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Increased Concentration
This Week on The Compound
This week on The Compound
This week on TCAF, Josh and Michael were joined by Eric Jackson of EMJ Capital and Alex Kantrowitz of Big Technology. They discussed the state of AI, the return of Roaring Kitty and Elon Musk’s tenure at Tesla. (Listen)
How Shopping Can Earn You Free Shares of Stock | TCAF Tuesday (Listen)
Jamie Dimon vs. Private Credit | What Are Your Thoughts? (Listen)
How Would You Invest $14 Million? | Ask the Compound (Listen)
Reasons to Keep Nvidia, Apple and Amazon | The Compound and Friends (Listen)
How to Fund a Roth at Any Income Level | Jill on Money Tips (Listen)
OUTSIDE THE COMPOUND
The word of the week is…concentration. Nvidia briefly topped $3 trillion in market cap, highlighting that the U.S. stock market is increasingly concentrated. In a recent research paper, Michael Mauboussin and Dan Callahan at Morgan Stanley Investment Management weighed in on some of the potential implications of this trend.
Rising stock market concentration is challenging for active managers because on average they own stocks with smaller market capitalizations than those in their benchmarks. That means when large cap stocks do well relative to small cap stocks, the percentage of mutual funds that outperform the benchmark tends to go down.
MERCH
A one-of-a-kind finance-themed Hawaiian shirt just dropped! It is a collab between The Compound and Tropical Bros. The best thing is that 10% of all sales will be donated to No Kid Hungry.
INSIDE THE COMPOUND
It’s hard to live in modern society without a credit card. However, how many credit cards should you have, and should you try to max out your credit card rewards? In the end, it depends on you and your unique financial situation. Nick Maggiulli at Of Dollars and Data weighs in.
While playing the credit card rewards game can be beneficial, it’s not for everyone in every circumstance. This is especially true if you are extremely busy, in financial trouble, or need to keep a high credit score.
COMING SOON
On TCAF next week, Josh and Michael will be joined by Alicia Levine, Head of Investment Strategy and Equity Advisory Solutions, at BNY Mellon Wealth Management.
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