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Click here to view this email in your browser. Hey Traders
Welcome to Beyond The Trade!
Today, we have another round of trading news and information from our top analysts here at Traders Agency. And of course, our Trade of the Day.
The Key Developments Today:
US Stocks Indexes on the Line: The S&P 500 Index is trading around its 50-day moving average that is seen as a defensive line.
If this is fully broken, traders will be looking for a potential further drop next week. But note that today was a big trading expiration date for derived stock securities that can distort trading ahead of tomorrow’s settlements.
And quarter-end is coming up, with expected strategic buying by fund managers.
US Consumers Further Onboard: Today’s University of Michigan Sentiment Index was up at 71.00 confirming this past week’s other stronger data on retail sales, a drop in continuing jobless claims and the very strong Consumer Comfort Index from Langer/Bloomberg.
This should be supportive for US stocks.
Foreign Investment Inflows Further Up: The US Treasury monthly foreign net investment inflow data showed yet another big surge in buying of US stocks and bonds from foreign investors.
This confirms that the US remains a strong destination for investment.
To keep me up on what you’re thinking or what you want to see us cover – you can always email me directly at neilgeorge@tradersagency.com.
Now, on to our Trade of the Day…
Trade of the Day: Atlas Corporation
Shipping is the crisis market right now. From retailers that need to fill shelves in stores and warehouses to manufacturers needing components, getting stuff primarily from Asia to the US is the big thing right now.
And with limited numbers of container ships as well as the actual containers themselves – the cost of shipping from Asia to the US and even to Europe is soaring.
The leading index of shipping costs is the Shanghai Shipping Exchange Index that tracks the costs for 15 primary shipping routes. And that cost on average has soared by 365.57% since February of last year, and it is accelerating with the trailing five months gaining by 76.69%.
There are some opportunities to get on board some shipping companies in this price maker market right now. One of my favorites that I’ve followed for many years is Seaspan, which was acquired by Atlas Corporation (ATCO) not that long ago.
Atlas Corporation is billing itself as an investment holding company that provides some impressive tax savings for itself and for its investors.
It owns two things. The first is APR Energy, which is an interesting company that provides turn-key power generating systems for temporary or semipermanent settings.
This works for disaster recovery or for far-reaching operations that are situated well off the grid. It is a good company, but what I really like is the second company – Seaspan.
Seaspan is like a real estate investment trust (REIT) for ships. It owns a younger and in-demand fleet of ships for making transpacific crossings.
It leases them out – typically on net lease terms, which means that the operators of the ships pay for nearly everything. It collects the rent on the ships, and that rent is getting seriously heavy.
Its container shipping revenue is the primary source for the company, and it was soaring even before the recent developments – gaining by an average of 19.57% over the past three years. With the rates and demand for its ships, look for higher revenue gains over the coming quarters.
As you would expect, the operating margin for just owning and leasing ships is very fat at 32.30%. And it has ongoing predictable cash flows for its coffers and controlled debts, so it has the ability to keep adding to its fleet. Atlas Corporation Price -- Source: Bloomberg The company is not well followed, so it took a while for folks to find it. But now the stock is in play as you see above.
This does not mean that you are late to the party. The stock is priced now at a mere 1.06 times its intrinsic (book) value.
That means that you can buy it now at a price that can’t just replace its ships for months or years and get the power company pretty much at cost. That is a serious deal.
And it even pays a nice dividend that’s running at 3.20%.
With the current price at $15.83, ATCO is a buy under $16.45 with a near-term target of $17.25 and even more beyond that. And for safety, consider a stop at $14.59.
Now, on to the best of Traders Agency… Don't be afraid of risk when trading
We've made it to Friday, and that means it's time to wrap up another week of trading, enjoy the weekend, and get ready to start again on Monday!
Reviewing some of the important data that supports my strategy is one of the best ways to prepare for the trading week. And one of the biggest concerns I get from many of my students is the risk that's involved in trading.
Anything involving money is inherently risky. That is simply a fact of life. However, because of the risk of financial loss, trading may make a lot of individuals anxious.
However, if you use the right strategy, you can mitigate the potential for loss and make sure you win more trades than you lose!
Keep reading to learn how to properly gauge and manage risk while trading the futures market. Get Josh's Daily DirectionHow To Trade a High-Flying Stock
Today, I’m going to show you how to trade a high-flying stock.
This is a stock that recently came right out of the box with its initial public offering (IPO).
After an initial pop, it went through a lull. But, whoa! Now it’s up strongly, with more in the works.
You can buy a winning stock – even at what might appear to be a higher price – if you follow my rules.
That’s what I’m going to present to you today and the stock to trade for more gains to come. Get Stock Surge Daily
As of this writing, the US stock benchmark S&P 500 Index is heading for two weeks of down performance.
Join the War Room NOW! Now's the time to take the plunge into futures
So you took the plunge and started a paper trading demo account. Congrats on taking the first step into the exciting world of trading! Not a lot of people make it this far.
In this video tutorial, Josh goes over what to do after creating a paper trading demo account. Many new traders start a paper trading account, start trading with a ridiculous amount of fake money, see significant results, and are let down with substantially smaller returns when they start trading with real money.
Check out Josh's video to find out why that happens and how to avoid it! Get Daily Trader Talk
These 4 stocks are TOXIC for your portfolio Tim talks a lot about how to manage your money for higher profits, and we provide a lot of stock ideas that you can buy right now...
But there are some stocks that are just TOXIC and need to be sold!
Even if they go higher, you don't want to own them... because the risk of holding these things is just so extraordinary. Get A Better Way To Wealth
Thank you for reading Beyond The Trade! Look for much, much more Monday and every day the markets are open.
You’ll get further updates on all that is going on to make your job as a trader all the more profitable and better informed.
I’ll also continue to provide updates on the stock ideas I bring to you in Beyond The Trade.
To provide feedback, suggestions and questions, feel free to email me directly at neilgeorge@tradersagency.com.
All My Best, Neil George, Executive Editor at Traders Agency
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