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Arthur Henry

Trade Alert - (SPY) February 2, 2018 BUY

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 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-02 15:38:082018-02-02 15:38:08Trade Alert - (SPY) February 2, 2018 BUY
DougD

February 2, 2018 - MDT Pro Tips A.M.

MDT Alert

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to 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 DougD2018-02-02 09:45:292018-02-02 09:45:29February 2, 2018 - MDT Pro Tips A.M.
Arthur Henry

February 2, 2018

Diary, Newsletter, Summary

Global Market Comments
February 2, 2018
Fiat Lux

Featured Trade:
(MORGAN STANLEY TAKES THE LEAD),
(MS), (GS), (GLD), (FCX), (FXE), (FXY),
(REVISITING THE FIRST SILVER BUBBLE),
(SLV), (SLW)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-02 01:09:042018-02-02 01:09:04February 2, 2018
Arthur Henry

Morgan Stanley Takes the Lead

Diary, Newsletter

It's a good thing that the #MeToo movement wasn't around 35 years ago. For if it was, Morgan Stanley would have been publicly humiliated in the press daily.

The firm was an "old boy" network on steroids. Employees with skirts definitely worked overtime in those prehistoric days.

However firms evolve over the vast expanse of time. Back then, Morgan Stanley was a 1,000 man private partnership hidden away in the old General Motors building on Avenue of the Americas. Today it is a 50,000 member global behemoth bang on Times Square.

The share price has changed a bit too. The average cost of my original partnership shares is 25 cents. They closed at $57 today.

And like Warren Buffet, I never sold my shares so I wouldn't have to pay the capital gains taxes. In fact, my shares cost far less than the company's quarter stock dividend is today.

It wasn't always like this. Morgan drank the Kool-Aide big time during the 2000's real estate bubble. When the bill came due the firm almost went under, with the stock trading down to $5 (which was still 20 times more than my cost). Only a government bailout in the form of the TARP kept my former partners from losing everything.

The Morgan Stanley of today is a shadow of its former self in other ways. There are no more wild practical jokes, BSD's, Masters of the Universe, or Liar's Poker.

I can't imagine the heads of the various equity trading desks meeting at my Sutton Place coop apartment to play high/low poker once a week, as they once did for years.

No one bets the ranch anymore. Morgan Stanley has become boring. However, boredom has a silver lining as it also brings stability, and stock investors absolutely love stability. As incredible as it may sound, Morgan Stanley has become the safe play on Wall Street.

While investors considered the immense trading profits the firm once made as coming out of a black box, fee-based earnings are predictable and reliable as a coupon stream.

You can see this newfound boredom in the firm's employee compensation. A decade ago it was 78% of investment banking revenue, compared to only 18% now. In my day, the janitor wouldn't work for that.

You can thank my late mentor, Barton Biggs, for planting the seeds of the modern firm in the early 1980's. For it was he who founded the firm's fee-based asset management division which is the great wellspring of profits today. Since 2005, Wealth Management's share of profits has leapt from almost nothing during my tenure to 25% to 45% now.

Mortgage loans to customers collateralized by their shareholdings is currently the second largest source of profits. These didn't even exist in my day (Lou Ranieri at Salomon Brothers had the lock on this business back then).

Morgan Stanley has learned some hard lessons along the way. It was forced by the Dodd-Frank financial regulation act to massively recapitalize. No more 40:1 leverage. 10:1 is much safer.

As a result, its capital position has more than doubled from $35 billion during the dark days of the 2008 crash to $77 billion today. Profit margins are the highest since the Dotcom Bubble top in 1999. The firm is even now crafting products and services aimed at the growing band of wealthy Millennials. Sobriety is in.

Goldman Sachs on the other hand has stuck to the old wild west ways. Its earnings remain volatile, as several recent disappointing quarters of bond trading losses have attested to. The firm is now significantly smaller than Morgan, and its share price has been punished accordingly, lagging the heady appreciation of Morgan shares.

Here's the main reason I love my old firm. It is in the catbird seat for what I call the "Exploding Deficit" trade, whereby all future investment is driving by the prospect of rising inflation.

