Matej Kranjc @ReturnInvest: "Hello everyone and welcome to..."

Slovenia

Hello everyone and welcome to the new copiers. In the July update, I go over the current market conditions and the recent FED speech, Q2 earnings so far, one change I made to the portfolio, as well as possible future changes. 𝙈𝘼𝙍𝙆𝙀𝙏 𝘾𝙊𝙉𝘿𝙄𝙏𝙄𝙊𝙉𝙎 FED Chair Jerome Powell held a press conference on July 30th. Most people were anticipating that he would hold rates steady and lay out a plan to start cutting rates during one of the upcoming meetings in 2025. On the contrary, Powell said they might not cut rates at all this year. There also appears to be some political tension between Trump and Powell. Powell wants to keep the FED independent, which he believes is crucial for American economic stability. Trump, on the other hand, wants Powell to cut rates to boost the economy in the short term—potentially ignoring the risk of triggering another wave of inflation. Powell also mentioned that job data has not shown significant weakness so far, and that tariffs will take time to show up in inflation data. There is speculation that the FED might have had an early look at Friday's job report, which could explain their stance on not cutting rates—suggesting that the labor market remains strong. Powell has a tough job right now, with conflicting pressures: 𝙊𝙫𝙚𝙧𝙝𝙚𝙖𝙩𝙞𝙣𝙜 𝙛𝙤𝙧𝙘𝙚𝙨: tariffs, sticky inflation, AI-induced growth, and still-strong labor data. 𝘾𝙤𝙤𝙡𝙞𝙣𝙜 𝙛𝙤𝙧𝙘𝙚𝙨: high interest rates and the potential wave of AI-related job cuts that could push the economy into recession. 𝙎𝙇𝙑 𝘽𝙐𝙔 I added a reasonably sized position (2.94% portfolio weight) in a silver ETF. In my opinion, silver remains one of the few assets that don't seem bubblish yet. Another reason for adding it is due to "Big Beautiful Bill" further increasing the U.S. debt, which may lead me to reconsider the bonds I currently hold and possibly partially replace them with precious metals. These are, ideally, politics-free and hopefully will remain that way (although that hasn’t always been the case, such as during the gold confiscation when the dollar was depegged from the gold standard). I also see this as a play similar to BTC - offering safety, potential profit, and diversification. 𝙈𝙀𝙏𝘼 𝙀𝘼𝙍𝙉𝙄𝙉𝙂𝙎 Meta reported a very strong quarter, with EPS of $7.14 vs. $5.92 expected. On the revenue side, they beat expectations with $47.52 billion vs. $44.80 billion. They also provided Q3 guidance above Wall Street's estimate of $46.14 billion, forecasting between $47.5 to $50.5 billion. They continue to bet big on AI, with some major acquisitions this year, including Scale AI. 𝙈𝙄𝘾𝙍𝙊𝙎𝙊𝙁𝙏 𝙀𝘼𝙍𝙉𝙄𝙉𝙂𝙎 Microsoft beat expectations with EPS of $3.65 vs. $3.37, and revenue of $76.44 billion vs. $73.81 billion expected. As a result, Microsoft’s share price jumped, and it became the second company to surpass a $4 trillion market cap. Year-over-year revenue growth of 18% from Q2 2024 to Q2 2025 is the fastest in three years for Microsoft. Azure remains the biggest growth driver. 𝙂𝙊𝙊𝙂𝙇𝙀 𝙀𝘼𝙍𝙉𝙄𝙉𝙂𝙎 Google also beat expectations, with a 14% year-over-year revenue increase. Revenue came in at $96.43 billion vs. $94 billion expected, and EPS at $2.31 vs. $2.18. I’ve decided to hold onto their shares a bit longer and will monitor their progress. Google trades at a much cheaper valuation compared to other big tech stocks, which stopped me from closing the position. I also believe they still have more to show in terms of AI development. It seems that expectations for Google’s earnings were lower than for some of the other high-flying stocks. 𝙋𝘼𝙔𝙋𝘼𝙇 𝙀𝘼𝙍𝙉𝙄𝙉𝙂𝙎 PYPL beat on both revenue and EPS, reporting $1.40 EPS vs. $1.30 expected, and $8.29 billion revenue vs. $8.08 billion expected. They also raised full-year adjusted EPS guidance to $5.15–$5.30, up from the previous range of $4.95–$5.10. Despite this and its already veary cheap valuation, the stock was heavily punished after earnings due to a slowdown in branded checkout growth to 5%, vs. 6% expected - likely due to tariff pressures. 𝙁𝙐𝙏𝙐𝙍𝙀 Depending on upcoming job reports - and especially if there are discounts during the temporary tariff de-escalation - I’ll be looking to pick up more silver, possibly BTC, or even gold. I trust these assets the most during politically uncertain times, as they have historically preserved value. I may trim some existing positions. Palantir could be one candidate, as I believe the current price is being propped up by extreme greed. In my opinion, even shockingly good earnings wouldn’t justify the current price action - but who knows, I’ve been wrong before. Most recently, I was wrong about Tesla. I sold it thinking there was no way the share price could stay this high given their upcomming numbers. In hindsight, I still believe it was the right call - they’ve been struggling quarter after quarter for nearly two years now although somehow share price keeps going up.

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