{"id":108777,"date":"2017-07-10T10:32:18","date_gmt":"2017-07-10T14:32:18","guid":{"rendered":"http:\/\/countingpips.com\/?p=108777"},"modified":"2017-07-10T08:32:55","modified_gmt":"2017-07-10T12:32:55","slug":"invisible-force-claims-responsibility-for-everspins-ascent","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2017\/07\/invisible-force-claims-responsibility-for-everspins-ascent\/","title":{"rendered":"\u201cInvisible Force\u201d Claims Responsibility for Everspin\u2019s Ascent"},"content":{"rendered":"<div id=\"inves-545813791\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">July 10, 2017<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><p>By <a href=\"http:\/\/WallStreetDaily.com\/\"><u>WallStreetDaily.com<\/u><\/a> <img loading=\"lazy\" decoding=\"async\" class=\"attachment-home-th size-home-th wp-post-image\" style=\"display: block; margin-bottom: 5px; clear: both;\" src=\"https:\/\/s3.amazonaws.com\/wallstreetdailywebsite\/wp-content\/uploads\/2017\/07\/0717_momentum_feature.jpg\" sizes=\"auto, (max-width: 580px) 100vw, 580px\" srcset=\"https:\/\/s3.amazonaws.com\/wallstreetdailywebsite\/wp-content\/uploads\/2017\/07\/0717_momentum_feature.jpg 580w, https:\/\/s3.amazonaws.com\/wallstreetdailywebsite\/wp-content\/uploads\/2017\/07\/0717_momentum_feature-300x155.jpg 300w\" alt=\"\" width=\"580\" height=\"300\" \/><\/p>\n<ul>\n<li>A tiny stock just doubled without any rationale.<\/li>\n<li>Mysterious market forces often trump fundamentals.<\/li>\n<li>How high will shares go?<\/li>\n<li><strong><a href=\"https:\/\/pro.agorafinancial.com\/m\/708934\">Also recommended: Stocks go up 100% of the time when this happens\u2026<\/a><\/strong><\/li>\n<\/ul>\n<hr \/>\n<p><img decoding=\"async\" style=\"float: left; max-width: 85px;\" src=\"https:\/\/duip7hn7nchpo.cloudfront.net\/editor-circle-louis-basenese.jpg\" alt=\"Louis Basenese\" \/>What\u2019s the deal with Everspin Technologies Inc.?<\/p>\n<p>The company is under heavy buying pressure, and momentum will likely push shares above $30 before the end of the month.<\/p>\n<p>Whenever momentum hits such levels, I always take a peek under the hood.<\/p>\n<p>Is it possible that Everspin is disrupting an existing industry?<\/p>\n<p>Here\u2019s what I discovered\u2026<\/p><div id=\"inves-581606874\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<p>Everspin specializes in the development of random-access memory (RAM), which has been around for over 50 years.<\/p>\n<p>Not a single technology invented in the 1960s can push shares from $9 to $22 in six weeks.<\/p>\n<p>So it must be \u201cspecial\u201d RAM, right?<\/p>\n<p>Well, kind of\u2026<\/p>\n<p>Everspin calls it \u201cMRAM\u201d \u2014 a type of memory that retains information even in the absence of power.<\/p>\n<p>Knowing that MRAM can survive a grid meltdown or a catastrophic power failure gets us closer to quantifying the stock\u2019s vertical ascent.<\/p>\n<p>The company also touts a few high-profile customers like Broadcom, NXP and STMicroelectronics.<\/p>\n<p>Heck, even sales are up 27% in the latest quarter.<\/p>\n<p>Still, those metrics alone don\u2019t justify the stock doubling since late May.<\/p>\n<p>This is simply a case where momentum has overpowered reason.<\/p>\n<p>Momentum is a powerful force to invest behind.<\/p>\n<p>My senior analyst, Martin Hutchinson, is regarded as an expert on momentum.<a name=\"video\"><\/a><\/p>\n<p>Hutch\u2019s full report on momentum can be found below.<\/p>\n<p>Ahead of the tape,<\/p>\n<p>Louis Basenese<br \/>\nChief Investment Strategist, <em>Wall Street Daily<\/em><\/p>\n<hr \/>\n<p><script src=\"https:\/\/fast.wistia.com\/assets\/external\/E-v1.js\" async><\/script><\/p>\n<div class=\"wistia_responsive_padding\" style=\"padding: 57.0% 0 0 0; position: relative;\">\n<div class=\"wistia_responsive_wrapper\" style=\"height: 100%; left: 0; position: absolute; top: 0; width: 100%;\">\n<div class=\"wistia_embed wistia_async_bpajaluegt videoFoam=true\" style=\"height: 100%; width: 100%;\"><\/div>\n<\/div>\n<\/div>\n<hr \/>\n<p><b>Question:<\/b> Today we\u2019ll be discussing momentum investing, which is founded upon the belief that stocks in motion will tend to stay in motion.<\/p>\n<p>Let\u2019s jump right in, Martin. How do you define a momentum stock?<\/p>\n<p><b>Martin Hutchinson:<\/b> A momentum stock is one that has shown stronger and persistent trends recently. So a momentum investor buys stocks with positive momentum and sells short those with negative momentum.<\/p>\n<p>And there are a number of advantages of this, and the first is the fundamental fact that the market is not efficient. It doesn\u2019t move in a random walk. If the market were a random walk, which is what people believed for a long time and modern financial theory says it is, then momentum investing wouldn\u2019t work.