Author: Smart Investing

Cryptocurrencies

Swan Bitcoin: Bitcoin’s Billion-Dollar Arms Race Heats Up!

Posted on by Smart Investing

Over the past few years, several companies have started to add bitcoin to their balance sheet. Regulatory agencies have finally provided clarity on how to value bitcoin holdings. That makes it easier for companies to do so.

Buying and holding bitcoin allows a corporation to benefit from the long-term upside of bitcoin. And buying bitcoin today reduced the amount on exchanges available for sale. Given bitcoin’s hard-coded scarcity, that could help fuel a price increase for bitcoin.

Some now project that bitcoin could rally as far as $180,000 by the end of 2025. That’s creating a demand for new companies focused on buying bitcoin.

The latest company is called Twenty One Capital, a reference to the 21 million maximum bitcoin that will ever be mined. The venture will launch with 42,000 bitcoins. And it’s backed by several large crypto venture funds, including tech investment giant SoftBank Group.

Twenty One Capital will join the ranks of companies like Strategy (MSTR), which has become the leader in acquiring bitcoin. Strategy has even employed stock sales, debt issuances, and preferred share offerings to raise capital. Today, Strategy owns over 550,000 bitcoin.

Consequently, the shift towards higher prices in recent weeks likely has more room to run as companies keep buying. Individual investors can also buy bitcoin to profit from a move higher.

 

To see the full analysis on corporate bitcoin buying, click here.

 

Income investing

Dividend Growth Investor: Eleven Dividend Growth Companies Raising Dividends Last Week

Posted on by Smart Investing

While dividend investing isn’t as glamorous as hitting a home run with a growth stock, over time dividend stocks can provide slow-and-steady returns that beat the market. Plus, they can provide a growing stream of income that can be used to fund retirement.

With markets still looking to regain their footing, investors can still buy high-quality dividend stocks off their recent highs. That provides a better entry point, as well as a higher starting yield.

Recently, 11 companies raised their dividends for at least the 10th consecutive year.

One such company is the financial services company MetLife (LET). MetLife offers insurance, annuities, and asset management services, all of which can be more steady than bank stocks in a market crisis. The dividend was raised by 4.1% for the 13th consecutive year, and shares currently pay a 3% dividend.

Another company with a recent dividend increase is Nasdaq (NDAQ). The technology company that serves capital markets raised its payout by a hefty 12.5%. Nasdaq currently yields about 1.3%, but has also grown its dividend for 13 consecutive years.

Both companies have a strong brand, relatively few competitors, and high barriers to entry. Those factors should allow them to continue growing their dividend payouts over time. Today’s investors could see big returns as higher dividend payments lead to higher share prices.

 

To see the full list of companies raising their dividends now, click here.

Income investing

Bigger Pockets: REITs Might Be in Jeopardy

Posted on by Smart Investing

Market sentiment has shifted negatively in the past few weeks. Rising uncertainty has led to a selloff in all asset classes, even supposedly safe ones like bonds.

Even real estate has suffered. The selloff in bonds has pushed interest rates higher, and kept mortgage rates high as well. That makes it more difficult for the housing market to match supply and demand. It also puts real estate at risk of declining to meet the current supply and demand equilibrium.

During a recession, real estate investment trusts (REITs) have a history of declining 17.6% on average. That’s a bit less than the stock market, which typically has a 20-50% bear market in a recession.

Unlike your home, however, REIT valuations can be changed by the market every day. And as a result, data shows that REITs underperform privately owned properties in the four quarters proceeding a recession.

On the plus side, REITS outperform in the four quarters after a recession. So investors who buy REITs can see higher returns, in addition to the cash flow that REITs provide.

Of course, today’s REITs offer robust diversity against several types of real estate. Today’s buyers should look at data center REITs, which play to longer-term trends in AI. And REITS related to healthcare, which has strong long-term demographics behind it. And finally triple-net lease REITs, which pass on rising costs to their renters.

 

To see the full advantages and disadvantages of REITs right now, click here.

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Economy

Nolan Matthais: This Is What “ALWAYS” Happens Before a Market Crash

Posted on by Smart Investing

A market crash can erase years of gains in just a few months. Given the size of today’s financial markets, a crash will wipe out trillions of dollars of wealth.

