“We’ve all been told a lie about the nature of creativity.”
- Allen Gannett
Is your #process and/or portfolio creative, objective, and evolving? Or are you easily offended and unable to deal with opposing opinions? The former gets you $3.4 BILLION raised in the SNOW IPO today. The latter makes you a snowflake.
The aforementioned quote comes from a creative author (and Macro Show @HedgeyeTV subscriber!) who was kind enough to send me his book this summer. He called it The Creativity Curve – How To Develop The Right Idea At The Right time.
Gannett goes on to introduce the book by pointing out that “for as long as anyone can remember, our culture has perpetuated the myth that creative success is the result of a sudden light-bulb moment.” Newsflash: it’s not. It’s a bloody grind.
Back to the Global Macro Grind…
Newsflash Part Deux: 13 years ago, I knew building something called Hedgeye was going to offend some people. I also knew that it had the real potential to challenge and inspire many more people.
The latter is why I do this.
Yep, if you subscribe to it, you have to deal with me being as flawed as any other human being you’re going to find in this profession. Consider the alternative, reading lazy, process-less, and conflict of interest ridden Old Wall research every day.
So, thank you, Allen Gannett (and all of you who enjoy following my teammates and I), for inspiring me this morning.
For some, the offensive part about Hedgeye’s creative destruction is that we quite literally show you all of the components of what I think makes for a world class, data-driven, hedge fund. If you looked inside other hedge funds, what would you see?
Why does that offend a few and inspire the many? Think about it.
A daily content platform that’s built to not only generate “the right ideas”, but the right timing on the risk management of those ideas isn’t easy to replicate. It’s a lot easier to collaborate with us than to complain.
Hedgies who run “net neutral” (on market exposure) need ideas, lots of Single Stock Ideas. We create and sell those, as a service.
Consider the following Long/Short pair by Hedgeye Partner and Industrials guru, Jay Van Sciver:
A) Long Fedex (FDX) vs.
B) Short Nikola (NKLA)
One of these stocks has real trucks that see margin expansion during #Quad3 #InflationAccelerating. The other stock has pretend trucks that have no revenues or margins. That’ll be a great pair trade to have on today.
Other Hedgies who run Macro Long/Short need Asset Allocation and Sector Style Ideas. We create and sell those as a service too:
A) #Quad3 = Long REITS (XLRE) +1.3% yesterday
B) #Quad3 = Short Financials (XLF) down -1.4% yesterday
Cool. The best part about that long/short pair is that if the probability continues to rise that the US economy goes from #Quad3 to #Quad4 in Q4, you just stay short the Financials (XLF) and Long Gold, REITS, etc. - no changes needed to those parts of the portfolio.
This Hedgie sometimes runs net neutral, sometimes really net long, and sometimes really net short.
It took me 20 years and counting to build a Go-Anywhere Macro (Asset Classes, Sectors, etc.) to Micro (Stahks!) long/short strategy that A) preserves & protects my hard earned capital and B) allows others to build/run their own hedge funds alongside me.
While others are just smarter than I’ll ever be and can do everything we do with far fewer people and less transparency, that is of no concern to my vision of Hedgeye’s future.
As we work alongside our subscribers and challenge one another, we generate more ideas, faster. My sincere thank you to all of you who get it and are part of our Creative Growth Accelerating team.
Immediate-term @Hedgeye Risk Range with TREND signal in brackets:
UST 10yr Yield 0.61-0.73% (bearish)
SPX 3 (bearish)
RUT 1 (bearish)
NASDAQ 10,496-11,311 (neutral)
REITS (XLRE) 35.24-37.40 (bullish)
Financials (XLF) 24.24-25.53 (bearish)
VIX 24.99-33.79 (bullish)
USD 92.37-93.80 (bearish)
Oil (WTI) 35.02-40.32 (bearish)
Gold 1 (bullish)
Silver 26.16-28.23 (bullish)
Copper 2.97-3.09 (bullish)
MSFT 193-214 (neutral)
AAPL 104-119 (neutral)
Best of luck out there today,
KM
Keith R. McCullough
Chief Executive Officer
