Welcome to The Alpha Report 👋

You only have to get rich once. Now is your time.

Major News Today:

• October CPI (Inflation) rises 2.6% YoY, as expected. (Sticky?)

• Elon officially named to “department of government efficiency”.

• Complicating investing often leads to underperformance.

• 30 year fixed mortgage rate falls to 7.07% from 7.08% yesterday.

• 10 year treasury bond yield climbs to 4.45% from 4.42% yesterday.

Million Dollar Lesson:

People assume that if their stock goes up, they made the right decision to buy.

They also assume that if the stock is going down, something bad must be happening with the company.

Both of which can be true, but it doesn’t have to be.

Some stocks take a dip just cause they aren’t the “hot stock” anymore but the fundamentals remain solid (good buying opportunity)

Some dip cause it’s justified though. (Maybe bad earnings and guidance)

Moral of the story, understand why a stock is making a move. Just cause it goes up or down, that doesn’t necessarily correlate to the fundamentals and a justified price move.

October Inflation Data Breakdown

• Seems like a decent report

• October US CPI annual inflation rises 2.6%, in line with expectations for 2.6%.

• Core CPI inflation increased 3.3% Y/Y, matching forecasts for a gain of 3.3%.

• Key contributors to MoM is rent is transportation services (mostly airline fares) but that could be cause of holidays. But really that’s a small part of the entire bucket.

• Key contributors YoY are food away from home, energy, shelter, auto insurance. A lot of the data in those categories is usually laggy so there’s a good chance it’s actually lower vs what is reported, especially for auto insurance and shelter.

• This is the full table below for the inflation data.

  

Elon vs Everyone

• Elon was officially named to the new branch of government, “Department of Government Efficiency”

• Along side him will be Vivek Ramaswamy, who was a candidate for the republican party for this election cycle.

• I am sure this will be interesting to watch and see how they “drain the swamp” and get things running more efficiently.

• Love Elon or hate him, he did miracles with Tesla, being the ONLY EV car company to be profitable.

• Imagine what he can do with cutting unnecessary costs in America and get closer to a balanced budget.

Potential New Trades:

• Google 1 yr+ play (buy calls/sell puts)

• Amazon long term play 3+ yrs (sell puts/buy shares)

• Nvidia on dip (Buy Shares)

• SOXX long term play 3+ yrs (buy shares/sell puts)

• TSLA buy puts (3 month duration) Ultra risky though

Current Valuations & Price Targets

• The S&P 500 (Ticker: VOO) at a PE ratio of about 22.3 right now, we are a little lofty. (But not crazy expensive) BUT, rates are expected to fall and I agree with the expectations. Rates are like gravity on the market. If rates fall, stocks become the only game worth playing, which will push up valuations.

• The Nasdaq 100 (Ticker: QQQ) at a PE of 31.6 is a little lofty also. So how do we value that? What do we price in? How much will Ai play into this growth? All things that nobody on earth knows 100% Me personally, I feel the earnings growth of the Nasdaq (QQQ) will be higher vs what the SP500 does. That is why QQQ is justified to get a higher PE ratio. Being its priced at a PE of 31.4, that is not crazy over valued in my opinion. Especially in an environment that is expecting lower interest rates. Most people do NOT put enough emphasis on how big of a deal rates are...

• Rates are gravity. We are currently at 4.75% fed funds rate now. We are expected to be at 4 in a year. 1% is a decent cut and that will make a difference.

2025 QQQ Price Prediction End of Year: $530

2025 VOO Price Prediction End of Year: $580

Tip of The Day:

Never stop learning.

Always be a student of the craft.

Learn from people that actually have millions.

Do not be afraid to invest in your education.

Current Value of My Trading Account:

• The market went sideways today, which is very welcomed!

• Going up every day is not healthy.

  

Final Comments:

• The market went sideways today, which is totally normal and healthy.

• Inflation data came in at expectations, but is a little sticky at the 2.6% level. (Target is 2%)

• Keep your emotions in check on pumps and dumps.

• Continue to DCA into quality stocks/ETFs

• When you find undervalued companies, use options to magnify gains

👇Check Out My Links Below👇