Week End Thoughts

So, I did add to Cloudflare and Stitch Fix this week. I am very confident in their businesses. September is coming to an end, indexes (SPX, QQQ, DJIA) are off the highs, I see retailer "investors" freaking out for some odd reason as if markets are not suppose to go down, welcome to reality. I am sanguine on where we are at in the markets, historically September and October are relatively boring/volatile months. Yeah, the election is coming up, you can probably expect some volatility as the candidates battle it out with false promises.

I do not care for politics anymore, politicians are gangsters without guns (pretty sure this is a quote from Narcos), I care about making money. Republicans and Democrats are going to be duking it out on a new stimulus bill, obviously fuel for the markets if we get something, but they always make it political and not about the people. https://www.cnbc.com/2020/09/24/coronavirus-stimulus-democrats-prepare-new-relief-bill.html. $2.4 trillion stimulus plan, I do not want to sound mean or condescending, but if you did not become wealthier this year what were you doing? The Federal Reserve essentially said "here you go, buy risk assets". Sure, there is probably a disconnect between valuation and the underlying economy, but things will eventually get back to normal, and I am not buying stocks based on 3, 6 months, even a year. The businesses of my companies are doing quite well!

Durable Goods https://www.wsj.com/articles/u-s-durable-goods-orders-rise-for-fourth-straight-month-11601038909 orders rose for the fourth straight month, good right? Manufacturing is coming back, right? Should we look for investment opportunities there? I am staying away from now, I like my higher margin businesses (NET, DKNG), even SFIX is between 44-46% Gross Margins.

U.S Home Sales https://www.wsj.com/articles/u-s-existing-home-sales-continued-to-climb-in-august-11600784199 have been having a strong rebound, it makes sense, my Fiancé and myself are looking to buy a house next year and every house our real estate agent sends us sells in less than 48 hours! It is incredible.

U.S Household Net Worth Hits Highest Level Ever https://www.wsj.com/articles/u-s-household-net-worth-hits-highest-level-ever-11600705010, ah ha! I can say this is true for myself, the perks of having over 80% of your net worth invested in the equity markets.

I want to reiterate how well I thought Stitch Fix quarter was. https://www.fool.com/investing/2020/09/24/reasons-stitch-fix-still-has-huge-upside-potential/ so, the report had a wider than expected loss. Okay? FCF was positive, unlike a lot of other companies during the "pandemic". This Motley Fool article perfectly reflects my own thoughts, it is almost like they read my mind. Take a gander. https://www.fool.com/investing/2020/09/24/stitch-fix-tells-investors-to-be-patient/

I would like to update my portfolio allocation for the Growth Fund as well as we head into the new year. I do not like telling people how much I have to work with, I do not think that helps anyone it just makes your ego bigger and when it comes to making money, your ego should be checked at the door.

Portfolio: Cloudflare at 71.96%, Stitch Fix at 22.37%, and Draftkings at 5.67%.

Barron's had a nice article on Draftkings https://www.barrons.com/articles/draftkings-stock-can-outperform-macquarie-analyst-says-51600967115?siteid=yhoof2 I usually do not like Barron's. I think their writers are awful, their analysis is poor, and they do not have a bigger picture outlook. But this guy Connor Smith, comparing DKNG to a company like Tesla, Amazon and Netflix? The title caught my eye.. So okay, the guy basically just breaks down Chad Beynons analysis on the technological advantage DKNG has, marketing expertise, brand awareness, etc. We know they have strong market share on sports betting and iGaming. Draftkings is certainly a tech/marketing company, I agree. Beynon is onto something here..saying that DraftKings original fantasy sports games is the luring aspect into gambling. Now this, this is something I never put into my analysis. It is almost like a gateway drug. I like this. The Barrons writer did nothing but regurgitate Chads analysis.

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