Early Retirement Extreme Forums

Nothing ever goes straight up or down. Three months from now analysts will be asking why AMZN hasn't capitalized on the WFM purchase and start saying AMZN is faltering. Some news agencies will pick it up and run with it, and some AMZN delivery truck will hit some little old lady and...the pullback appears. But, who knows, you might be right. Maybe I never get more, which is fine. I don't like buying companies, even historic ones, near highs.

Why is amazon still considered a tech company? I saw Bezos was at the WH yesterday with Schmidt and Cook and wondered why amazon is lumped in with Alphabet and Apple.

I guess it inherited the trait from the dot com era? Any business that was online as a front-end is a tech company. Like, do you consider EBAY, ETSY, UBER, or NETFLIX a tech company today? Then again, at least amazon gets some good money from AWS and kindles.

AWS supports this image as well. They have done a lot of pioneering in the cloud tech space.

Also, why break a catchy acronym (FANG)?

Amazon is most definitely a tech company. It's not what they sell, 99% of their stuff is sold by other stores, or that they deliver. It's how they sell and how their systems allow them to be efficient.

Some of their tech stuff:
- Prime video
- Prime music
- Warehouse robots
- Efficient inventory systems
- Efficient delivery systems - I can get some stuff the same day in DC.
- Echo (AI) and machine learning
- Data - Customer, vendor, delivery, etc.
- AWS - If AWS was a stand alone company it would still be in the Fortune 500

Selling physical goods is what everyone sees, but their real business is all behind the scenes. The physical goods are the proverbial tip of the iceberg.

A better question going forward is what company isn't a tech company? Wal-Mart just bought Jet.com trying to catch-up to Amazon. I have also noticed, as I have looked for jobs in the San Fran/San Jose area that Wal-Mart is hiring a lot of high level tech people for their operations in that area.

This world needs less acronyms not more.

Anyway. I think SHOP will ride up with AMZN as the digital storefront providers while AMZN handles distribution of the product. I bought in today at $111 Canadian, let's see how this goes. If I can make 10% in under a month, I'll be happy. If not, I believe in the business long-term.

Someone controlling a lot of shares dumped OHI today at the open, possibly in fear of Medicaid/Medicare reform.

Sold (short) WMT.

Mostly I think their free 2-day shipping will be a disaster. Don't think their relationship w/ vendors is healthy enough to profit so nicely w/ AMZN competition. I was in a store the other day because they had my (uncommon) motor oil on a deep discount, but turns out none were on the shelf. I suspected a pricing mistake because they had overflowing product for the same brand but different spec and for the same product in the auto parts store would be >2x the cost. However, I saw it on their website with free shipping. Sure, why not! (On second thought... Maybe I should re-order even more motor oil..) Meanwhile AMZN is pulling more people into Prime even though it's not such a great deal now.. and if you don't have Prime the free shipping (orders over $35?) is slow as molasses.

Doubled down on my JP Morgan Chase (JPM) position yesterday (7/3/2017), here is my reasoning:

Interest rates are going up and the Fed has signaled this will continue. JPM just had their capital return plan approved and will raise its dividend to $0.56 from $0.50, along with an almost $20 Billion dollar buyback plan. JPM continues to have a strong balance sheet and has avoided the impending subprime auto loan issues that are starting to hit Capital one, Ally and Santander. I think JPM is priced more reasonably than most of the regional banks, and feels better run than competitors like Bank of America. One big worry is the succession plan for Jamie Dimon.

cmonkey wrote: ↑

Thu Jun 15, 2017 8:49 am

Any thoughts on SSW? Seems their biggest headwind might be the future of international trade agreements, but I don't know how much these concerns will pan out since Trump can't seem to get anything done. Revenues are higher than ever, but have plateaued a bit. EPS has gone down due to more shares being issued. P/E and P/B are very good.

I hope you bought some of it.

Chad wrote: ↑

Wed Jul 05, 2017 11:05 am

I hope you bought some of it.

I have not yet but am still considering...reason?

Just the recent run-up. No fundamental reason.

Ok. I do have some cash sitting around so thanks for reminding me of them. Today's pull back looks nice.

Pardon the double post, but maybe here it will have more visibility:

I have been thinking about commodities, first because all indexes are close to multi year lows, and recently I saw this:



My question would be, what would the best instrument to buy a well diversified basket of commodities without suffering extreme issuer risk/blowup of the instrument risk?

I've looked at
DBC - powershares db commodity index tracking fund - 0.89% TER
GSG - ishares s&p GSCI commodity indexed trust - 0.75% ter

Any recommendations?

I'd recommend GSG based on TER and that fact that if Blackrock goes out of business/blows-up then we all have bigger problems.

I have a few other comments though if I may.

-These indexes track future contracts making it truly pure commodity play but would you not rather own upstream/production companies?
-TER seems high for my liking on both of the options you presented.
-Do you want to own future contracts on grain/livestock/industrial metals or are you trying to buy the dip in energy?

I don't know anything regarding cows but I can speak a bit to oil & gas. Find a light crude/low debt oil company or a liquids rich/low debt gas company and go nuts. If I had cash right now, I'd take a look at Vermilion Energy. Owns production all over the world, hedging political/pipeline risk and can focus on areas that have stronger prices. Relatively safe/high dividend. Good management, great track record. That's my highly technical DD Edit: I thought Vermilion traded on the NASDAQ as well as TSX but they only trade on TSX and in France.

Back to your question, in Canada we have an ETF called XEG (TER = 0.62) that tracks oil and gas companies rather than futures. I'm sure you can find something like for Europe/U.S.A. if you don't want to go stock picking.

Bought some SSW and TEVA in the last few days.

http://www.convexitymaven.com/images/Co ... e_Edge.pdf

Curious that he thinks tax policy will be the next trigger. (can't tell if it's just the personal bias of a rich person who doesn't want his taxes to go up)

Seppia wrote: ↑

Mon Jul 10, 2017 7:46 am

I have been thinking about commodities, first because all indexes are close to multi year lows, and recently I saw this:

I've bougth an index etf with a basket of commodities. Right now, I do like that they are pretty much uncorrelated with equities and that they could be to multi year lows. But you never know. Underperformance in the past is no garantuee for increasing prices in the future. The very low ratio between commodities and equities is attracting. Maybe I am gonna buy some more of it when I see more positive signals.
@Seppia: Are commodities a fixed part in your portfolio asset allocation or do you want to use the upside opportunity?

My favored USA electric utility, AVA, is being bought out by Hydro One, a Canadian firm. Yay, got a 20% jump in share price! Boo, I need to find a new electric utility.

Deal won't complete for a year, assuming it passes regulatory approval, etc. Sold off about half the shares today since I think I can do better until the sale is final (or if sale fails).

My SHOP is up 13% as of this morning with latest earnings. This is where I would love some help as a trading novice.

distracted_at_work wrote: ↑

Thu Jun 29, 2017 5:11 pm

I bought in today at $111 Canadian, let's see how this goes. If I can make 10% in under a month, I'll be happy.

Technically I didn't hit my criteria (by 3 days) so do I hold? The earnings this quarter were extremely promising and every article I've read is very bullish. Would I be getting out of the next Amazon or am I taking smart profit off the table?

Edit: I am a coward and took my 13%.