However, before market crashes, there are usually some signals of an overheated market.

Understanding these signals can help avoid the worst of a crash. By avoiding losing too much during one of the market’s inevitable pullbacks, investors can be better prepared to profit from the rebound.

What do market crashes have in common? Most start when investors are overly optimistic. That can be measured by high amounts of leverage. That was true in the 1929 market crash, when many individual investors were able to buy on margin.

Today, traders can use tools such as options and futures to go beyond a margin cap in a typical brokerage account. And as of January 2025, right before the latest bear market kicked off, leverage was at a record high.

Another factor behind market crashes can come from trend following. In the months leading up to the 1987 crash, traders started using program trading. These programs would start to sell positions as they sold off. But when everyone rushed for the exit, disaster occurred. In this case, a one-day, 22% decline in the market.

Clearly, traders who deleverage when markets move higher and who get out before the trend shifts can avoid losses.

 

To see the full factors at play before a market crash, click here.

 

Stock market

FX Evolution: The Last Time This Happened Was 1998…

Posted on by Smart Investing

The stock market is finally back to a most-traded zone after a few weeks of extreme uncertainty. Markets spent the week largely midway between their prior (and all-time highs), and the recent low.

This zone could allow for market structure to form, allowing for a move higher over time. That will make it easier to trade, although it will also mean declining volatility as trade war headlines recede or turn positive for markets.

The latest trigger signal of several thrust indicators also suggests that markets may have hit their lows for now. They could retest those lows later in the year, especially if the tariff news results in a measurable slowdown in economic activity.

Overall, these factors are similar to the market action in 1998. That’s when the tech bubble was starting to form. But several news events caused a major pullback in markets, only for them to go on and make prior highs.

If the historical similarity holds, markets could be in for a sideways few months. After that, they should start to break free later in the year.

For now, investors can use big down days in the market to add to industry-leading companies. And continue to focus on non-tech companies. Tech’s dominance in the market has declined since the start of last year, suggesting other sectors such as healthcare may continue to lead.

 

To see the full analysis, click here.

Commodities

The Free Press: James Grant: The Case For Buying Gold

Posted on by Smart Investing

Gold prices topped $3,500 per ounce this week. The metal continues to perform strongly in 2025. While stocks are still in correction territory, gold is up nearly 30%.

The metal has risen quickly in recent weeks, and may need to take a breather for a bit. But the fundamental reasons for gold’s rise remain intact. And since that’s the case, investors could be on track to see further returns in the metal this year.

Unlike in the 2010-2011 gold bull market, retail investors have been largely absent in this rally. Instead, it’s been central bankers making the big buys. That includes China, which may be liquidating dollars to buy gold. But also countries like Russia and Turkey.

With many nations around the world pulling back from international trade, gold stands out as a strong reserve holding. Rising political fears and monetary disorders make a strong case for holding gold.

With talk of an audit of America’s gold holdings at Fort Knox, some see more room ahead for gold.

That’s because there could be some use of that gold. It could be sold in part to acquire bitcoin or pay down the national debt. Or it could be used to back the U.S. dollar.

Either way, things are shaping up for a further increase in gold’s price in the months ahead. The next few weeks may be volatile, but could be a worthwhile time to add to gold or gold stock holdings.

 

To view the full case for gold now, click here.

Stock market strategies

Tastylive: How I use Market Fear to My Advantage

Posted on by Smart Investing

Markets are in fear mode right now. That’s creating opportunities for investors and traders alike. Investors can buy great companies at a discount to their recent highs. That can mean buying a lower earnings multiple. Or, getting a higher starting dividend yield on income-paying stocks.

Traders have some advantages here as well. Market volatility is high. Big daily swings can be used to generate bigger profits. Or, the same profits with less capital than during calm periods.

Higher market volatility changes many variables in the options market. Changes in strike distances can lead to a bigger skew. This is where there’s a pricing mismatch between puts and calls.

For instance, a stock that’s been heavily hit in a market selloff may have a high skew in the put options. But buying the call options could mean a better bargain, especially if the stock rebounds.

