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Mad Hedge Fund Trader

April 16, 2019 - Quote of the Day

Tech Letter

“Put the right people in the right places, and then you trust them to do the right stuff.” – Said CEO of Uber Dara Khosrowshahi

 

 

https://www.madhedgefundtrader.com/wp-content/uploads/2019/04/qotd-apr16.png 522 377 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-16 08:05:192019-07-10 21:50:31April 16, 2019 - Quote of the Day
Mad Hedge Fund Trader

April 16, 2019

Diary, Newsletter, Summary

Global Market Comments
April 16, 2019
Fiat Lux

Featured Trade:

(WHY YOU WILL LOSE YOU JOB IN THE NEXT FIVE YEARS,
AND WHAT TO DO ABOUT IT),
(BLK)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-16 04:07:152019-04-16 03:56:18April 16, 2019
Mad Hedge Fund Trader

Mad Hedge Hot Tips for April 15, 2019

Hot Tips

Mad Hedge Hot Tips
April 15, 2019
Fiat Lux

The Five Most Important Things That Happened Today
(and what to do about them)

 

1) President Says the Dow Should Be 5,000-10,000 Higher, if only the Fed hadn’t raised interest rates last year. That would take the market multiple up to a record 25X. This is coming from a guy who went bankrupt four times himself buying at market tops. But is he buying now himself? Click here.

2) Watch Out for the Plane Shortage This Summer, as the 737 Max software fix drags on. American Airlines has already cancelled hundreds of vacation flights. Book that ticket early. Buy (BA) on the dip. Click here.

3) Home Mortgage Demand is Soaring. It looks like an ultra-low 4.03% 30-year fixed rate mortgage is going to rescue the residential real estate market from the jaws of defeat this spring. Click here.

4) Broker Earnings in Free Fall, as collapsing trading volumes take a bite. It seems investor faith in this rally is almost nil. Risk is high. Take profits you lucky bastard. Click here.

5) Earnings Are Coming in Better Than Expected for Q1. It is looking like companies excessively cut forecasts during the dark days of December. But is it already in the price? Cut risk. Click here.

Published today in the Mad Hedge Global Trading Dispatch and Mad Hedge Technology Letter:

(MARKET OUTLOOK FOR THE WEEK AHEAD, OR QE IS BACK!),

(SPY), (TLT), (TSLA), (DIS), (FCX), (GOOG), (MSFT), (AMZN),

(REACHING PEAK SOCIAL MEDIA)

(SNAP), (FB), (PINS), (TWTR), (GOOGL)

 

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-15 12:21:432019-04-15 12:21:43Mad Hedge Hot Tips for April 15, 2019
DougD

Trade Alert - (AMZN) April 15, 2019 - TAKE PROFITS

Tech Alert, Trade Alert

When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline. Read more

https://www.madhedgefundtrader.com/wp-content/uploads/2016/02/Alert-e1457452190575.jpg 135 150 DougD https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png DougD2019-04-15 11:54:532019-04-15 11:54:53Trade Alert - (AMZN) April 15, 2019 - TAKE PROFITS
DougD

Tech Trade Alert - (AMZN) April 15, 2019 - TAKE PROFITS

Tech Alert, Trade Alert

When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline. Read more

https://www.madhedgefundtrader.com/wp-content/uploads/2016/02/Alert-e1457452190575.jpg 135 150 DougD https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png DougD2019-04-15 11:38:502019-04-15 11:38:50Tech Trade Alert - (AMZN) April 15, 2019 - TAKE PROFITS
DougD

April 15, 2019 - MDT Alert (AMC)

MDT Alert

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to the six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 DougD https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png DougD2019-04-15 10:37:192019-04-15 10:37:19April 15, 2019 - MDT Alert (AMC)
Mad Hedge Fund Trader

April 15, 2019 - MDT Pro Tips A.M.

MDT Alert

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-15 09:13:472019-04-15 09:13:47April 15, 2019 - MDT Pro Tips A.M.
Mad Hedge Fund Trader

April 15, 2019

Diary, Newsletter, Summary

Global Market Comments
April 15, 2019
Fiat Lux

Featured Trade:

(MARKET OUTLOOK FOR THE WEEK AHEAD, OR QE IS BACK!),
(SPY), (TLT), (TSLA), (DIS), (FCX), (GOOG), (MSFT), (AMZN)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-15 08:07:332019-04-15 08:38:46April 15, 2019
Mad Hedge Fund Trader

April 15, 2019

Tech Letter

Mad Hedge Technology Letter
April 15, 2019
Fiat Lux

Featured Trade:

(XXXXX)
(SNAP), (FB), (PINS), (TWTR), (GOOGL)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-15 08:07:172019-07-10 21:50:37April 15, 2019
Mad Hedge Fund Trader

Reaching Peak Social Media

Tech Letter

America is full – that is what domestic social media growth is telling us.

