There are plenty of investment sayings about the dangers of following the crowd… but as an investor, watching the crowd can give you clues to where the market’s headed next.
So, when the Palm Beach Research Group team attended the MoneyShow investment conference in Orlando this week, I paid attention to what sessions attendees were crowding… and what they were avoiding.
PBRG team members Anthony Planas, Michael Gross, and Andrew Packer
at MoneyShow Orlando 2022
In today’s Daily, I’ll take a bit of an anecdotal look at what’s on the mind of retail investors right now… and share where we think the best opportunities will be in the months ahead.
Hedging Volatility
First, it’s clear investors are concerned about the stock market’s decline this year…
A trend many expected to continue… even before the Fed raised interest rates another 0.75% this week and warned of more hikes to come.
With that fearful outlook, it’s no surprise that sessions on volatility and hedging with options were popular with MoneyShow attendees.
My colleague Michael Gross uses this strategy in our Palm Beach Alpha Edge service… Except he’s not looking to earn a little extra income here or there, as some MoneyShow sessions highlighted.
By following strict discipline and taking quick profits… Alpha Edge subscribers earn hundreds of percent on trades in as little as a few weeks. (You can learn how to become an Alpha Edge subscriber right here.)
So while options are clearly on investors’ radar… many are unaware of the strategy’s full potential.
Attendees were also acutely interested in more traditional income investments… like blue-chip stocks with regular dividends.
But in contrast to the general advice they often receive, there are better strategies than just blindly buying and holding dividend stocks… and that often means waiting to buy until certain events happen.
For instance, at the Palm Beach Letter, we focus on dividend growth stocks.
These companies have a history of raising their dividends regardless of the economy… including a handful of companies that have increased dividend payouts to shareholders despite recessions and a global pandemic.
And as soon as the Fed stops raising interest rates, we expect markets to stop trending lower… creating an ideal point for adding more dividend growth stocks.
So it was great to see MoneyShow’s speakers emphasize fundamentals like hedging and focusing on income. Because as our subscribers know, those strategies are some of the safest ways to profit in markets like today.
But I was surprised to see a lack of attendee interest in one of our favorite market sectors… alternative assets with high-growth potential.
Hated Today, Profits Tomorrow
I’m a firm believer in buying assets when they’re hated, and for a simple reason…
Market sentiment can turn a modest deal into a huge bargain… And when sentiment shifts, asset prices can soar overnight.
Yet many attendees didn’t follow the big growth stories presented at MoneyShow…
There was sparse attendance at sessions related to investing in cannabis stocks, gold exploration companies with a potential mother lode, and alternative assets. (Cryptos weren’t even a theme for any of the sessions.)
Those sessions didn’t even cover those areas in the ways that we have at Palm Beach Research Group over the years.
We find the best alternative assets are what we call Maverick Investments – alternative assets that are real, rare, and enduringly desirable.
Maverick Investments often have high asymmetric return potential, where you don’t have to risk a lot to make a lot… and that’s a big reason we recommend owning trophy assets like collectibles.
These assets comprise a larger percentage of holdings for ultra-high-net-worth individuals than everyday investors.
Sure, part of that may be bragging rights… owning a Ferrari or a Picasso painting is often a symbol of status and wealth.
But another reason is that these assets tend to outperform the market…
They’re not liquid assets that trade every day like stocks… And when they do trade, it tends to be far higher than the initial cost.
So it’s no surprise that collectibles like a Michael Jordan jersey are setting record prices this year… but what really sets this market apart is that you don’t need to be a millionaire to get started.
You don’t even need $25,000, the minimum placement for a private investment showcased at MoneyShow.
All you need to get started in these Maverick Investments is about $50 or less, an account on a site like Rally, and a willingness to go against the crowd.
Platforms like the two above allow fractional investing in everything from classic cars to vintage comic books to fine art.
But here’s the real kicker: When you buy a fractional piece of a collectible, you are in control.
For instance, on one sports collectibles platform we recommend, a buyer made a $1.4 million offer for a 1952 Topps Mickey Mantle card.
But two-thirds of the owners rejected the deal for being too low, even though it would have been a 139.4% return in just a few years… and I have no doubt that when it does sell, they’ll see an even better return.
Getting Started in Collectibles
If you’d like to learn more about fractional investing in collectibles, Daily editor Teeka Tiwari has put together a presentation with all the details… and if you’re a Palm Beach Letter subscriber, you can learn how to get started in these investments here and here.
Teeka’s trophy asset investments have outperformed all his traditional investments combined over the last two years… and we don’t expect that to change any time soon.
In today’s volatile market, everyday investors are looking for ways to profit without needing a million-dollar bank account or obliterating their portfolio…
But if my visit to the MoneyShow is any indication, many of those investors have no idea of the opportunities available on the collectibles market… or that they can get started today for $50 or less.
Click here to learn more…
Good investing,
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Andrew Packer
Analyst, Palm Beach Daily