Wall Street’s focus this week will be on the annual Jackson Hole Economic Policy Symposium to be held from August 21 to 23. Market participants will also gear up for a deluge of quarterly results from retail companies. Meanwhile, Russia and Ukraine developments will continue to grab eyeballs, with the latter nation’s President Volodymyr Zelenskyy set to meet U.S. President Donald Trump on Monday.
The Jackson Hole gathering will see some of the world’s most well-known central bankers, economists, and financial experts convene. The theme this year is “Labor Markets in Transition: Demographics, Productivity, and Macroeconomic Policy.” With the Federal Reserve’s dual mandate of price stability and maximum employment coming under pressure after concerning jobs and inflation data this month, market participants will be watching the symposium keenly for any clues on the central bank’s future actions.
Turning to the earnings calendar, retail giants Walmart (WMT) and Home Depot (HD) will headline the week, along with smaller rivals Target (TGT) and Lowe’s (LOW).
In terms of economic data, investors will be receiving the minutes of the Fed’s July monetary policy committee meeting on Wednesday, followed by S&P flash PMIs on Thursday.
Investing Group Spotlight
Before joining Seeking Alpha and launching his small-value-focused group Second Wind Capital in 2020, Courage & Conviction Investing was a buy-side analyst for more than a decade, handling both a $45B bond portfolio and the energy sector. His unique ability to synthesize balance sheet issues and the competitive landscape for each company he covers sets him apart. He speaks regularly with the management teams about his highest conviction ideas.
Focusing on inefficient small-cap value and special situation stocks often overlooked by larger investors, Second Wind Capital utilizes a two-pronged approach—a “Focus list” to be held for longer periods and a “Tactical portfolio” for short-term trading. This dual strategy allows for both long-term thesis plays and short-term gains, helping to offset periods where value stocks remain undervalued.
A critical component of this strategy is high-conviction sizing, where a small number of core holdings are given a large portion of the portfolio’s capital at risk. Case in point: A single investment, Cineverse Corp. (CNVS), contributed nearly 41% of the portfolio’s total return YTD. As small caps are often (very) inefficient, another key component is the ability to take drawdowns and turn them into big gains. For example, the strategy bought GPRE in the $9s, rode it down to the $3s, more than doubled down in the mid to upper $3s, and booked large gains when it rebounded to $9 eight months later.
The strategy has generated a 5-year CAGR of 55.5%. This is not theory – all trades are made in a real money account, with every trade meticulously documented within Second Wind Capital’s chat room and Coverage list. See an in-depth (and free) deep dive into this alpha-achieving strategy.
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