Hello from downtown Dallas, Texas.
My team and I are on the road all week at a gathering of investment professionals. We’ve spent the past couple days chatting with insiders and taking notes. So today we’re doing something a little different...
Instead of the usual weekly essay, below you’ll find an interview between me and RiskHedge Editor-in-Chief Dan Steinhart. In it, we give you a “behind the scenes” look at an exciting change taking place at RiskHedge, and what it means for you.
Talk to you soon,
Chief Analyst, RiskHedge
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Dan Steinhart: Stephen, most readers won’t know this, but we’re coming up on the one-year anniversary of your first RiskHedge Report issue.
Stephen McBride: Yes, I actually wrote it from a coffee shop in Vermont last June. When I hit the send button I had no idea what to expect. A couple people read it and we got two notes of feedback. And one of them was from my mom [laughs].
DS: But folks passed the letter around and readership grew pretty quickly. Over 30,000 investors now read you every week. Why do you think it’s grown so fast?
SM: One thing I like about disruption is most smart investors just “get” the importance of it. They see the world changing faster than ever, and they know the old ways of investing no longer cut it. Not when S&P 500 stocks are dropping like flies, and smaller disruptive companies are rising to replace them, in some cases practically overnight.
DS: You’re saying disruption touches everything.
SM: It touches everything in the markets, yes. Disruption isn’t a niche like energy stocks or corporate bonds. If you aren’t interested in those things, you can choose to ignore them and still earn strong investment returns elsewhere.
But these days, you can’t ignore disruption and expect to do well investing. If you fail to understand the disruptive changes taking place, you’ll be left behind. You’ll end up owning stocks that might seem “safe” to the average guy... but that are actually in great danger of losing 50% of their value or more. And you’ll miss out on great opportunities to earn big, safe profits. Bigger than ordinary stocks can bring you.
DS: You’ve met and talked to a lot of readers. Is there a “typical” RiskHedge reader?
SM: Not really. I just met a reader here in Dallas who is an airplane pilot. But our readers come from all walks of life—doctors, teachers, lawyers, entrepreneurs, CEOs, investment professionals, accountants, retired folks.
If there’s a common thread, it’s that RiskHedge readers are planners. If you’re reading this letter, you’re likely a financially responsible person. You likely spend a good deal of time thinking about your family’s financial future. You’re not the type of person who would leave something so important up to chance.
DS: So you mentioned RiskHedge has really taken off...
SM: Yes, it’s been great. And we’re at the point now where readers are asking me for more and more. Much more than I can provide in a once-a-week, free letter.
RiskHedge reader Peter recently wrote me:
“Stephen, I read your article on Xilinx from December 2018. Very clear and well written. The stock has now reached the initial $130 target. Are you going to update your article soon?”
As readers may remember, I recommended 5G chip maker Xilinx (XLNX) back in December. The stock is up 35% since then. But as Peter said, we haven’t had a chance to revisit Xilinx. Should you take profits, or keep riding it higher?
Frankly, it felt wrong to dedicate a whole second issue to Xilinx when there are so many other important disruptive trends readers need to know about.
DS: As we talk, I’m scrolling through dozens of notes from subscribers asking you to create a portfolio of disruptive stocks. They want clear buy instructions and clear sell instructions, so they know when to lock in profits. They want ongoing guidance.
SM: That’s exactly why I’ve created Disruption Investor.
DS: For folks who don’t know, Disruption Investor is your new premium investing service. Tell us about it.
SM: In Disruption Investor I hunt for stocks that are changing the world. Ones that, according to my research, are primed to hand us big profits as they disrupt whole industries.
DS: We should be clear that you’ll focus on safe, larger disruptive stocks—not small startups.
Right. I won’t be recommending tiny “early-stage disruptor” stocks. That’s my colleague Chris Wood’s expertise. My Disruption Investor team and I hunt for established, safe disruptors.
DS: Give us some examples.
SM: Subscribers can expect the kinds of disruptor stocks I’ve been writing about in the RiskHedge Report. In the last couple months, we’ve collected 115% profits on advertising disruptor The Trade Desk (TTD)... 30% on TV disruptor Disney (DIS)... 83% profits in data disruptor Alteryx... and 30% in 5G disruptor Qualcomm (QCOM), to name a few.
And keep in mind, that’s with the limited resources of a free, once-a-week letter. Which, as I’m sure readers realize, only allows us to go so “deep.”
DS: Now’s a good time to address what many readers are probably thinking. Your weekly RiskHedge Report has been free, and many people don’t like when something goes from free to not free...
SM: You and I have spent hours talking about how to best address this. I think we came up with something that should make everyone happy.
We’ve decided to give current RiskHedge readers a very special opportunity to claim a “Founder’s Subscription” to Disruption Investor. What this means is they’ll pay just $49 for a whole year—far less than the $199 others will pay.
Our goal with this Founder’s arrangement is to offer a deal that’s so attractive it’s a no-brainer. Given that a Founder’s subscription will cost less than 15 cents a day, I think we achieved that.
Also, I want to be clear that my weekly RiskHedge Report will remain free. I’ll continue to send it to readers every Thursday afternoon.
The big change is Disruption Investor will now be home for all my stock recommendations.
DS: Can you talk about your first Disruption Investor stock recommendation?
SM: Readers should go here to get the full details, but here’s the gist. As you know I’m no fan of Netflix (NFLX) stock. I warned about its problems before it crashed 42% last year. It’s since bounced back, but I still wouldn’t touch it.
My first Disruption Investor recommendation is a little-known company that has Netflix by the throat. Its profits are surging, and it’s rapidly stealing market share from a much, much bigger rival. My research shows its set to hand us big gains of 200%, 300% or more over time.
DS: Readers can review your case for this stock—which you’re calling Netflix’s Worst Nightmare—right here. Anything else they should know?
SM: Just that I really appreciate all the support over the past year, and I’m excited to take this next step. Also, we’re only ever offering Founder’s Subscriptions this one time, and the window to claim one won’t be open long. So anyone who’s interested should go here now to review all the details.