There seems to be a new understanding that the market can’t go down anymore because there’s a whole new class of retail investors that are willing and able to prop up the market forever.
Well, it is true that retail investors make up a larger percentage of market participants than they have in a long time.
But it’s just ridiculous to think that these investors and traders are able to keep the market afloat all by themselves. These are largely inexperienced folks who don’t really know what they’re doing, and they’ve only been able to bull stocks up because the real big money — the institutions — are also bullish.
If we had institutions turn bearish because of higher interest rates or geopolitical problems, for example, then those retail investors surely wouldn’t last very long in the markets.
So, don’t buy into the idea that markets can’t go down. They can, and eventually they will.
But when that time comes, there are strategies you can use to protect your portfolio, and that’s what I want to talk to you about today.
The Market Agnostic Stock to Buy Now
One of the best ways to ensure your success during a rocky market is to invest in companies that are what I call “market agnostic.” These are companies that can perform well regardless of what the market is doing.
For example, Ault Global Holdings, Inc. (DPW) is a holding company that owns a fascinating portfolio of businesses.
First, they have a defense subsidiary that is doing business in the United States, the United Kingdom and Israel. They have components on nearly every ship in the British navy and a bunch more in the Australian navy.
They’re also doing business with the usual military contractors like Northrop Grumman Corporation (NOC), The Boeing Company (BA), Lockheed Martin Corporation (LMT), Raytheon Technologies Corporation (RTX) and others.
They also have a company called Digital Power Lending, which is basically like a business development company. They make loans to small to mid-market companies with lots of equity kickers involved, and this is an area where I think they have the ability to grow this business at a high rate over the next few years.
But the hidden gem here is that they have a 60,000 square foot data center in Michigan, where electricity costs are low, in which they are actually doing some cryptocurrency mining. That’s starting to bring in some revenue and profits, as many cryptocurrency prices remain elevated.
I’m not a huge fan of cryptocurrency, but if they can make some extra money from these operations, then more power to them.
A Great Deal on a Great Collection of Businesses
So, this is a pretty cool collection of businesses, and I think there are plenty of opportunities to unlock more value here. They are looking at taking the defense business public as well as the power solutions business to monetize those assets over the next few years.
The best part about Ault Global Holdings, Inc. is that it’s flying way under the radars of Wall Street analysts, and investors are only paying about 60% of book value for this collection of businesses.
I see a lot of ways to unlock value, management owns a lot of the stock, it’s likely to perform regardless of what the market is doing and I think it should be trading two or three times higher than the current stock price.
So, with all of that said, I think Ault Global Holdings, Inc., with its great collection of businesses, is worth considering for your long-term portfolio.
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