<\/p>\n<p>But the fact remains is that trends do persist more than would be indicated by chance. So there is some value in momentum investing. It\u2019s just difficult to do. But you can make money doing this.<\/p>\n<p>You can make money jumping into strong stocks in bull markets and weak ones in bear markets. If the stock and the market are going the same direction, the momentum is obviously more likely to persist.<\/p>\n<p>There are cases where this has been highly profitable.<\/p>\n<p>The most obvious case recently is holding on to the FAANGs for a long period. If you\u2019d bought Facebook, Apple, Netflix, Google or Amazon, say, five years ago, then the thing to do wasn\u2019t to jump in and out of those. The strategy was just to shut your eyes and hold onto them. And of course, you\u2019d have made eight, 10 times your money, depending on the stock.<\/p>\n<p>On the bear side, it can also be useful. Stocks can enter a death spiral where they can\u2019t get finance. So selling companies with strong negative momentum, or buying puts on them, can be a very profitable strategy.<\/p>\n<p><b>Question:<\/b> Hutch, tell us, what are the snags?<\/p>\n<p><b>Martin Hutchinson:<\/b> There are a number of disadvantages.<\/p>\n<p>Firstly, with momentum investing, you tend to buy stocks that have gone up a lot. So you may be buying stocks that are overpriced.<\/p>\n<p>You\u2019re paying no attention to fundamentals, and those can be important. You\u2019re paying no attention to value, and that can be important.<\/p>\n<p>And fashions can change, and markets can crack \u2014 quickly.<\/p>\n<p>An example of that is oil in 2014, which went from $100 to $50 a barrel, and all the oil stocks fell out of bed.<\/p>\n<p>Momentum investing is a short-term strategy because momentum factors can change quickly. So you can get whipsawed by sudden change.<\/p>\n<p><b>Question:<\/b> OK, Hutch, before we break, let me give you the final word on momentum investing. What do you suggest? What strategy should our readers be putting forth?<\/p>\n<p><b>Martin Hutchinson:<\/b> I don\u2019t think you should use it as your <i>only<\/i> investing strategy. But you can certainly combine it with value, dividends and other strategies \u2014 and use it for short-term trading.<\/p>\n<p>If you\u2019re just looking to make a quick profit in the next two or three months and there appears to be a really strong trend, then by all means, momentum investing can work.<\/p>\n<p><b>Question:<\/b> So it\u2019s fair to say you better have genuine conviction to go short in a bull market on a stock that\u2019s under positive momentum. And then conversely, the same thing in a bear market \u2014 where a stock is in negative momentum. You better have genuine conviction if you\u2019re going to pull that trigger. Is that accurate?<\/p>\n<p><b>Martin Hutchinson:<\/b> That\u2019s absolutely right. And in particular, if you\u2019re buying put options or taking a bear position in a stock that looks very expensive, you\u2019d better not do it while it\u2019s still going up.<\/p>\n<p><b>Question:<\/b> OK, fair enough. Thanks for your time today, Hutch.<\/p>\n<p><b>Martin Hutchinson:<\/b> Great to be with you.<\/p>\n<p><b>Question:<\/b> This is <i>Wall Street Daily<\/i>, signing off.<\/p>\n<p>Smart investing,<\/p>\n<p>Martin Hutchinson<br \/>\nSenior Analyst, <i>Wall Street Daily<\/i><\/p>\n<p>The post <a href=\"https:\/\/www.wallstreetdaily.com\/2017\/07\/10\/invisible-force-claims-responsibility-everspins-ascent\/\" rel=\"nofollow\">\u201cInvisible Force\u201d Claims Responsibility for Everspin\u2019s Ascent<\/a> appeared first on <a href=\"https:\/\/www.wallstreetdaily.com\" rel=\"nofollow\">Wall Street Daily<\/a>.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By WallStreetDaily.com A tiny stock just doubled without any rationale. Mysterious market forces often trump fundamentals. How high will shares go? Also recommended: Stocks go up 100% of the time when this happens\u2026 What\u2019s the deal with Everspin Technologies Inc.? The company is under heavy buying pressure, and momentum will likely push shares above $30 [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-108777","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/108777","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=108777"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/108777\/revisions"}],"predecessor-version":[{"id":108788,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/108777\/revisions\/108788"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=108777"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=108777"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=108777"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}