The once mesmerizing service that captured the imagination of the American public has soured in the country that created it.

Online advertising consultant emarketer.com issued a report showing that Snapchat (SNAP), the worst of the top social media outlets, will lose users in 2019.

The 77.5 million users forecasted by the end of 2019 represents a 2.8% YOY decrease.

This report differs greatly from the report eMarketer issued just past August showing that Snapchat was preparing for a rise of 6.6% YOY in 2019.

The delta, rate of change, represents a massive downshift in expectations and the sentiment stems from the widespread saturation of social media assets.

Market penetration has run its course and the players have run out of bullets mainly targeting Generation Z.

These platforms have given up on baby boomers and Snap feels that pursuing the millennial demographic would be an exercise in futility.

Even more disheartening is that between 2020-2023, there will be only a minor uptick of user growth by 600,000 users clamping down on the impetus of a comeback of sorts shackling the business model.

The trend is not mutually exclusive to Snap, Twitter or Facebook, social media as a group will only expand the overall user base by 2.4% in 2020 hardly satisfying the appetite for growth that these companies publicly advertise.

Remember that much of Instagram’s growth originates from borrowing Snapchat users by way of copying their best features.

Even with this dirty tactic, growth seems to be petering out.

Snap’s shares have made a nice double after peaking shortly over $25 after the IPO.

But the double was a case of investors believing that management and execution had hit rock bottom – the proverbial dead cat bounce in full effect.

Now investors will pause to reassess whether there is another reasonable catalyst to drive the stock higher.

First, investors will need to ask themselves, is Snap in for another double?

Absolutely not.

So where does Snap go from here?

I believe they will borrow from the playbook of Mark Zuckerberg and attempt to emphasize supercharging average revenue per user (ARPU).

Whether the company arrives at this conclusion by chance or strategy, they must confront the reality that there are almost no other levers to pull if they want to perpetuate this growth story.

M&A is also off the table because the company is burning through cash.

Facebook’s (ARPU) came in at $7.37 last quarter indicating how Snap needs to make substantial headway in this metric with last quarter’s paltry (ARPU) at $2.09.

Essentially, management will conclude that each user isn’t absorbing enough ads because of declining user engagement.

Snap CEO Evan Spiegel will need to improve the pricing power charging advertisers at higher rates.

Obviously, the lack of an attractive platform resulting from poor execution and engineering problems needs a quick turnaround.

It’s not all smooth sailing for Facebook either, they keep chopping and reshaping strategy by the day attempting to minimize costs as the regulation burdens rot at the bottom line.

On the bright side, regulation hasn’t been as bad as initially thought – usership hasn’t dropped by orders of magnitudes.

In fact, Facebook’s users have shown a resurgent indifference to Facebook chopping up their data and repackaging it to 3rd parties, meaning Facebook has come through rather unscathed in the face of a PR storm.

There have even been recent reports of Zuckerberg being persuaded to start paying journalists for original content, a vast pivot for his hyped-up propaganda machine of being in the distribution business.

Juicing up (ARPU) is the lowest hanging fruit on offer for Snapchat and Facebook right now, overperforming in this sphere will improve financials and keep the mosquitoes away while affording them time to ponder how to reaccelerate user growth.

One outsized negative trend is that 90% of user growth appears to originate from undeveloped nations with a lack of discretionary spending power showing that this strategy has its limits.

Searching for another tool in its toolkit will redefine Snapchat, Twitter, and Facebook as we know it.

I would even classify it as an existential crisis.

Instagram have bought Facebook the most time to readjust its future direction highlighting that stealing Snapchat’s audience is still effective, expecting user growth to climb to 106.7 million US users, up 6.2% from 2018.

Instagram will continue its expansion by adding nearly 19 million new US users by 2023, but as much as it adds to its new social media asset, Facebook will be struggling for new net adds.

Snapchat is in dire straits and the stock market bubble could support the share price for up to another 8-12 months, but when the guillotine drops on Snapchat, the blood will smatter everywhere.

The company also plans to introduce a gaming service to take advantage of the popularity with its core users, Generation Z.

This should be the trick that breathes life into operating margins and (ARPU) which is why I believe the stock will hold up for the next period of time.

But with the gaming initiatives also comes rampant competition with the likes of Alphabet (GOOGL) and don’t forget Fortnite is still the 800-pound gorilla.

These trends also bode negatively for Pinterest (PINS) who might be going public as the last shot of tequila is downed at the after party.

 

 

 

 

SNAPCHAT ARPU

https://www.madhedgefundtrader.com/wp-content/uploads/2019/04/snap-users.png 677 720 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2019-04-15 08:06:512019-07-10 21:50:42Reaching Peak Social Media
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There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.

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