The MoneyShow (TMS) is a long-running collection of events, large and small, held in-person in Las Vegas, Orlando and other places, and now virtually as well since the Covid pandemic. Their events attract some of the biggest names in the industry as keynote speakers.
The larger events, such as this one, have about a hundred sessions and speakers, dozens of exhibitors, and hundreds of attendees. Nancy Zambell, Chief Analyst of the Cabot Money Club, has had a long relationship with TMS and a number of our analysts have spoken at their conference over the years.
Cabot has always promoted learning as an important value, and conferences like this are a great way to get exposed to lots of investing ideas as it really is a bazaar where you can find almost anything to do with investing.
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The sessions skewed somewhat away from what I would call core investing topics – growth, value, dividend and fixed-income investing or ETFs – and more towards less common strategies. That’s not surprising really. People are more familiar with those core topics and there may be less that’s new to say about them. But it’s important to remember that they are core investing strategies for a reason.
A few thoughts from the conference:
Crypto: Notably, there was very little talk about crypto. Probably enough said about that.
Fixed-Income: There was discussion of fixed-income investing (think bonds), which has come back into play after more than a decade of being almost irrelevant for most investors. Yields on bonds have gotten respectable again and can be part of a diversified portfolio.
Options: The use of options trading as a way to hedge and to generate growth and yield was also discussed by a number of speakers. The volatility of the market over the past 15+ months has made investing more challenging but created opportunities for savvy options traders to make money. (Cabot’s Andy Crowder, Chief Analyst of Cabot Options Institute Fundamentals has had very good success in this market).
Index Funds vs. Stock Picking: The soft market since early 2022 has generally beaten up on index funds, particularly of smaller companies. But there are always opportunities for stock pickers, using solid research and fundamental and technical analysis, to find profitable stocks, even if the time frames may be slightly less predictable.
Optimism vs. Pessimism: People love to talk doom and gloom. I was surprised by the level of pessimism I heard from people at the podium. I’m not being Pollyanna about things. The U.S. economy, like most around the world, is not perfect right now.
At the same time, inflation has moderated, gas prices have returned to earth, and unemployment is historically low. Yes, making money in the stock market isn’t as easy right now. But, history has repeatedly favored the optimist. In fact, these are the markets where fortunes can be made as stock prices are down, as long as you’re careful and well-informed.
Politics & Investing: Investing opportunity is not highly correlated to partisan politics. So it is a surprise to me that so many investing experts like to push their partisan politics, suggesting it is relevant to investors. It simply isn’t.
At an investing conference, it is typical to find more financial conservatives and that appeared to be the case here as a number of speakers felt the need to talk about what a great President Ronald Reagan was or how problematic Democratic administrations are.
Whether you loved or hated Reagan and his policies the numbers just don’t bear out that he or the Republicans are better for our economy or investors than Democrats. (Actually, the stock market performs about 5% better during Democrat than Republican administrations, and the deficits grow more under Republican administrations too.)
I advise you to compartmentalize your partisan politics and your investing because they have surprisingly little to do with each other. That’s why you don’t hear Cabot analysts wading into politics. If you want that coverage, there are plenty of publications and pundits right, left and center. If you want solid investing research, insights and recommendations, Cabot has you covered.
Artwork & Collectibles: One company represented at the conference was selling sculptures as a hard-asset investment. I won’t spend much time on them but suffice it to say, buy artwork because the aesthetics give you pleasure. Some, small portion of artwork will appreciate in value.
In the same category, I’d include mass-produced commemorative collectibles like non-currency coins, plaques, spoons, etc., even when they’re limited, numbered editions. Most won’t produce a profit, or even hold their value.
And by the way, I didn’t see a single mention of NFTs (non-fungible tokens) that were so hot a year or two ago and being pitched as collectible investments. The bubble has clearly burst on NFTs.
Precious Metals: These can have their place in a well-diversified portfolio as a place to park a small portion of your assets as a hedge, particularly in some market conditions. I’m not a financial advisor but I’m generally thinking low single-digit percentages. It’s rare for precious metals to outperform the market over time though so I would caution against over-buying.
Elliott Wave Theory: Wave followers fall into this category for me. The Elliott Wave (TES) theory was developed by Ralph Elliott in the late ’30s and in short, it identifies patterns of 5 ups and 3 downs they say happen in a predictable pattern, although the size of the ups and downs can vary widely, and the period between is unspecified. Proponents swear by it, but skeptics think it’s a classic case of retrofitting a theory after the fact.
And, by the way, there’s a word for that — Pareidolia — which is the tendency for humans to impose a meaningful interpretation on a nebulous data set, usually visual, so that one sees an object, pattern, or meaning where there is none. Count me among the skeptics. If it was as perfect a crystal ball as its adherents claim, why aren’t they all retired, living fabulously on their private yachts?
Private Placements: There were oil and mineral exploration companies and biotech startups looking for funds from investors. This is a very high-risk area of investing that I would recommend most investors avoid. While a win can produce a huge payoff, most of these are highly speculative, low-probability-of-success ventures best left to the pros who can more thoroughly research investments and can also withstand the inevitable losses.
These are just a handful of the investing ideas that were discussed during my time at the conference, but the most important idea is to stay optimistic and keep learning and refining your investing strategy over time.
Were you at the conference, or have you attended in the past? What did you think of it?
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