Investing in 5G Stocks

As long as the bull market still runs, I believe the best investing area will be in 5G related stocks.  This can be the communication tower companies like AMT and SBAC along with providers and companies which will make chips for 5G.  It is possible that the chip related stocks will be the biggest gainers.

Skyworks (SWKS) will be making 5G phone chips and auto chips.  Taiwan Semiconductor Manufacturing (TSM) will be manufacturing 5G chips and advanced small scale computer chips, and ASML will be making equipment so that 5G chips and advanced computer chips are possible.  These are the top three stocks that we should load up on.

When Negatives Really Matter To Stocks

The ten year old bull market does not want to die, and many investors have been gored by the bull.  However, sometimes multiple negatives can send the market crashing as the Dow lost 343 points on October 1, 2019.  Real impeachment talk, a PMI of 47.8 for manufacturing, and no resolution in the China trade lead to the bear chomping hard on the bull today.

I already held a significant position in TMF, the triple long bond ETF, but I am planning to buy more tomorrow.  People have been talking about a bond bust for years, but it has never happened, and it cannot happen while we have multiple serious negatives since people will always run for security in troubled times.  This is a winning trade although I will take profits at certain times.  I am following the MACD cycle primarily for this trade, and I will be buying as the signal line moves up.  Then, when I see it make a new high while the MACD starts to fall, I will sell while I am up.  Sometimes it can take months to get a good trade setup, but it is well worth trading when you have the chance.

Dog Days of Summer Stocks

August and September are not good months for stocks.  Whether stocks rally again this fall or not, we need to be concerned also that the Dow has broken its 200 day moving average three times since last fall.  This is an unmistakable sign of a market top even though some people may not want to hear that.

Is it time to go short then?  No, that won't work either because too many people want the bull market to continue, and someone once said that the market can remain irrational for longer than you can remain solvent.  So, you will be gored if you act too soon.

What I am doing myself is building positions in dividend stocks.  One stock is BLV, Vanguard's long term bond ETF.  It is up 15 percent since last fall in addition to a dividend of around 3.5 percent.  The management cost for you to own the ETF is also almost nothing.

Another stock that I own is Pimco's Income Strategy II Fund, PFN.  It is currently my largest holding.  It pays a dividend of around 8% per year, and you get paid part of that each month.  I love monthly dividend stocks.  Management costs are more than 1%, but I think the stock is very much worth owning.

I am working toward having a portfolio comprised of at least 50% quality dividend stocks so that I don't have to worry about stock market volatility.  It is okay to take some risk, but you need to be able to sleep at night knowing that half of your money is reasonably safe.

Buy With The Insiders For Stocks

We are currently in a topped out stock market where you cannot just buy a popular stock and expect it to go up.  If we expect to make money, we must buy the stocks that are currently being bought by insiders because they are expecting their stocks to go up.  The best website I have found for tracking insiders and cluster buys is OpenInsider.com.  You will see the latest insider and institutional investor buys and sales.  You can also search for your favorite companies to see if big buying is occurring in stocks that you like. 

2019 Stock Trends

2019 may become a difficult year for stocks as it was in 2018.  With trade wars and Congress gridlock, the market will be hard to predict.  However, since the Federal Reserve finally took a dovish stance, we probably won't have a recession this year.

The biggest and most predictable trend that I see is with marijuana and hemp stocks.  CBD oil for medicine can be made from both plants, and there is a strong demand for CBD oil.  You could do an internet search for pot stocks and hemp stocks and take your pick.  They will probably all be volatile.  Nevertheless, if you buy at the bottoms and take profits at the tops, they could be worthwhile trades.  You could also keep a core position in each one.  This is what I am doing.

Some of the biggest marijuana stocks that I own are CGC, CRON, and HEXO.  I also own penny stocks in this area that I cannot recommend yet.  Anyway, probably around 50% of my portfolio will be locked up in this sector while the trend is solidly positive.