Investing and finance thread

[Jolly Blue Giant]

what do people think of Catherine Woods and the funds she manages?

For the last few years she was the next Warren Buffet. Now she has fallen like a rock and her portfolios look a lot like those who put their money in meme stocks. She has been tech heavy and aggressive and has ridden that wave, but it has cost her much in the past few months. I think of her as a fallen rock star

[MightyGiants]

For the last few years she was the next Warren Buffet. Now she has fallen like a rock and her portfolios look a lot like those who put their money in meme stocks. She has been tech heavy and aggressive and has ridden that wave, but it has cost her much in the past few months. I think of her as a fallen rock star

Personally, I think there were a couple of things at play.  First, it's easy to look like a superstar in a bull market.   Second and more importantly I think she hit it out of the park on a few of her picks and things sort of snowballed.  About a year ago on advice from a savvy investor friend of mine, I looked into her funds.   At that point in time, it appeared that the massive money that was following her at that point was doing more to move the needle on the stocks she picked than the companies who were represented by the stock.   In other words, when she picked a company, everyone wanted to be part of it, driving up the price, plus her funds were so big that she the fund's purchasing power alone would impact the stock

[Jolly Blue Giant]

Personally, I think there were a couple of things at play.  First, it's easy to look like a superstar in a bull market.   Second and more importantly I think she hit it out of the park on a few of her picks and things sort of snowballed.  About a year ago on advice from a savvy investor friend of mine, I looked into her funds.   At that point in time, it appeared that the massive money that was following her at that point was doing more to move the needle on the stocks she picked than the companies who were represented by the stock.   In other words, when she picked a company, everyone wanted to be part of it, driving up the price, plus her funds were so big that she the fund's purchasing power alone would impact the stock

Your friend is spot on IMHO! I know several people who would buy a stock she picked knowing full well the wave was created by her monetary input and her followers. And after she would buy a few million shares, a lot of techies and meme stock followers poured in from nowhere wanting to catch the wave - a wave she created and that was the only reason there was a wave. Made her look like a genius. But all that has changed since all big fund companies are looking ONLY at value and a lot of meme followers have gone belly up after getting their margin calls. I remember when she bought millions in SKLZ last year and I was going to buy some to ride her wave but decided against it because I didn't see the company as going anywhere. She has since dumped a lot of it. Another stock she propped up with her own funds was NVTA - a medical genetics company, which I bought and sold a couple of times, but have since avoided all pharm and medical companies since last summer...dittos with crypto. NVTA is down nearly 80% since she bought about a half billion worth. I don't know if she can recover as a lot of wealthy folks putting their money in her hands are taking it back out and putting it in Blackrock or some other conservative fund

[Jolly Blue Giant]

[Bob In PA]

A stockbroker is someone who invests other people's money until it is all gone - Woody Allen.

[Rosehill Jimmy]

A stockbroker is someone who invests other people's money until it is all gone - Woody Allen.

[MightyGiants]

Are there even people left who call themselves "stockbrokers"   

[Jolly Blue Giant]

Are there even people left who call themselves "stockbrokers"   

That's a good question. I bought stock through a stockbroker in Ithaca back in the late 70's because that was how you did it...the only way if I recall...and the broker got a commission. Now painless and no commission buying and selling is pretty much only done on electronic trading platforms on the internet, I can't imagine someone making money as a broker - maybe as an advisor, but I don't have one of those

[MightyGiants]

That's a good question. I bought stock through a stockbroker in Ithaca back in the late 70's because that was how you did it...the only way if I recall...and the broker got a commission. Now painless and no commission buying and selling is pretty much only done on electronic trading platforms on the internet, I can't imagine someone making money as a broker - maybe as an advisor, but I don't have one of those

A little after 2000, I went back to school to learn computer networking.  One of the guys in my class was a stockbroker.   Back then, he saw the handwriting on the wall in terms of his profession and oddly enough wanted to be part of what eliminated his job (improvements in computers and networking)

[Jolly Blue Giant]

A little after 2000, I went back to school to learn computer networking.  One of the guys in my class was a stockbroker.   Back then, he saw the handwriting on the wall in terms of his profession and oddly enough wanted to be part of what eliminated his job (improvements in computers and networking)

Smart guy. One thing taught in management classes in school is to always look to the future for change. The most common example was the largest buggy whip company in America. At the turn of the century, automobiles were starting to show up, but the company did not believe cars would ever fully replace horse and buggy so the CEO built bigger factories to produce more buggy whips anticipating a surge in growth as population growth was rampant. They went bankrupt.

I live near a factory that was the most profitable and largest company in the county called "Smith Corona". I knew plenty of people who worked there or had worked there as it was a huge operation that hired thousands of workers. In the 80's, company management did not believe that personal computers would ever make the typewriter obsolete. By the time they realized it, it was too late. They tried to salvage the company by coming out with a "word processor typewriter" with a small screen, keyboard, and their own word processing software. They sold a few before going belly up and Smith Corona is no more...at least as a typewriter manufacturer. The salvaged some of the business by becoming a thermal label producing company. Nothing like their past when they were typewriter king

[MightyGiants]

Smart guy. One thing taught in management classes in school is to always look to the future for change. The most common example was the largest buggy whip company in America. At the turn of the century, automobiles were starting to show up, but the company did not believe cars would ever fully replace horse and buggy so the CEO built bigger factories to produce more buggy whips anticipating a surge in growth as population growth was rampant. They went bankrupt.

