Welcome to Saturday, friends. I’m Phil Rosen, writing to you from New York City.
I’m excited to share this week’s conversation with a top strategist and her outlook for 2023 — but first I have a question for you.
Who should I interview next? Let me know on Twitter @philrosenn, or email me [email protected].
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Steph Guild is the head of investment strategy at Robinhood. This conversation has been lightly edited for length and clarity.
Phil Rosen: How have retail investors on Robinhood changed their investing habits now compared to 2022?
Steph Guild: Our customer base understands better now that investing is more of a longer-term game, rather than something fun.
Whereas a year ago customers opened accounts and just bought a couple stocks they felt were cool, now there’s more recognition that you can’t just bet on one or two horses, but you need to have a mix.
As the economy faces more risks like a recession and a potential credit crunch, do you think retail investors will change their strategy?
SG: I want to say no, simply because last year was a much bigger hit, and if we take our Robinhood Investor Index as an estimation of what our customers are invested in, that didn’t materially change.
And that was actually a worse environment for what they’re holding. And they barely sold anything.
I feel like they’ve weathered quite a bit of a storm based on the things they hold already. So I’m not sure that this is going to materially change their investments.
Read the full conversation with Robinhood’s top investment strategist.
What do you think of Guild’s insights on retail investors? Let me know.
1. The chief economist at Zillow said short-term real-estate investing tactics won’t work anymore. Approaches such as house-flipping are a thing of the past, Skylar Olsen said, and the favorable conditions of the early pandemic aren’t coming back. Your best bet now is taking a long-term view that’s designed to generate cash flow.
2. JPMorgan chief executive Jamie Dimon said recession risks have ramped up. In an interview with CNN, the Wall Street exec said the US is facing economic headwinds including higher inflation and policy tightening, as well as ramifications from Russia’s invasion of Ukraine. He’s anticipating more storm clouds to come.
3. The Bank of Finland said Russia is now undergoing “reverse industrialization.” The battered economy is shifting away from investments in technology to support its war on Ukraine: “Russia is stuck ineluctably on a path to lower potential growth and a bleak economic future.”
4. Billionaire investor Barry Sternlicht said inflation is about to drop hard. Rent and housing prices are going to tank and that will show up in the economic data as the year goes on, he explained. He also warned that high interest rates could tip the economy into a severe recession.
5. Bank of America strategists shared exactly what to buy to ride the next bull market. The shift out of a bear market is often marked by three distinct signals, according to BofA. This is what you should look for and how you can capitalize on the next cycle.
6. NBA star Giannis Antetokounmpo spread his fortune across half a dozen bank accounts because of the FDIC’s $250,000 limit. But the Milwaukee Bucks’ billionaire co-owner Marc Lasry told him to investment his cash instead.
7. Shares of Richard Branson’s Virgin Orbit crashed this week. The space company filed for bankruptcy after failing to raise new funds. Get the full details.
8. Eurizon strategists said the US dollar could weaken another 15% over the next 18 months. Stephen Jen, the inventor of the dollar-smile theory, shared his forecast in a recent note, citing cooling inflation as one reason for a depreciating currency. “As the USD loses cyclical support, the US’ familiar structural flaws might again become exposed, as the supportive ‘tide’ recedes.”
9. This recession-investing playbook is based on 150 years of history. And part of the strategy involves capitalizing on these five corners of the market that look attractive right now.
10. Must-see charts illustrate why the economy is heading for trouble. Between stocks, economic data, and financial uncertainty, experts warn of more turmoil. See for yourself.
Curated by Phil Rosen in New York. Feedback or tips? Tweet @philrosenn or email [email protected]
Edited by Max Adams (@maxradams) in New York and Dave Smith (@redletterdave) in Toronto.