POCKETBOOK: Week Ending Oct. 13, 2018

  • IMG_6113
    Worth a look and a reminder.
  • Time to get high?

On Wednesday, October 17, Canada will legalize recreational marijuana. That’s big news for anyone who isn’t afraid of sin stocks, and, who is willing to take a chance on a growing, ever-changing, speculative and bottom line risky business.

According to a Bloomberg piece on Yahoo!Finance.com, there are 135 publicly traded pot companies in Canada. How many will be around in a year from now is anybody’s guess. My guess is that figure will be halved. And of that half, maybe 6-10 worth a look.

That said, here is a small sampling of some of the largest pot companies around in no particular order and without recommending: Tilray ( TLRY), it’s up 745% since it IPO in July; Canopy Growth Corp (CGC); Aurora Cannabis Inc. (ACBFF); Aphria Inc.; Cronos Group Inc. (CRON); and Hexo Corp. (HYYDF).

These companies, and many more,  need to be seriously and thoroughly researched before investing even a nickel-bag’s worth of your hard-earned cash into as there is much much more to each of them than meets the eye.

Bottom line: Stoners would be wise not to participate in –what could be a huge rush into the cannabis market– until they are clear-headed.

 

  • Market Quick Glance

Oh boy. If stocks continue in last week’s downward direction you can pretty much kiss this year’s profits goodbye. Particularly, if you’re an index investor.

So even though a new high was reached for the DJIA on Oct. 3, 2018, that average lost big time y-t-d performance ground when compared to its previous week’s performance.

Lower performance figures for the y-t-d figures were also true for the S&P 500 and the NASDAQ—both losing nearly half of their performance returns for 2018.

But it was the Russell 2000 that experienced the biggest hit–it’s y-t-d figure is nearly flat. Ouch.

Below are the weekly and 1-year index performance results for the four major indices—DJIA, S&P 500, NASDAQ and the Russell 2000— including the dates each reached new highs. Data is according to CNBC.com and based on prices at the close of business on Friday, Oct. 12, 2018.

DJIA 2.51% YTD way down again from previous week’s return of 6.99%.

  • 1 yr Rtn 10.94% way down again from the previous week 16.12 %

Most recent DJIA a new ALL-TIME CLOSING HIGH was reached on Oct.3, 2018 of 26,951.81. The previous high was reached on Sept. 21, 2018 of 26,796.16.

 

-S&P 500 3.50 % YTD down and about ½ of what it was re last week’s 7.93%

  • 1 yr. Rtn 8.48% way down from last week’s 13.07%

The S&P 500 reached a BRAND NEW CLOSING ALL-TIME HIGH on Sept. 21, 2018 of 2,940.91. The previous closing high was reached on August 29, 2018 of 2,916.50.

 

-NASDAQ 8.60% YTD way down from last week’s 12.82% (1/2 of what it was in late September.)

  • 1yr Rtn 13.74% way way down from last week’s 18.27% (nearly ½ of what it was in late September.)

Nasdaq reached a BRAND NEW 52-week CLOSING HIGH on August 30, 2018 of 8,1333.30. The previous high was reached on August 24, 2018 of 7,949.71.

 

-Russell 2000 0.73% YTD hugely down from last week’s 6.29% (it was over 10% two weeks ago)

  • 1yr Rtn 2.76% way way down from last week’s 7.94%

The Russell 2000 reached a BRAND NEW 52-week ALL-TIME HIGH on August 31, 2018 of 1,742.09. The previous high was reached on August 24, 2018 of 1,726.97.

 

-Mutual funds

As you no doubt expected, equity funds lost ground last week, too.

How much? Well, at the close of business on Thursday, Oct. 11,2018, the average total return for funds that fall under the U.S. Diversified Equity Funds heading was 1.13%, according to Lipper.

That’s not much to crow about and makes fixed-income, such as short-term CD investing, look pretty attractive: Little risk and short-term money lockup time always looks attractive when equity markets dive.

Other broad Lipper headings ended last week like this:

-Sector Equity Funds, -2.51%

-World Equity Funds, -9.73%

-Mixed Asset Funds, -2.11%

-Domestic L-T Fixed Income Funds, -0.80%

-World Income Funds, -4.86%.

Visit www.allaboutfunds.com for more information about how various equity and fixed-income funds have rewarded investors over the short-and long-term, based upon Lipper data. Short-term meaning weekly and monthly performance returns; longer-term includes quarterly, year-to-date, 1-yr, 2-yr, 3-yr and 5-yr returns.

 

  • Save Your Self

According to a recent CNBC.com business news story relying on data from the FDIC, the top 1 percent of earners have $113 million in their banking and retirement accounts. Their average account balances translates to $2.5 million. Oh my.

On the other hand, the bottom 20 percent of earners have an average of $8,720 saved with a median amount saved of $0.

A more specific look at wage earner savings results looks like this:

-Top 10%–average household with savings, $989,430. Median households with savings, $173,860.

-60 to 79.9%—average household with savings, $148,600. Median households with savings, $96,800.

-40 to 59.9%—average household with savings, $82,730. Median households with savings, $54,930.

-20 to 39.9%—average household with savings,$46,950. Median households with savings, $26,450.

-Bottom 20%—average household with savings, $22,600. Median households with savings, $0.

Speaking from experience, it takes a yacht load of money to live life after you’ve passed age 70. Even with an average Social Security check in the neighborhood of $1,300 a month or a plump one of over $2,000 coming in—money flies out of one’s pocketbook, savings and investment accounts faster than you can imagine.

Believe me on that one.

 

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