This week’s Alpha Trader podcast features hosts Aaron Task and Stephen Alpher talking markets with Bob Iaccino, who is making a return appearance to the show. Bob is co-founder of PureXposure Growth Series, as well as Chief Strategist at Path Trading Partners.
September wasn’t the best month for stocks, and last week was a volatile one, but Iaccino notes the market as having shaken off a lot of the negativity by last Friday. It doesn’t necessarily make him bullish over the near term, but the price action is worth paying attention to (an idea that might have been borne out by the big rise in stocks on Monday).
The dollar (USDOLLAR, UUP) has been on a nice run higher of late, and Iaccino has been, and continues to be a bull. While the conventional wisdom says money has flowed into the greenback thanks to shakiness in equity markets, Iaccino over the summer noticed the Fed’s balance sheet actually shrunk for several weeks. It was this slowing of dollar creation by the central bank that turned him bullish.
Turning to some stock picks, Iaccino is staying away from the FAANG players, but does want to be long names that might not be too affected no matter the outcome of the election or the virus. Among them is Cheesecake Factory (NASDAQ:CAKE), which might seem an unusual pick given its big presence in malls. But Iaccino notes the company’s sizable market position gives it pricing power in terms of rent concessions, its large spaces allow for social distancing, and takeout is a big part of the business.
Another long is Dollar General (NYSE:DG), which Iaccino considers his recession play.
Turning to growth, Iaccino is a fan of PayPal (NASDAQ:PYPL), calling it the “anti-XLF stock.” Iaccino: You want to be long stocks whose product becomes a verb, and PayPal has that (“Venmo me”).
There’s plenty more, including why Iaccino is flat gold (XAUUSD:CUR), is intrigued enough by Bitcoin (BTC-USD) to have just a small position, and why he recently got long oil (CL1:COM). As Iacinno advised in his first Alpha Trader appearance, if you’re bullish on oil, buy oil (not an ETF, and not the oil producers).