Stock Market Pushing Higher
S&P 500 tests 4,000 for the 1st time
The Beginner’s Edge A Monthly Digest
Step Into Stocks!
“The Stock Market really isn’t a gamble. As long as you buy good companies that you think will do well and not just because of the stock price.” Peter Lynch
by Alex Cunningham on March 31
Welcome to the Market Adventures monthly newsletter! I’m glad you’re here and even more excited that you’ve taken an interest in the stock market. Being the first issue of this publication, let me just start with this disclaimer and we’ll jump right into the fun.
“This newsletter and all related Market Adventures content is not investing advice. Everything you are about to read is merely the opinion of the writer. Please seek the counsel of a financial advisor prior to making any investment decisions. Though the stock market does present many opportunities to make money, there are an infinite number of ways to lose all or more than your original investment. That being said. Don’t invest or trade in any security mentioned in this publication or its related content.” Now that that’s out of the way...
Always Start With
The Broader Market | S&P 500
The Trend Is Your Friend
A popular saying on the street and one I’ve noticed has a lot of weight to it. Though stocks can often move on their own for a number of reasons, there is a general respect among all securities for broader market sentiment. At the end of this March, we saw the S&P test 4,000 points and retreat away from it, forming a resistance level above the market. March volume was higher relative to recent months which revealed profit taking in tech and other Covid winners and rotation into cyclical stocks and the reopening trade. Still, the general market looks to continue trending upwards as the economy gets back in gear.
Important To Keep An Eye On
US Fed interest rates and bond yields. That was the story for much of March. How the Federal Reserve plans to respond to inflation now that the economy is reopening and doing rather well according to the economic indicators. Listen to why interest rates matter here.
Stick To Your Money Management Rules
Proper Money Management: #1 Ingredient To Financial Freedom
Have you set your goals? Targets? Maximum risks? These are just a few of the self-rules you should have for yourself if your desire is to increase your value and capacity to earn more money.
Start With a Digital Wallet: Digit
Great financial success starts with 2 skills, goal setting and saving. Get Digit. The One app for all your goals. Digit helps you save, invest, pay off debt, and prevent overdrafts. With Digit guiding money to your goals each day, you’ll reach them faster and feel at peace along the way. You will get $5 free to get your savings started.
Let’s Look At
Stocks To Watch | Swing Trading
Conservative Monthly Goal: 5% Move In Stock Price
Scale in 1/3rd lots, buying on the way up.
Bull market. Let it run unless there is a technical or major fundamental reason to reduce position.
2% loss rule, don’t lose more than 2% of the entire portfolio balance on any one trade
Easiest Way to Build A Small Account
Wait For the Set Up
5% target: $129 | Range target $138
Need RSI to break above par (50)
5% target: $119 | If gap filled, then: $123, $131
Need RSI to break above par
Beyond Meat ($BYND)
5% target: $137 | Real target $160
Need a bullish signal on the daily
5% target: $55 | Next target $63
Featured Episode: How To Build Your Stock Portfolio | Value vs Growth stocks
This is an oldie but a goodie. New investors should really focus heavily on building their nest egg before swing trading and options trading. Though not nearly as fun, you’ll thank yourself 3-6 months from now when you look back at that decision. This episode helps give you a surface level idea of a few variables to look at when building a long-term stock portfolio.
This Month’s Long-term Stock Pick
Key Trends (sourced from Td Ameritrade):
International expansion fueling growth
Most of the new restaurants the company plans to open are in China/Asia Pacific. The number of Starbucks outlets in these countries are still much less than the number in the U.S. New outlets opened will be a mix of company-operated and franchised restaurants. SBUX remains on track to add 600 net new stores per year and to achieve its goal of 6,000 stores in 230 cities across Mainland China by the end of fiscal 2022.
Focus On Drive-Thrus
SBUX intends to open a majority of its new U.S. restaurants in middle America and the south, with over 80% of stores built in the year being drive-thrus. The company states that their research has indicated significant opportunities for store expansion in higher growth, lower cost markets, particularly when considering rising wages and occupancy costs. The company also took a decision to close 400 stores in North America over the next 18 months and accelerate their plans to open 300 new locations focused on takeaway and delivery.
Deal With Nestle
Starbucks and Nestle announced plans for a $7.2 billion license deal that would allow the latter to market, sell, and distribute the coffee giant's brands in Consumer Packaged Goods (CPG) and Foodservice. This global coffee alliance, which brings together the world's leading coffee brand and retailer, and the biggest food and beverage company globally, gives Nestle a stronger footing in its fight against JAB Holdings, the world's second largest player in the coffee space. For Starbucks, on the other hand, this deal paves the way for expansion into markets where the company has no CPG presence. Starbucks will also be supplying the coffee to both the Nespresso and Dulce Gusto machine platforms, opening its access to the addressable, single-serve coffee market.
My Current Long-Term Holdings:
$T, $AGNC, $XRX, $IRM, $WFC, $MO, $ABBV, $XLE, $PFE, $O, $HBI, $INTC, $KO
Miami, FL, 33169