean energy agenda.  Wall Street just upgraded the stock, calling for 50% upside over the next twelve months. 

The other update was on a technology company that owns the infrastructure critical to the success of 5G.  If 5G is the future, it won't happen without this company. It's the second largest position in the portfolio of a billionaire value/activist investor with a nearly 50-year track record.  Wall Street has a high price target on it 80% above current levels.
Add to this, we've recently added a new stock to our portfolio.  It's the highest conviction position in the portfolio of one of the best biotech investors in the world.
Also involved in the stock is the best activist investor in the world.  Both are very influential billionaire investors, with large stakes in the company, and are already pushing company leadership to unlock value in the stock.  Wall Street has a high 12-month price target on the stock more than 60% higher than current levels
If you're interested in these stocks, click here to join us, and I'll send you all of the details … plus you'll get access to our full portfolio of similar big-opportunity stocks, all owned by some of the most influential investors in the world.
If you're already a member, you can of course find all of the details in the member's area, here.