Another factor is strike distance. That takes advantage of traders with a longer-term time horizon than short-term traders.

Rising market volatility tends to calm back down over time.

Traders who sell options when volatility is high can often profit as volatility declines. That’s true even if the underlying stock doesn’t make a significant move in either direction.

Market fears come and go. Fortunately, they can create more lucrative trading environments for those who know hose to take advantage of them.

 

To see the full impacts of skew and strike distance in volatile markets, click here.

Cryptocurrencies

The Pomp Letter: Here Is Good News About the Stock Market & Bitcoin

Posted on by Smart Investing

Market uncertainty remains high. Monday’s 3% drop and the big gains on Tuesday, Wednesday, and Thursday, suggest that volatility is still the name of the game. But within that current market fear, there are some signs that things may start trending better in the months ahead.

One sign is that the more markets decline, the more likely they are to recover. Statistically, once stocks hit a 20% pullback, they tend to find some strength. Markets hit such a level last week.

Plus, global liquidity is on the rise along with the current uncertainty. Central bank liquidity gives businesses time and wiggle room amid trade and tariff headlines. Rising liquidity tends to mean higher asset prices over time, including stocks, gold, and bitcoin.

Usually coming out of a bear market decline, more speculative assets see the biggest returns. That includes small cap stocks, and in more recent cycles, bitcoin. Given the market’s love of big-cap tech stocks over the past few years, those companies may also benefit from a rallying market. However, there could still be a shift underway towards smaller-cap stocks.

While there’s no guarantee that stocks have bottomed, statistics make the case for stocks to find their footing here. Investors who start to put capital to work can likely see reasonable returns in the months ahead.

To see the full analysis behind the market pullback and what it means, click here.

Stock market

Lead-Lag Report: The Myth of Market Efficiency with Cullen Roche

Posted on by Smart Investing

One of the key investment theories underlying investment ideas is known as the efficient market theory. The EMT states that any new information about a company or the economy is instantly digested.

Under this theory, investors are best to simply buy a market index. Beating the market is theoretically unlikely over long periods. Or such success can simply be attributed to luck rather than investment skill. The problem with this theory? It’s simply a myth.

 That’s because prices are always adjusting to new information, not because they’re right. Rather, it’s because they’re wrong.

Markets were wrong in 2020 about the impact of the pandemic, then sold off heavily. Then they soared following a flood of stimulus money. Only to slide again as that stimulus led to inflation.

Financial markets, no matter how sophisticated or computerized, remain subject to human whims. Emotional responses can cause the irrational to feel rational.

Today, with market uncertainty rising, investors who have blindly bought the dip are down and out for now. Over time, it’s likely that the market will recover. But how long that takes and the shape it takes can matter for returns.

Even great investors can get caught up in emotional traps, and with it, see poor returns.

 

To see the full impact of how markets aren’t as efficient as they seem, click here.

Economy

Bravos Research: This is Real

Posted on by Smart Investing

Rising tariff rates in the United States are now back to levels last seen in the 1930s. Most recognize that the massive tariffs of the 1930s did little to spur economic growth. Quite the opposite. The economy shrank.

That suggests that tariffs are deflationary, not inflationary. The costs of imported goods will rise overall. But falling exports and declining imported volumes more than make up for those changes. If that holds true today, markets could be in for a rough ride.

Declining global trade didn’t start the Great Depression in the 1930s. But it arguably extended and deepened it. Today, shifting tariff rates reflect a desire to unwind decades of increased global trade. And to increase domestic manufacturing.

For some sectors, such as defense, domestic manufacturing makes sense, even if it’s not economically efficient. For other sectors, however, such as textiles, it seems like a massive inefficiency.

While the economy sorts out new tariff rates and even trade deals, uncertainty is the likely outcome in the months ahead. That will keep markets volatile. And it will take a significant trade deal with major partners and clear benefits. Until that happens, markets are unlikely to move back to all-time highs anytime soon.

It took decades for global trade to recover from the 1930s tariffs. This time around, it will likely move faster. But it will still mean havoc to the economy in the coming quarters.

 

To see the full analysis, click here.