Out of the 50,000 financial instruments that are available to trade on public markets there are only a few that are really, really attractive. In other words only a limited number of stocks, assets or instruments like ETFs are worth your capital. One of the few sectors that looks extremely juicy is the mobile payment sector, with the IPAY ETF representing the sector. We did include one stock in this sector in our 2019 forecasts. Unsurprisingly, as per Tsaklanos his 1/99 Investing Principles, it is 1% of this ETF’s components that has really, really above average profit potential.
If there is one ETF that really looks awesome it is IPAY ETF.
An ETF has many components, from large to small companies, but typically the top 10 accounts for +50% of the weight.
IPAY ETF has top 10 holdings outlined in below visual. Most of these companies are (very) large cap companies in the U.S.
Note that all stocks featured in this MarketWatch cashless stocks article are included in IPAY ETF.
Interestingly, when we review all the holdings, one by one, we see the following picture:
- The large caps have a very consistent view: a long term rising pattern which is very similar to the IPAY ETF rising chart pattern shown on below chart.
- A few holdings, mostly small caps to mid caps, are somehow neutral, in a sideways range.
- There are just a few that look really ugly, again only a few ones.
- Then there is one, just one, tiny company in this whole list that looks awesome!
The IPAY ETF is a play on the long term rising trend of the stock bull market. In fact IPAY ETF has leverage on the broad market trend. So once the stock bull market ends, investors have to liquidate the IPAY ETF.
However, this one tiny great looking stock in the list of IPAY ETF is one that has really different. It is in an expansion phase, and has lots of upside potential. Risk is also above average because it is a nano cap stock. We are about to flash a buy alert on this stock, but need a bit more time to review all the data and financials.
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