Jakub Rochlitz @TheDividendFund: "𝗪𝗲𝗲𝗸𝗹𝘆 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗨𝗽𝗱𝗮𝘁𝗲 - 𝟭...."

Slovakia

𝗪𝗲𝗲𝗸𝗹𝘆 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗨𝗽𝗱𝗮𝘁𝗲 - 𝟭. 𝗗𝗲𝗰𝗲𝗺𝗯𝗲𝗿 𝟮𝟬𝟮𝟱 We are entering the last month of the year on pretty strong footing. The volatile November period seems to be behind us now. The VIX market volatility index fell 30% back to more normal levels, and the market panic index is slowly emerging from the territory of maximum panic. However, it was not without casualties. Look at my latest portfolio analysis here: bullaware.com/etoro/TheDividendFund $NVDA (NVIDIA Corporation) lost 12% in November, $META (Meta Platforms Inc) is still 14% down from the end of October, and $AMZN (Amazon.com Inc) and $MSFT (Microsoft) are both down 5%. This has been a slight drag on the portfolio. We kept balance, however, thanks to our diversified approach. We are seeing a clear change in market trends. Given the negative news, such as Michael Burry's bearish views, market volatility, and negative comments from some important investors, capital is clearly flowing away from growth companies to value companies. This is not surprising. However, market conditions are still bullish. We are facing interest rate cuts, a relatively stable economy, and improving geopolitical conditions. All of this is positive for stock market growth. But investors are asking why they should risk the high valuations of technology companies when they can also make money on good old Walmart and Coca-Cola. We'll get into that at the end. 𝗔𝗜 𝗖𝗵𝗶𝗽 𝗗𝗲𝗽𝗿𝗲𝗰𝗶𝗮𝘁𝗶𝗼𝗻 There has been a lot of talk about the looming issue of chip and data center depreciation schedules at big hyperscalers not being in sync with reality. Michael Burry, on his Substack here ( michaeljburry.substack.com/ ), made a very powerful argument for it. From my point of view, this is just a different way to say that sooner or later, hyperscalers will end up with loads of chips that they won't need. And I've known that for a long time. However, the depreciation issue could potentially rattle the prices of these stocks when the day comes, which is another powerful argument for reducing our exposure. --- 👉 I’m Jakub Rochlitz, certified investment manager and market analyst, beating the market year after year. Copy my portfolio today and join over 1600 investors! --- I will post my own analysis of the topic soon, but for now, here's how I'm adjusting the portfolio. Over the past weeks, I reduced some of our tech & AI holdings like so: $AMZN - 7,6% -> 5,3% $MSFT - 6,5% -> 5% $GOOG (Alphabet) - 9% -> 6% $VST (Vistra Corp) - 7,2% -> 6% $GEV (GE Vernova LLC) - 5,6% -> 2,4% Like I said, I believe the current market conditions are positive for the broad stock market, and opportunities are arising outside the tech & AI space, which is a great time to diversify. 𝗣𝗲𝗮𝗰𝗲 𝗗𝗲𝗮𝗹 𝗧𝗮𝗹𝗸𝘀 This week, the Ukraine peace deal talks are expected to continue, which is likely to have an impact on our position in $RHM.DE (Rheinmetall AG) . This volatility was expected, and is precisely the reason why we hold a smaller position in Rheinmetall, currently at 5,5%. At the current valuation, Rheinmetall is much more fairly valued, and I don't expect a potential peace to significantly impact the long-term growth thesis. Of course, I would be very happy if a peace deal were reached. For a deeper look at Rheinmetall, check out my analysis on eToro's blog here: www.etoro.com/news-and-analysis/in-depth-analysis/rheinmetall-strong-momentum-but-limited-upside/ 𝗠𝗮𝗿𝗸𝗲𝘁 𝗕𝗿𝗲𝗮𝗱𝘁𝗵 𝗮𝗻𝗱 𝗥𝗮𝘁𝗲 𝗖𝘂𝘁𝘀 Stocks recovered much of their November losses thanks to rising odds of a December rate cut. Wall Street now projects ( www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html ) an 87% chance of the Fed cutting by 25 basis points. Falling interest rates will provide a tailwind for stocks going into the new year, especially in value stocks and rate sensitive sectors. Our positions in $LEN (Lennar Corp) and $DHI (D.R. Horton Inc) performed very well in the past week or so, and I expect to add to them as a bet on further cuts and a revival of US housing market dynamics. The broadening rally is also creating good conditions for diversifying the portfolio, and I expect to include more assets from my watchlist over the coming days. I wish you all a successful week. 𝗙𝗲𝗲𝗹 𝗳𝗿𝗲𝗲 𝘁𝗼 𝗮𝘀𝗸 𝗺𝗲 𝗮𝗻𝘆𝘁𝗵𝗶𝗻𝗴!