Lună: iunie 2014

Building a Biotech long term portfolio

I am currently reading Ray Kurzweil’s book The Singularity Is Near and I was shocked to read a few days ago that his 2005 prediction that in 10 years (by 2015) we’ll produce age reversal in mice was accomplished in 6-9 years: see here and here, with initial human clinic trials expected in 3-5 years.

The book, whose main theme is the „law of accelerating returns”, is full of ideas that were being researched in 2005 that are about to „explode” into the world. Some of the most interesting of them are in biotech/genes, among others in nanotechnology, robotics and AI.

As the population in the developed world is ageing, I believe the addressable market of biotech innovations will continue to grow. So I become interested to build a long term portfolio in this sector.

As I am not qualified and prepared to research, handpick and actively manage a portfolio of individual stocks, I started to look for an ETF that will offer me exposure to biotech without the pressure of daily managing it.

And this is what I found:

BIBProShares ETFs: Ultra Nasdaq Biotechnology – Overview.

It is a leveraged ETF that aims to duplicate and compound daily twice (200%) the performance of the underlying index (the Nasdaq Biotech Index NBI).

Alternatives considered were PBE, XBI, IBB – but they did not offer leverage. However I am not very happy with the compounding of daily results of BIB, which means that in times of significant volatility I may lose money even when the index is growing slowly. But I chose the leverage in the end, so I selected BIB.

I just placed an order to buy a first tranche today, for a price of around 88$. My plan is to hold it for as long as this market is still in party mode, add another tranche or two in weakness periods, sell a tranche or two if the price goes up significantly by the end of the year, but re-invest after corrections so I will continue to have exposure to biotech for the next 5-10 years.

Traiasca BIB-ul si afacerile lui BIB-u :)

Yellen forecasts a slow rise in interest rates – The Fed

Yellen forecasts a slow rise in interest rates – The Fed – MarketWatch.

Optimistic outlook for the next year, with QE gradually decreasing until the end of 2014 and the interest rates set to grow slowly starting mid-2015.

I expect the party mode on Wall Street to continue for the next few months, pushing indices to new all-time records, possibly followed by an excess phase that will bring a significant correction at the end of the year/beginning of 2015. But for now, risk on.

The Capitalist’s Dilemma – Harvard Business Review

The Capitalist’s Dilemma – Harvard Business Review.

amazing intellectual feast from Clay Christensen & co.

Apple stands out here as the company who (used to?) resolve the dilemma by always having a great innovation in the labs, despite hoarding cash like no other company in the world. We’ll see in the following months if they still „think different” from corporate USA and deploy cash to market-creating innovations, or just to performance-enhancing and efficiency innovations.

Apple – Apple Events – Special Event June 2014

Apple – Apple Events – Special Event June 2014.

Asa cum ma asteptam, numai anunturi soft: Imbunatatiri masive de design si continut la OS X si iOS, iCloud Drive pt toate documentele si pozele, HomeKit pentru controlul casei si HealthKit pentru sanatate, integrat cu o multime de doctori si clinici din SUA, mesajele includ acum voce (gen walkie talkie), Siri asculta mereu si poti sa ii zici “Hey Siri…” fara sa atingi telefonul, apelurile si SMS-urile sunt redirectate pe toate device-urile (inclusiv Mac!), pozele se editeaza splendid, totul se imparte in familie si intre toate device-urile, aplicatiile se pot folosi una de alta si extinde sistemul, apar widgets etc. etc. Pt developeri, Apple a inventat un nou limbaj de programare simplist si da acces direct la puterea de calcul si desen din cip-urile A7, pentru performante de pana la 10x mai mari. iOS 8 si OS X Yosemite vin in toamna, cu beta disponibile imediat. 

Absolut nimic nou hardware. Raman toate pentru la toamna. AAPL -1%, rezonabil deocamdata, si probabil ca va merge sideways pana la toamna (daca nu intra in Dow Jones Industrial Average imediat dupa split).

Una peste alta, sunt foarte impresionat de noile softuri, cu care Apple dovedeste din nou ca e in competitie doar cu ea insusi acolo sus deasupra tuturor.