Twenty years ago, at my old (now defunct magazine, Technology Investor, we researched the question, “Do inviolate (automatic) stop loss orders make sense?”
We studied many stocks and found that if they fell 15% you would have — on average — have been better off selling them.
Hence I’ve written often about “inviolate” stop loss orders.
My idea isn’t new. Books on investing nag about stop losses — 8% to 15% is the range.
Yesterday, one of my readers reminded me I had stocks that had dropped more than 15%.. And where was my inviolate stop loss?
OK. My most egregious stock was AFFIRM (after PayPal). Affirm had fallen from its high of $176 to $132 — down 25%. So I sold at $135.
The next day (yesterday) it jumped 14% after it expanded its deal with Amazon and making me look like a idiot.
These things happen — though not usually so fast.
To sum up:
My study of years ago showed you would have been better off selling on a 15% fall. It wasn’t just one stock. It was a bunch over at least a year.
Which brings me to PayPal. It’s down 35% from its high.
And I still haven’t sold. I am in love with the company. That’s stupid, and bad.
I thought it had reached bottom. Yet today it fell more. And that was despite the fact that our techie stocks did well today.
Tomorrow, I re-asses my relationship with PayPal.
Last night I bought some airline tickets with PayPal — flawlessly. Good.
Maybe it’s time to look at Square, also? It seems to be going nowhere fast. Ditto for V and MA (which I don’t own.)
Fintechs (financial technology companies) are out of fashion. I don’t know why. I’m an idiot for not seeing it earlier.
I have to figure a better way of setting alerts. My next project.
P,S. I actually made money with AFRM.
I bought some more Apple today
The New York Times technology writer did a review:
The Chip That Could Transform Computing
The article began:
For decades, the chip-making giant Intel reigned as one of the most technically advanced companies in Silicon Valley.
It was Intel’s co-founder Gordon Moore who famously predicted that computer chips would keep getting unimaginably more powerful. And it was Intel’s products, the x86 line of microprocessors at the heart of just about every personal computer, that turned Moore’s prophesy into a governing “law” of tech. The promise that every year, Intel’s new chips would be much faster than its old chips set the rhythm for advances across the entire industry.
But somewhere in the past decade, Intel lost the plot. It was blindsided by new trends — the rising utility of graphics processors, the widespread adoption of mobile devices — and beset by a series of embarrassing operational delays. Even more surprising than Intel’s slippage has been which company has come to succeed it as the pacesetter of processors. Meeting with employees early this year, Pat Gelsinger, Intel’s then incoming chief executive, was reluctant even to speak the enemy’s name — according to The Oregonian, he jokingly referred to the new chip champion only as “a lifestyle company in Cupertino.”
Cupertino, Calif., of course, is the home of Apple, whose focus on design, aesthetics and usability has often left it vulnerable to Gelsinger’s implication that its products are more fashionable than capable. But last month, Apple unveiled new laptops built around its own custom-designed processors, the M1 Pro and M1 Max, that have rendered such digs completely ridiculous.
Early reviews for Apple’s new machines have been so rapturous — “the most powerful laptops we’ve ever seen,” “dramatically better than they have any business” being, “just generally absurd” — that I worried I’d only be let down when I got my hands on one and it proved to be as frustrating as all computers always inevitably are.
I have not been let down. I’ve been bowled over. I’ve been using a new MacBook Pro with Apple’s fastest new chip, the M1 Max, for about two weeks, and I can’t remember the last time a laptop has wowed me like this. Actually, I don’t think a laptop has ever really wowed me, because it’s just a laptop.
You can read the entire NYTimes review here.
I love the words “Intel lost the plot.” I’ve watched Intel lose the plot for over 30 years. I can give you a much longer list than he had.
Rivian makes a fine truck, but a great investment?
Early investors are showing greater than 800% IRR from Rivian.
The Rivian truck gets incredible reviews: Motortrend wrote:
The 2022 Rivian R1T Is the Most Remarkable Pickup We’ve Ever Driven
Yep, we drove it. Are you ready for the electric truck revolution?
This is how they began their review:
The 2022 Rivian R1T is the first mass-produced electric truck to hit the U.S. market, but that’s hardly the most interesting thing about it. Its electric powertrain notwithstanding, the R1T is unlike any pickup we’ve ever driven—part truck, part sport sedan, and 100 percent amazing. It’s been speculated that pickup buyers are too conservative to embrace electrification, but after our first drive in a pre-production Rivian R1T, both on-road and off-, we think this is the electric truck that will turn them into believers.
There’s so much we want to tell you about the Rivian R1T that it’s difficult to pick a place to start, so let’s begin with the basic layout. Sizewise, the R1T is a tweener, slotting somewhere between a midsize pickup like the Chevy Colorado and a traditional half-tonner like the Ford F-150. The Rivian R1T’s shape and compact bed mimic those of “lifestyle” trucks like the Honda Ridgeline and Hyundai Santa Cruz, but it’ll tow 11,000 pounds according to Rivian and rock crawl like a Jeep Gladiator according to us. And it jets around corners like no pickup truck ever has.
Read the rest of the review here.
It’s a nice looking truck.
Rivian has had a stellar IPO. It came at $78. This chart shows what it’s done for its first two days — to $122.98 Thursday close of business.
For us unwashed who didn’t get in on the IPO or the earlier money raises, the question is simple: Should we buy now?
At last night’s price, RIVN’s market valuation is $120 billion, compared to Tesla’s $1 trillion, but much larger than Ford’s $78 billion or GM’s $90 billion.
Rivian will sell a few trucks next year, but the big sales will not happen until 2023. That’s a long time for the present excitement to wear off and maybe the price will come in.
I’m waiting.
Texas research is grim for the unvaccinated
From the Washington Post:
+ ‘New research out of Texas offers a grim illustration of the risks of not getting vaccinated. The state health department found that unvaccinated people accounted for more than 85 percent of the Lone Star State’s 29,000 covid-linked fatalities between mid-January and October. Seven percent of the deaths were among partially vaccinated people, while about 8 percent were fully vaccinated. Put another way: the unvaccinated in Texas were 40 times more likely to die of the disease than those fully vaccinated.
Want to know the real problems are in the supply chain?
Read this article by a trucker, who explains all (or some of all):
I’m A Twenty Year Truck Driver, I Will Tell You Why America’s “Shipping Crisis” Will Not End
Click here.
So Daylight Savings Time saves me time?
This weekend it took me an hour to change all our clocks.
Fat time saver!
Useful stuff
+ Questions with Amazon? Email Jeff at Amazon.com. That’s Jeff Bezos.
+ The best two places to rent houses are Airbnb and VRBO (which is owned by Expedia).
+ Known Traveler number is the same as Pre-Check. You need to know that if you’re buying online tickets.
+ Don’t fill in the box labeled Redress.
Best cartoons
That’s it for tonight.
I want to look at “alternative” investments — Are they any good?. I’m looking at sneakers, paintings, NFTs (non fungible tokens), crypto, private oil wells, distressed real estate…. Look at this. People are paying top dollars for sneakers they collect, but don’t wear.
If you have any favorite, wonderful, non-traditional investments, please let me know. More on this tomorrow. — Harry Newton