Banks are absolutely in the sweet spot for this strategy, as are gold (GLD), commodities (FCX), and foreign currencies (FXE), (FXY).

Add all this up and you have my explanation for sending out a Trade Alert for a long position in Morgan Stanley yesterday. It won't be the last one.

As for those poker nights, I think some of you guys out there still owe me a couple of grand.

https://www.madhedgefundtrader.com/wp-content/uploads/2018/02/morgan-stanley-street-e1517545425110.jpg 253 400 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-02 01:08:532018-02-02 01:08:53Morgan Stanley Takes the Lead
Arthur Henry

Ferbruary 2, 2018

Tech Letter

Mad Hedge Technology Letter
February 2, 2018
Fiat Lux

Featured Trade:
(SPACE X'S GREAT LEAP FORWARD),
(TSLA), (BA), (LMT)
(SIGN UP FOR MAD HEDGE TECH TRADE ALERT)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-02 01:07:222018-02-02 01:07:22Ferbruary 2, 2018
Arthur Henry

Sign Up Now for Text Messaging of Mad Hedge Tech Trade Alerts

Tech Letter

I invite new subscribers to sign up for our new Mad Hedge Technology text messaging service.

Paid subscribers are able to receive instantaneous text messages of my proprietary Technology Trade Alerts. This eliminates frustrating delays caused by traffic surges on the Internet itself, and by your local server.

This service is provided free to paid members of the Mad Hedge Technology Letter.

To activate your free service, please contact our customer support team at support@madhedgefundtrader.com. In your request, please insert "Tech Text" as the subject, include your mobile number and if you are located outside the United States then please include your country code.

Please note, even if you think your cell phone number is already on file, please email the information anyway as a separate new text list has been created for the newly launched Mad Hedge Technology Letter and is entirely different from the Global Trading Dispatch Trade Alert System.

Time is of the essence in the volatile markets. Individual traders need to grab every advantage they can. This is an important one.

Good luck and good trading.

John Thomas

https://www.madhedgefundtrader.com/wp-content/uploads/2017/10/john-suit-e1507749585324.jpg 201 300 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-02 01:06:552018-02-02 01:06:55Sign Up Now for Text Messaging of Mad Hedge Tech Trade Alerts
Arthur Henry

Space X's Great Leap Forward

Tech Letter

It was an invitation I couldn't believe.

Would I like to watch the largest rocket on earth take off from Cape Canaveral, Florida, read the tease from Space X headquarters?

Specifically, I would view the launch from the Apollo/Saturn V Center some 3.9 miles from the launch pad.

Even at that distance I would have to stand behind blast proof glass. Before they started misting water around igniting rockets to help absorb the blast, windows 20 miles away were blown out.

The cheap seats are in a rusting grandstand astride an alligator invested swamp 7.5 miles away, a relic of the Apollo program of the 1960's and 1970's. Even from there, the force from a launch is impressive.

Space X founder Elon Musk sees the launch as nothing less than the first step by the human race towards becoming an interplanetary species. A colony on Mars is his first goal, followed by deeper space ventures.

The inaugural flight of SpaceX's Falcon Heavy, targeted for Tuesday, February 6, 2018, is one of the most anticipated launches in history.

The rocket will carry into deep space a 2,000-pound Tesla Roadster. Why is Musk doing this? Because he can. Actually, the payload is a test for future commercial launches which are already lining up.

The US Air Force, Saudi Arabia, and Inmarsat, a British communications company, have already contracted to have the Falcon Heavy lift satellites into orbit.

Those of a certain age can only compare the Falcon Heavy to the Saturn V rockets of a half century ago. That program was run by Dr. Werner Von Braun (who I met as a kid at a homemade rocket contest), the man responsible for Hitler's V-2 rocket program.

Those of a certain age can only compare them to the Saturn V rockets of a half century ago. The Saturn program was run by Dr. Werner Von Braun (who I met as a kid), the man responsible for Hitler's V-2 rocket program during WWII. Even now, I remember taxiing my plane over the rails of V-2 launch sites at the airports of French Channel ports. They're still there.

