Month: March 2014

My Latest Stock Picks…..Q1 Update


With Q1 coming to a close, it’s time to figure out what’s going on in the markets and where might be some good places to be over the next 6 months.

The markets have been choppy year-to-date, but have managed to hit new all-time highs in the last week or two. The particularly discouraging part of the new all-time highs was that not very many stocks made their own new highs. Meaning this all-time high is weak and only a few stocks pushed it to these new highs. That’s NOT good.

And there are some bubbles that are forming (man do I hate that word, “bubble”). In particular, IBB (a Biotech ETF) has been pushing the NASDAQ to all-time highs. Volume in penny stocks (stocks under $5) have hit a high since the tech bubble in ’99/2000. Below is a checklist that I saw in the Wall Street Journal a while back. I’ve been updating it as this bull market gets older. Hopefully by my holdings you’ll notice I’ve been getting more defensive, out of high-growth tech and in broader ETFs and more defensive names. My latest moves have been into TLT, XLP, and EGPT. For me, I’m starting to get defensive for 2014, hopefully by 2015 we’ll be back to 2013 returns. My price target on the S&P 500 for the end of the year is 1,925. Assuming a pull back over the next 6 months with strength returning the end of the year. Momentum is starting to turn negative, leading to the pullback in the near-term.

2014-03-25 20_37_32-Scott (kohl_in_one) on Twitter

Current Holdings:

Ticker Price Bought
BRK/B $76.22
XLB $42.03
XLK $33.14
WDAY $106.71
AAPL $460.88
JCI $37.50
V $183.12
TCPC $15.12
EBAY $54.46
DDD $54.55
SPY $182.05
XOM $95.47
SH $25.10
XLP $42.05
TLT $108.02
EGPT $70.01

Move out of these positions over the last few months:

– Sold GDXJ – Junior Gold Miners ETF – Liked this play in the fall, and starting to like it again.  If markets stall and/or tank in the next few months (which I think is possible), I might be in this again.

– Sold DTYS – Inverse 10+ Yr. Yield – I like this play over the next 15 years, but in the short term, not going much of anywhere.

– Sold YHOO – Yahoo! – Took my nice gain and cashed it in. Also, all of Yahoo! acquisitions seem to be fruitless thus far.

 

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Revolution in Batteries and Wireless Charging


If you didn’t know that the ‘battery revolution’ was upon us, then let Tesla’s announcement of its plan to build a multi-billion dollar battery factory be your wake up call.  The lithium-ion batteries that are in our always-on  phones are now moving to cars, as movement away from non-renewable resources grows.

Although this push for longer-lasting, more efficient batteries is the next logical step in the world’s dependency on energy everywhere, 24/7. But  I think the inevitable next step after “super” batteries would be no batteries at all, via wireless charging. Let me explain a little more.

There is a company that is keeping its technology close to the vest about wireless charging, a company called uBeam (there’s not much to the site). They’re aiming to build new infrastructure and networks that work much like cell towers and cell signals work today. Except they’d be emitting a certain frequency that a special sensor in your device can detect and initiates a charging-like actions. So batteries wouldn’t necessarily go away, but you’d be less tied to your power cord and a wall.

It makes sense that they may roll out an “in-house” product first, so you can wirelessly charge items in your house (and keep them charged, even with a weaker battery). At that point, a high-end battery would be rather useless if you could essentially be “plugged into the wall” 100% of the time.

How the Tech World Turns


With Facebook buying Oculus Rift (a virtual reality startup that produces virtual reality “goggles”), it’s apparent that Zuckerberg is trying to stay ahead of the tech curve. What FB will do with Oculus remains slightly unknown, but the Oculus team has up to $300 million in incentives to hit certain milestones. I’m imagining that FB will attempt to capitalize on virtual reality as the new platform and its social and advertising revenue opportunities, while still keeping users active on PCs and on mobile.

This seems outlandish and slightly far-fetched, but after working at a tech startup for over the last year, you start to understand how quickly tech evolves. From the creation to testing to market acceptance or denial of a new technology can be a relatively short time. We at Narrative Science have been working to perfect artificial intelligence for years. The advances we’ve made have been astounding, all while getting a fair amount of press. But if people can’t use your product everyday, they assume you’ve failed. Until one day your product ends up in the hands of consumers who finally understand how they leverage your technology. My point, because people haven’t been able to use the Oculus Rift or Narrative Science for that matter, it’s easy to scrutinize the technology.

The second industrial age in upon and the rate that software is progressing is astonishing, rates we’ve never seen before. At the beginning of this second machine age, FB realizes how important it is to have a hand in the latest, possibly game-changing tech. Although people can’t see it now, FB will help bring this technology to the masses, while putting a few dollars in its pocket.

Understanding Innovation……From the History Channel


This weekend I caught an episode of “The Men Who Built America” on the History Channel. The particular episode was about Andrew Carnegie, who began the “Age of Steel”, who started the Carnegie Steel Company; ultimately minimizing production time for building-grade steel from two weeks to 15 minutes.

