RadimGoth @RadimGoth: "What's new in our portfolio..."

Czech Republic

Edited

What's new in our portfolio and the stock market in general? 1. President Emmanuel Macron recently announced the dissolution of the National Assembly and called for parliamentary elections that brought nervosity to the Paris stock exchange and dragged down our $VIE.PA (Veolia Environnement S.A.) by 5%. The far-right parties in France want to cut taxes for poorer citizens and lower the retirement age. Many economists think that this can lead to a debt crisis and in turn, higher taxes for businesses. The far-right parties have protectionism in common. Therefore, they will try to protect domestic companies and focus on the taxation of multinationals, which is good in our case. How I see it - if Macron's party wins, the stock market will quickly fill the gap and continue on previous valuations. If he loses, we can see some turbulence and lower multiples at the end. However, the Earth will keep spinning and Veolia will keep generating profits. 2. If you own a bank, you don't need to worry about foreign countries sending troops in helicopters to steal your money. Your country has an army that provides you with security. But when we talk about cybersecurity, nobody protects you or your bank. The bank has to protect itself at its own expense and must do it well to comply with regulations. NIS2 is the European Union’s revised Network and Information Security Directive. A comprehensive cybersecurity regulation aimed at bolstering the resilience of critical entities and essential services across the EU. The member states have to finish its implementation by October 2024. The situation is somehow similar to GDPR, but the difference is, that GDPR was about handling personal data affecting almost every organization but is easier to understand. The NIS2, is about cybersecurity but targeting just some entities. The problem is that it is far more complicated than GDPR and some companies even don't know if they must be compliant or not. And for some of those who must be compliant, it will be pretty challenging. This plays well with $QLYS (Qualys Inc.) which provides best-in-class compliance tools. In fact, Qualys provides comprehensive cybersecurity solutions and I believe that many companies will buy their compliance solution and Qualys will be able to use it as an opportunity to upsell. 3. The $01211.HK (BYD Co Ltd) is a huge winner because it will get lower tariffs. One of the factors was their cooperation with the EU. 4. What is my focus right now? I am actively looking into $LC (LendingClub Corporation) which recently proved that their loan portfolio is in good shape. I am still accessing the risk which seems to be asymmetric - they can be huge winners when the FED lowers the yields, but they can also do well if the yields stay elevated.

4 Mentioned

VIE.PA

Veolia Environnement S.A.

QLYS

Qualys Inc.

01211.HK

BYD Co Ltd

LendingClub Corporation