Stocks

Interesting, and often contrarian, Snippets on individual companies and the stock market.

Stocks

Starship

  • Starship, the fully reusable rocket under development by SpaceX, is a revolution the industry grossly under-appreciates. So goes this fascinating blog post.
  • “Starship matters. It’s not just a really big rocket, like any other rocket on steroids. It’s a continuing and dedicated attempt to achieve the “Holy Grail” of rocketry, a fully and rapidly reusable orbital class rocket that can be mass manufactured. It is intended to enable a conveyor belt logistical capacity to Low Earth Orbit (LEO) comparable to the Berlin Airlift.“
  • “Consider the two critical metrics: Dollars per tonne ($/T) and tonnes per year (T/year) … Starship is intended to reach numbers as low as $1m/T and 1000 T/year for cargo soft landed on the Moon. Apollo achieved about $2b/T and 2 T/year for cargo soft landed on the Moon.“
  • It is developing in leaps – “Two years ago Starship was a design concept and a mock up. Today it’s a 95% complete prototype that will soon fly to space and may even make it back in one piece.“
Stocks

SaaS Unlocks Software Use

  • Latest annual presentation is out from Benedict Evans.
  • Absolutely worth a look as it nicely covers macro and strategic trends from the tech industry.
  • This chart shows how software as a service (SaaS) has pushed up the amount of software companies can use (as there is no need to get IT to install/support/configure new applications).
  • The move to cloud delivery for software has miles to go (it is just 10-15% of enterprise IT spend and 20-30% of workloads).
Stocks

Spoken Word

  • Spoken word audio (think podcasts, audiobooks etc) is taking share of listening away from music.
  • 22m more people in the US are listening to spoken word than seven years ago.
  • The biggest growth driver has been podcasts – which represent 22% of spoken word, up from 8% in 2014.
  • Lots more stats in this NPR/Edison Research report.
Stocks

Fintech Lending

  • Interesting study by IMF on fintech’s experience during the Covid crisis.
  • The chart shows continued strong growth through 2020 by fintech lenders, outpacing traditional institutions.
  • But also a pronounced increase in non-performing assets, something traditional lenders did not see.
  • This work is based on data from 20 economies and is part of the IMF Global Financial Stability Report.
Stocks

Factors

  • Since its inception financial research has been on the hunt for factors that can consistently generate positive returns. Most famously Fama and French’s value factor.
  • This search has led to a what one author has termed the “factor zoo” – a proliferation of factors – a direct consequence of data mining.
  • There is also a replication crisis – that factors are not internally (i.e. the results can’t be replicated within the original sample) and externally (i.e. results can’t be replicated out of sample) valid.
  • This paper (summary here) is a rebuttal of these issue – it uses Bayesian updating from a prior that a factor’s usefulness is zero. Their work finds that no crisis exists.
  • One idea worth thinking about is that according to the authors the 153 factors explored actually cluster into 13 themes – “possessing a high degree of within-theme return correlation and economic concept similarity, and low across-theme correlation” (as seen in the chart).
  • h/t AQR Research.
Stocks

Disney World

  • Collection Disney World maps through the years.
  • “This enormous land parcel is also unique in that it’s a kind of self-governing municipality, with its own fire department and emergency services. The district—officially known as the Reedy Creek Improvement District—is governed by a five-person Board of Supervisors elected by the landowners in the district. As a result, high-level Disney employees essentially run the entire region encompassing WDW.“
  • The area is so vast that “The Magic Kingdom parking lot, for example, is actually larger than the theme park itself.”
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