At its peak The Saturn and the rest of the US space effort cost as much as 0.5% of US GPD per year, or some $100 billion in today's money. The Saturn produced 1.5 million pounds of thrust and is the only rocket ever to carry a man beyond earth orbit.

The Falcon Heavy has 3.42 million pounds of thrust and a geostationary payload of 14,000 pounds. But at $90 million it costs a tiny fraction of America's first space program. You can thank imaginative design, advanced materials, and super smart software.

The Falcon Heavy is in fact three Falcon 9 rockets strapped together to create a 27-Merlin engine behemoth. This enables economies of scale that has dropped the cost of sending a payload into orbit by 90% compared to existing government contracts.

The secret to Musk's many visionary ideas has always been manufacturing processes and techniques that are light years ahead of anything previously tried.

The first time I ever saw an industrial use of a laser printer for the production of a rocket engine from a single block of alloy metals. This eliminates the need for welds to hold up in extreme temperatures, greatly increasing reliability.

It helps also that Elon's rockets are reusable, instead of uselessly breaking up over the ocean below. That's why Boeing (BA) and Lockheed Martin's (LMT)'s United Launch Alliance are still billing the government $400 million per trip, for half the payload.

Space X's drive into the brave new world has not been without its setbacks. Musk almost cancelled the program after a series of explosions ate up the company's entire capital. Musk only had enough money for one more launch in 2008.... and it was a success.

Space X's incredible low-cost basis makes a number of ventures commercial viable for the first time, including asteroid mining, zero gravity manufacturing, and yes, space tourism.

Loftier goals are ahead. Space X plans to launch the reusable Dragon capsule in 2019, the first commercial manned space effort. Among the six passengers will be two as yet unnamed billionaires who have paid ten digits for a private trip around the moon.

After the Falcon Heavy, Space X will build another rocket that is twice as big known at the BFR. One can only imagine what this stands for. This will be the vehicle to colonize Mars and beyond.

Musk say that he plans to retire on Mars, at best an arduous nine-month one-way trip. Spending three quarters of a year with the irascible Musk, who I have known for many years, is easier said than done, especially if he is in the driver's seat.

As for stock plays you are going to have to wait a while. Private rocketry promises to be a rich man's game for the foreseeable future, with Amazon's (AMZN) Jeff Bezos and Virgin's Sir Richard Branson the only other players.

While there is no immediate stock play here, there are dozens of space-based ventures in the San Francisco Bay area currently underway. One may be headed your way as an initial public offering sometime in the not so distant future.

Until then, it will be important to follow the technology. It is also a lot of fun to watch.

To learn more about Space X please visit their website by clicking here.

To live stream the Falcon Heavy launch on February 6, please click here.

To buy your own tickets to the Falcon Heavy launch please click here at the NASA website.

Only the cheap seats are still available. Watch out for the alligators.

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-02 01:05:172018-02-02 01:05:17Space X's Great Leap Forward
Arthur Henry

Trade Alert - (MS) February 1, 2018

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 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-01 15:45:112018-02-01 15:45:11Trade Alert - (MS) February 1, 2018
Douglas Davenport

February 1, 2018 - MDT Pro Tips A.M.

MDT Alert

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to 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 Douglas Davenport https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Douglas Davenport2018-02-01 13:03:202018-02-01 13:03:20February 1, 2018 - MDT Pro Tips A.M.
Arthur Henry

February 1, 2018

Diary, Newsletter, Summary

Global Market Comments
February 1, 2018
Fiat Lux

Featured Trade:
(THE DEATH OF THE HIGH YIELD INVESTMENT),
(TIPS), (HYG), (JNK), (TLT), (AJX), (CIM), (BAB),
(EPD), (MMP), (NS), (KMI), (OKE), (WHF), OKE),
(TESTIMONIAL)

https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 Arthur Henry https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Arthur Henry2018-02-01 01:08:002018-02-01 01:08:00February 1, 2018
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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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