(New York)

One of the most famous hedge fund managers just made what seems a bold and countercyclical move. That manager is David Einhorn, and the move is to ditch all tech stocks and buy retail instead. In its most recent quarterly filings, Einhorn’s Greenlight Capital bought shares of Gap, Best Buy, Dollar General, TJX Companies, and Dollar Tree, all while significantly pairing holdings of Apple and Micron Technology.

FINSUM: Retail has had a good run over the last year, but the industry is still facing some major headwinds. We think buying retail now seems like a macro bet that the US economy will stay strong.

(New York)

Dividend stocks are in an odd place right now. The yield curve looks likely to invert as short-term rates have risen and long-term yields continue to fall. This has made the average S&P 500 yield look quite weak relative to bonds. However, there are some really good picks out there. All the stocks listed here have dividends of 2.8% or more, and most have dividend growth rates of 20% or more. These stocks include AbbVie, LyondellBasell Industries, Broadcom, Regions Financial, and Starbucks.

FINSUM: What an interesting mix of companies and industries. These definitely seem worth a look. Starbucks is an interesting case for us.

(New York)

Well it finally happened. Investors had been waiting anxiously to see if the SEC would act over Elon Musk’s highly unusual way of announcing his buyout intentions last week. Musk tweeted out his plans to take the company private at $420 per share. The SEC has been looking into whether this is a violation of disclosure rules or even intentionally misleading information. The big question is whether Musk actually had the “funding secured” as he said, because if not, it could be the basis for a market manipulation charge. At least two lawsuits have been filed against Tesla since the tweet.

FINSUM: So the SEC says companies are allowed to announce material info over social media, so this case is really just about whether the statement was misleading.

(New York)

A lot of investors are worried about the potential for an inverted yield curve, and not just because of what it could mean for markets and the economy. If you are holding long-term bonds that will be yielding less than shorter-term bonds, you are likely going to be incentivized to reshuffle your holdings. Accordingly, Citigroup has come out with a first of its kind product that allows retail investors to fully redeem the principal on their bonds if the yield curve inverts. According to Bloomberg the “30-year constant maturity swap rate can sink as much as 10 basis points below the two-year rate before holders start incurring losses”. Continuing, “The products pay a coupon and return full principal as long as the spread remains greater than that level”.

FINSUM: This seems a bit sophisticated for most retail investors, but it is definitely an interesting product and potentially a good one for hedging.

(New York)

Stocks have done very well over the last month and a half. The correction—one of the longest on record—ended and stocks are back near an all-time high. But where do we go from here? One Wall Street analyst says the S&P 500 is in for major gains, with the index set to rise 12% before the end of the year. The analyst, from Cannacord Genuity, sees surging corporate earnings and rising consumer confidence as key to the market expansion. He sums up his view this way, saying “There is no doubt the unpredictable news backdrop of a potential trade war with China and a rise back to 3 percent in the 10-year U.S. Treasury yield can cause increased volatility, but the fundamental backdrop commands using it as an opportunity to add risk”.

FINSUM: The principal components of the argument seem sound, but we will admit we are a bit concerned about an earnings peak even though history tells us not to be.