The four risks that could blow up your portfolio

Hundreds of investing and finance newsletters hit my (and maybe your) inbox every week. This is the best of the best.

This week, we bring you

  1. Great news about American wealth
  2. Five tax breaks for paying your student loan
  3. Seven things you need to know about the largest wealth transfer in history
  4. What are the world’s fastest-growing economies?
  5. The four intersecting risks that may hit the global economy

Our most popular story last week was from ​The AverageJoe​

At Alts, we’re so into investing in music rights that we’ve written not one but two different guides to how it works.

  1. ​​Investing in Music Rights and Song Royalties​​
  2. ​​Buying music rights: A deeper dive​​

It’s more complicated than this, but when you own the rights to a song, you get a few cents every time it’s played. If it’s a popular song, that can add up quickly. So investors will pay hundreds of millions for the rights to an artist’s entire catalog, aiming to earn a 5% to 15% perpetuity.

​​Loads​​ of musicians, including Bruce Springsteen, Katy Perry, ZZ Top, Motley Crue, Bob Dylan, and Whitney Houston, are cashing in their catalogs for a big payday.

The best stuff is usually expensive (and out of reach for most of us), which is why I was interested to see ​​Public offering the rights to Shrek the other day​​.

[Disclosure: I requested an allocation.]

They’ve acquired the rights to the music from all four films and the related TV specials. That’s generated around $83k over the last twelve months for an ROI of 8.5%.

I like money

This feels like a more interesting and possibly profitable alternative to the 5.5% treasuries everyone is buying right now.

The risk is that people will stop watching Shrek films and stop going on the rides, but perhaps surprisingly, search volume for the green ogre is actually increasing year over year.

Don’t underestimate the staggering drawing power of Shrek

​Check out the offer if you’d like.​

It’s only available to Americans, unfortunately.*

Great news about American wealth

via ​Noahpinion​

Noah Smith published a ​counterargument to the growing conventional wisdom​ that the American consumer is in deep trouble.

The data is from 2022, which is why I think he’s wrong, but it’s a good counterbalance to the zeitgeist.

​Read his piece​ if you want to feel better.

​Subscribe to Noahpinion​

Five tax breaks for paying your student loan

via ​Sidepiece​

Student loan payments are back, and a lot of Americans will struggle to pay them off. This week, ​Sidepiece​ ​shows​ us how to ​apply for tax breaks to help offset the burden​.

​Subscribe to Sidepiece​

Seven things you need to know about the largest wealth transfer in history

via ​SMB Deal Hunter​

Baby boomers are retiring, and many of them own small businesses. Many of those have no plan in place for what to do when they retire.

​SMB Deal Hunter​ ​pointed​ us to a super comprehensive thread to take advantage of this dynamic.

​Subscribe to SMB Deal Hunter​

What are the world’s fastest-growing economies?

via ​The AverageJoe​

Most of the world’s ​fastest-growing economies​ aren’t exactly household names, with seven of the top ten in Africa and the top three spread between Southeast Asia and South America.

​The AverageJoe​ shares the ​surprising reasons​ why Macao and Guyana are doing so well.

​Subscribe to The AverageJoe​

The four intersecting risks that may hit the global economy

via ​Short Squeez​

Illustration of a Newton's Cradle featuring multiple earths and the Capitol dome

AKA, how geopolitics is going to f*ck you.

​Short Squeez​ ​points​ us to a terrifying ​Axios article​ tying together four seemingly unrelated things that could combine to set the world (and your portfolio) on fire.

​Subscribe to Short Squeez​

📚 What I’m Reading

Everyone always asks how I stay up-to-date, so here are a few of my favorite newsletters. Click on the links to subscribe (all free):

​The Informationist​

The Informationist simplifies one economic concept every week. Lightweight and high value per minute spent.

​Sandhill Report​

A fantastic source of pre-IPO startups, news, and exclusive access to private startup auctions.

​Equity Espresso​

Aussie-focussed market news that gives a solid non-US perspective on global finance.

🧠 Stock ideas

This week, we’ve got three reasonably mainstream (no penny stocks) high-dividend-paying ideas for you. I found them using the ​stock screener​ at Public.com.

Remember to always DYOR.

Vodafone Group ($VOD)

Bull Case:

  • The prospective merger between Vodafone and CK Hutchison’s Three UK unit, valued at £15 billion, is poised to bolster the 5G infrastructure in the UK, potentially enhancing consumer experiences and driving revenues.
  • Strategic partnership with Amazon’s Project Kuiper aims at extending the reach of Vodafone’s 4G and 5G networks in Europe, indicating an innovative approach to expanding connectivity and possibly increasing market share.

Bear Case:

  • Despite some promising moves, Vodafone’s share price has significantly declined in 2023, which may reflect underlying concerns about the company’s financial health or competitive position.
  • The stock’s volatility is lower than other UK stocks, which might be seen as a lack of dynamic price movement or investor interest, possibly indicating a bearish sentiment​1​.

Full analysis

Stellantis N.V. (​$STLA​)

Bull Case:

  • Stellantis invests in its workforce by offering share plans to 87,000 workers in France and Italy, which may enhance employee loyalty and productivity.
  • Significant expansion in battery capacity to 400 GWh to support growing electric vehicle (EV) production, demonstrating a strong commitment to the EV market.
  • The share price has risen by over 25% in 2023, indicating positive market sentiment and financial performance.

Bear Case:

  • Despite overall growth, the increase in the number of shares outstanding by 54.76% within a year could potentially dilute earnings per share, which might concern investors.

Full analysis

NatWest Group plc (​$NWG)​

Bull Case:

  • Strong Q3 2023 performance with an attributable profit of £866 million and a robust return on tangible equity (RoTE) of 14.7%, indicating solid financial health and effective management.
  • Historically, NatWest has demonstrated relative growth in share price, signifying potential for future appreciation.

Bear Case:

  • The bank has recently downgraded its profit outlook due to tighter competition for savers.’

Full analysis

That’s it for this week.

If you write amazing content and would like to be featured, please send it through for consideration.

Cheers,

Wyatt

Disclosures

  • There are affiliate links above; we’ll get a couple of bucks if you take action after you click through.
  • I don’t hold positions in any of the investments above.
  • Nothing above is financial advice. DYOR, you filthy animal.

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Author

Wyatt Cavalier

Wyatt Cavalier

With a background in finance & intelligence analysis, Wyatt has an unhealthy obsession with finding the best blue chip investment opportunities. His previous newsletter, Fractional, resonated deeply with subscribers, bringing actionable insights and unconventional trading strategies. His rare book collection specializes in banned editions. He currently lives in Spain with his beautiful wife, three young boys, and dog Monty.

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