I live near a factory that was the most profitable and largest company in the county called "Smith Corona". I knew plenty of people who worked there or had worked there as it was a huge operation that hired thousands of workers. In the 80's, company management did not believe that personal computers would ever make the typewriter obsolete. By the time they realized it, it was too late. They tried to salvage the company by coming out with a "word processor typewriter" with a small screen, keyboard, and their own word processing software. They sold a few before going belly up and Smith Corona is no more...at least as a typewriter manufacturer. The salvaged some of the business by becoming a thermal label producing company. Nothing like their past when they were typewriter king

A couple of others:

Kodak, failed to see the end of film cameras.   Their expertise could have given them a leg up in the printer industry (especially photo printers).   

Sears-  this one kills me.  They had all the means to be Amazon before there was an Amazon.  They had the catalog system, which isn't much different than ordering online, and the warehouse and distribution system.   I mean looking back you would have thought of all retailers Sears would have had the easiest time not only adapting to E-commerce but thriving as an early entry

[Bob In PA]

Sears is an outstanding example, but IMO an even bigger corporate blunder was IBM.

They "surrendered" the entire field of personal computer operating systems to Microsoft, and entered into a truly HORRIBLE deal.

If I had owned IBM stock back then I'd have chartered a plane to their corporate headquarters... (and taken a gun with me? lol).

Bob

[MightyGiants]

Sears is an outstanding example, but IMO an even bigger corporate blunder was IBM.

They "surrendered" the entire field of personal computer operating systems to Microsoft, and entered into a truly HORRIBLE deal.

If I had owned IBM stock back then I'd have chartered a plane to their corporate headquarters... (and taken a gun with me? lol).

Bob

It's sort of interesting.   By its very nature, IBM was a forward-looking company in the tech field.    Their blunder wasn't in not seeing the future of the PC but in failing to recognize the real value was in the operating system (at the time DOS which eventually became Windows) rather than in the hardware and the making of the actual computers.  So unlike most of the other examples where the companies failed to hop on the future train, IBM simply got on the wrong train.

I will tell you, I wonder if oil companies will be the next of the corporate dinosaurs.  I own stock in Chevron and I often debate when to sell it.   I see the future in electric vehicles and these sky-high oil prices are only going to accelerate that trend, in my opinion.  I also own a gas pipeline stock and a stock that ships LNG but I think natural gas will last longer than oil which will still have demand, just at a much lower level.

[Jolly Blue Giant]

Sears is an outstanding example, but IMO an even bigger corporate blunder was IBM.

They "surrendered" the entire field of personal computer operating systems to Microsoft, and entered into a truly HORRIBLE deal.

If I had owned IBM stock back then I'd have chartered a plane to their corporate headquarters... (and taken a gun with me? lol).

Bob

I have a lot of insight to IBM as it started in Broome county where I've spent most of my life. My Dad was born and raised in Endicott and used to throw snowballs at Tom Watson who would occasionally throw a snowball back at him and laugh. The company I worked for for years was Universal Instruments Corp. (computerized and automated PC Board populating machinery) which was invented at IBM who then wanted out of the business and handed it to Universal who had been subcontracting the machines anyway and by the mid-90's, Universal had itself become a Fortune 500 company in which much of its management came from and emulated Kodak and Xerox out of Rochester. In the 80's, IBM had around 20,000 employees in Endicott and was the largest company in Broome county. By 2000, it had about 500 employees, by 2010, about a hundred. After the Watson family died off and they put the company in the hands of Lou Gerstner (CEO of Nabisco), IBM went from the best company in the country to work for to one of the worst. Gerstner took Jack Welch's philosophy hook, line, and sinker - "lean and mean" - and started getting rid of employees, cutting wages and benefits, cutting products that weren't extremely profitable, and decided that "main frames were the future" and the PC business too competitive and unprofitable. He was wrong. Their software engineers were more advanced than Microsoft, but didn't feel software was the future...really bad decision.

Regardless, ninety percent of every millionaire in Broome, Cortland, Tioga, and Delaware counties as of the late 90's came as a result of working for IBM and buying their stock at a discount back in the late 50's to the 70's. My uncle was one of them. Now the handful of employees that still work for them make McDonald's wages and have few benefits and the company is a shadow of its former self.

[Bob In PA]

I will tell you, I wonder if oil companies will be the next of the corporate dinosaurs.

Rich: IMO not going to happen.  Why not? 

The vast majority of oil companies (I don't know for sure about Chevron) saw the handwriting on the wall long ago and are working to establish a presence (whether dominant or not) in alternative energy.

That IMO is even more true of the non-US-based companies (which are some of the largest in the world).

Bob