$ I’m Not a Financial Advisor $

I’ve been losing thousands of dollars daily in the market. This post I wrote in February outlined a few predictions I made in February. I know you won’t click it but I predicted UAVS will go to $3, short PENN at $120, NVAX isn’t worth $300 a share, and TSLA is overvalued. It wasn’t rocket science to know that valuations are the heart of the market and none of these stocks could back up their market cap with numbers. This is not a humble brag post but I’d like to share the lesson that there is no such thing as easy money.

When the pandemic was in its infancy, people panicked, sold all their stock, and bought as much TP and hid themselves in their bunkers. This presented a tremendous buying opportunity from an over-reaction to a once in a lifetime event which is what people like to do. Then the government flooded the economy with money so everyone stayed afloat, and now you’re seeing crazy inflation. Raw materials are getting so pricey that people are starting to turn away projects. This is supply and demand and we are now hitting that point of “shit’s fucked up.” This will take a while to even out and in the mean time there will be many people shit out of luck left in the wake.

I wouldn’t fault you if you sell positions to get back into cash. Make sure you have money on the sidelines for that next buying opportunity. You won’t know exactly when it will be (a 1,000 point drop in the Dow is usually a good indicator) and slowly ease the money back in. Do it into fund like Vanguards Total Index Fund, BRK-B or 2040 retirement. Take some gambles on stocks that are going to be in heavy demand for years to come like AMD (major chip shortage) or ELY (I just like golf). If you don’t know what a market cap is, you probably shouldn’t invest in individual stocks. When a company does $5 million in sales and is worth $1 billion, you should scratch your head and ask yourself does, “this make sense?”

I’ll close on the Crypto market because it’s fascinating. If you can’t explain to me why this is a long term solution to a fiscal problem, why are you investing in it? If you can explain that, why would you ever use a currency you only expect to go up? It’s not a currency. If you’re honest with yourself and say that you like to gamble, that’s a perfectly reasonable explanation, but if you’re telling me that CumRocket is the wave of the future because it has a great name, boy, I’m out of touch with reality. I will be putting 10k in Hoge coin fwiw.

Read This

Read through Ark Invest's Big Ideas 2021 report.

Here's a tweet and chart for each of the 15 ideas ?

1/ Deep learning to create $30T of market value by 2037

• Automated code writing
• AI that "understands" language (GPT-3)
• Big Tech spends billions on AI chips, everyone benefits

2/ Data centres will be totally transformed

• Intel (which powers 90% of data centres) has fallen behind
• Next-gen data centres/PCs will run on ARM standard
• GPUs (workhorse for AI) hits run rate of $41B in 2030

3/ Virtual world revenue hits $390B by 2025 (>2x today)

• Video game monetization shifting to in-app purchases
• Games are 3rd places (people spend 90m a day gaming in 2025)
• AR market (Snap, FB, Apple) set to explode
• Cost of VR (visual immersion) plummeting

4/ Digital wallets are a $4.6T opportunity

• In US, digital wallets surpassing bank account holders
• Digital wallet CAC lower than banks
• Fully featured digital wallet (ecomm, payments, insurance, credit, brokerage) worth $20k/user
• 230m Americans x $20k/user = $4.6T

5/ Bitcoin increases by +$40k if S&P 500 companies put 1% of their balance sheet cash to BTC

• Square, Tesla and Microstrategy set the precedent
• If S&P 500 companies make 10% of balance sheet cash, BTC rises by +$400k

6/ Mainstreaming of BTC makes it worth up to $5T

• BTC trading volume approaching large cap stocks
• Institutions have options to access BTC (e.g., CME futures)
• If institutional money (HNW, Pensions, SWF, Insurance) allocate 2.5%-6.5% to BTC, its price could rise $200k-500k

7/ EV sales will explode 20x: 2m (today) to 40m (2025)

• Total like-for-like EV ownership fell below Toyota Camry in 2019 (the sticker price will do same by 2025)
• "cell-to-vehicle" battery designs will increase volume density by 50% and further drop costs

8/ Automation adds 5% (~$1.2T) to US GDP in next 5yrs

• Rate of automation in next 5yrs = past 25yrs
• Industrial robot demands has hit an inflection point (willing to pay upfront cost for automation)
• More automation = higher productivity = higher wages = lower prices

9/ Autonomous ride-hailing profits $1T per year by 2030

• Ride hailing already $150B industry
• Improvements in AV make economics of robotaxis work
• Cost per mile of personally owned vehicle plummeting ($1.70 on a horse, 1871 vs. $0.25 for AV, 2025)

10/ Drone drastically reduce transportation costs

• Revenue by 2030: $275B (delivery), $50B (hardware sales), $12B (mapping)
• With improvements in AI and batteries, drones to be cheaper than cars, trucks, bike courier

11/ Orbital space hit $370B annually

• Global connectivity via satellites (provide internet for other 50% of population)
• Hypersonic point-to-point travel (turn 10hr+ flights into 2-3hr flights)
• Re-usable rocket prices dropping (= more satellites)

12/ 3D printing worth $120B by 2025

• Collapses time from design to production
• Shifts power to designers
• Reduces supply chain complexity
• Penetration levels: 50% in prototypes (market potential = $12.5B), 4% in molds/tools ($30B), 1% in end-use parts ($490B)

13/ Next-gen DNA sequencing worth $25B in 2025

• Shift from short-read (SRS) to long-read DNA sequencing (LRS) powers genomics revolution
• Bigger toolkit gives richer view into biology
• Used to be trade-off between accuracy (SRS) to comprehensiveness (LRS). No more tradeoff

14/ Liquid Biopsies to avert 66k cancer deaths per year

• ML-power DNA sequencing will allow liquid biopsies that can find cancer early (before solid tumor stage)
• Multi-cancer screening prices dropping
• Could prevent 66k deaths a year = 1.4m human life years

15/ TAM for oncology gene therapy rise 20x to $250B+

• This slide made no sense to me but here it is: "ARK Estimates That Allogeneic. Cells And Cellular Immunotherapies Could Create $250 Billion In Incremental Revenues."

16/ Follow @TrungTPhan for other hot business takes (and really dumb memes).

Original Ark Doc:


Originally tweeted by Trung Phan ?? (@TrungTPhan) on May 10, 2021.