Post #7 – For the 1st week of August (Tuesday 1st to Friday 4th)
For this weekly update, 3 key points on the 2 screenshots of my portfolio:
First, my expectations on Water ETFs (Exchange-Traded Funds) went upside down.
Despite the United Nations & the European Union Monitors calling July 2023 the hottest 🔥 🥵 month on record by far – and hottest in around 120,000 years, BEFORE the end of the said month, the indexes of water treatment and distribution companies declined!
In plain English, how is it that the price average of companies, which have their business focused on 1 commodity: Water, decline in a hot season!? Instead of jumping.
By common sense, one would argue that the hottest month would push water consumption up (drinking, showering and swimming at pools to refresh), thus lifting revenues of the water industry. Such logic would encourage investors to buy stocks in water treatment and distribution companies, thus raising the price of their stocks.
Well in the world of Wall Street, it seemed not.
Perhaps, I bought the water ETFs (PIO, PHO, CGW, FIW) a bit late, when their stock prices were close to their respective peaks.
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Second, SouthWest Airline stock (LUV) which hold the record for 47th consecutive profitable years, saw also a slight decline ($1.5) in the middle of traveling season.
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Third, my buy limit of $74.4 on SCHD (Schwab US Dividend Equity ETF) was finally filled at $74.33 (a few cents lower, which is advantageous), after 2 weeks of patience.
I should have been more patient with my Water ETFs and set buy limits.
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The floating profit of my overall portfolio varied between $50 and $20… it closed just at $19.4.
Have a great weekend and see you next week!
Post #8 – For the 2nd & 3rd week of August (Monday 7th to Friday 18th)
The Federal Reserve Bank (Central Bank of USA) released its Minutes of Meeting (detailed document on the discussions and votes) of the last FOMC meeting (Federal Open Market Committee which determines how much money to absorb from or inject into the banking system, via transactions called Open Market Operations. It has a ripple effect on interest rates). The FOMC voted to raise interest rates again and is determined to bent inflation.
As a rule of thumb: When the federal fund rate rises, the prices of stocks decline. Why? The common explanation: it is harder for firms and consumers to get credit to buy or invest, slowing down economic activity but reduces inflation.
Result: it is a hard week for the bulls (those expecting an increase in stock prices) and a great week for the bears (those expecting a decrease in stock prices).
I bought leverage ETFs which beat against the upper ward trend to benefit from such declining general markets.
NASA confirmed that July 2023 was the hottest month on record in history. Nevertheless, water ETFs are still in decline.