Certainly a better process as well as a better understanding of the chemical properties of steel helped them mass produce it, and inevitably build out of America at rates never seen before. But it wasn’t smooth sailing to convince people that steel was the next material to build better, stronger, and bigger buildings, leading to the invention of the skyscraper.

His three main hurdles:

1.) Finding a better process to manufacture high-grade steel

Lesson learned: Research and development are the keys to the next innovative breakthrough. Easy problems to answer don’t make anyone money (besider the pet rock and Flappy Bird). Hard problems to solve have the biggest payoff.

2.) Convincing railroads, construction companies, and consumers that steel was the next precedent in buildings

Lesson learned: Marketing your new idea and trying to sell it sometimes makes you feel like a mad man talking to yourself in the corner of an insane asylum. It takes much longer than you think to persuade consumers, even the early adopters, of this new view/idea. Patience and persistence prevail when you’ve done adequate research and development.

3.) Going in all in when you feel the market is “turning”

Lesson learned: Once you begin getting traction in the market, don’t be afraid to be aggressive with your spend, because it will be “now or never” to make your vision a reality.

Mind-F**k Friday – “Quantum Computing”


Computers as we know them today, ones that use processors, were being developed and slowly enhanced since the early 1900’s. Slowly, companies started commercializing machines, including the IBM’s first accounting systems, which were all punch-card based. All they could do was add, subtract, and print the results. From the ’30s to the late ’50s, this was by and large how computers were used. It was a means of doing work, but it never replaced workers. These computers were the size of rooms and required multiple workers to use the machine correctly and efficiently. Nowadays, all of that (and a little bit more), is in our pocket.

Early_SSA_accounting_operations

So what’s next after what we use today (machines driven by processors and how powerful they are)? The next level is “quantum computing”. I would recommend Googling it because it’s mind-blowing and hard to explain in a few paragraphs. So I’ll keep the explanation short to give some background, but will focus on how game-changing it will be.

Today, computers think in binary, either 1’s or 0’s (think of the Matrix). What a quantum computer can do is think  in 1’s, 0’s, or 1’s AND 0’s at any length. So instead of making one decision at a time (1 or 0), it can make potentially millions at a time. Making computers a million times faster than they are today. Kind of a mind-fuck, huh? To continue, in today’s computers, processors (think Intel) create the 1’s and 0’s via electrical impulse (think motherboards, wires, etc.). Quantum computing will send impulses through particles in the air.

Now, just like the computer that we know today took a good 50 years to develop, the quantum computer will take the same amount of time to get to the consumer. But businesses are doing initial testing (particularly Google). What they’re using it for today is machine-learning. For example, Google is trying to build a self-driving car; within in this car are programs that need to be taught the rules of the road, what a red-light looks like, etc. etc. For a computer program to get the answer correct 100% of the time takes a lot of computing power to identify unique situations, environments, etc. A quantum computer could figure it out in seconds, then Google can put that more accurate algorithm/program in your self-driving car’s arsenal.

P.S. – A company producing these today are D-Wave Systems if you’re interested.

Selling Your Data Could Be the Next Source of Income


Between the NSA, Google, and advertisers in general, the amount of your data that you give away for free is astounding. Everyone seems to be mining your data nowadays, but why aren’t you getting paid for it. (Technically you sign away your “rights” to some of your data by signing any “Terms of Service” agreement”)

I’ve always envisioned a better way to locally store all information from your interaction on a computer, instead of making that data really only accessible to services (sometimes malicious). These services take your data to try to better understand you, or people in your demographic. But if they really want to know what sites I visit, what I click on, where I look on my screen, etc., you’d ultimately have to store that information locally. Then, you could go to an “exchange”, where advertisers, etc. “bid” on your data. For example, say they’re trying to better understand 25-year-old males. My information would come up, and they could pay me $XX to know everything I’ve clicked, visited, etc. in a certain time frame.

Well, that wait might be over to start selling that data of yours. Thanks to Datacoup (https://datacoup.com/). With Datacoup, you essentially select which data you want to share (ranging from all types of social media to your checking account).  As I mentioned before, this data is worth millions, if not billions, of dollars to brands, advertisers, and data brokers. They’ll pay for access to the information that you care to share. Of course, what Datacoup is doing initially is strictly creating a better “marketplace” or “exchange” for this information. I think their next step should be some type of in-browser app that stores much of this data. Because today, if you think about it, these brands, advertisers, etc., can continue go through their traditional means of collecting your data (cookies, plug-ins, etc.). But until then, I think Datacoup has set a standard going forward for corporations to get to know more about a particular audience, instead of creating “back-doors” to access your data.

You could always “opt-out” of services that are usually inherent to programs, specifically your  web browser, by going here http://www.stopdatamining.me/.

Barring I don’t pick a perfect bracket and win  a $1 billion, this could be a nice second little income.

PS – This video of a guy who sold his data on Kickstarter, and makes some great points about selling your data and some metrics for context.