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The Zacks Analyst Blog Highlights UUP, XLK, VGT, EWJ and SRS
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For Immediate Release
Chicago, IL – May 10, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. ETFs recently featured in the blog include: Invesco DB US Dollar Index Bullish Fund (UUP - Free Report) , Technology Select Sector SPDR Fund (XLK - Free Report) , Vanguard Information Technology ETF (VGT - Free Report) , iShares MSCI Japan ETF (EWJ - Free Report) and ProShares UltraShort Real Estate (SRS - Free Report) .
Here are highlights from Tuesday’s Analyst Blog:
Follow Buffett & Munger with These ETFs
During the weekend, Berkshire Hathaway held its annual general meeting, where legendary investors Warren Buffett and Charlie Munger shared valuable investment insights. The company announced a remarkable $35.5 billion net profit for the first fiscal quarter, with its cash reserves exceeding $130 billion. Let's discuss some of the highlights of the meeting.
US Dollar Still King: Buffett's Confidence in Reserve Currency
Despite concerns about the debt ceiling, Warren Buffett expressed confidence in the US dollar as the reserve currency. He doesn't see any other option to replace it. This viewpoint offers an endorsement of the strength of the US dollar, despite the challenges faced by the national debt. Investors can consider ETFs that track the US dollar, such as the Invesco DB US Dollar Index Bullish Fund.
Apple: A Better Business Than Any Berkshire Owns
Buffett spoke highly of Apple, a company in which Berkshire Hathaway owns nearly 6%. He referred to Apple as "a better business than any we own" and expressed regret over selling some shares years ago. Recently, Apple came up with upbeat earnings result too. To follow Buffett's confidence in Apple, investors can look into ETFs that have significant allocations to the tech giant, such as the Technology Select Sector SPDR Fund or the Vanguard Information Technology ETF.
Japan: A Land of Opportunities?
Warren Buffett has shown interest in Japanese trading firms, specifically Mitsubishi Corp., Mitsui, Itochu Corp., Marubeni, and Sumitomo. He increased his stakes in each of these companies to 7.4% and pledged to continue seeking opportunities in Japan. Investors looking to follow Buffett's footsteps can consider the iShares MSCI Japan ETF, which offers exposure to Japanese equities. Buffett's recent trip to Japan showcases his interest in that country's investment world.
Will Pain in Commercial Real Estate Go Away Once Rates Cool?
Buffett pointed out that the commercial real estate market is beginning to experience the repercussions of high borrowing rates. He explained that the market value is primarily determined by the amount one can borrow non-recourse, and the consequences of this are now surfacing. Buffett mentioned that this mindset is prevalent among prominent real estate business players, which often leads to lenders acquiring the properties. Although they may not desire the property, banks tend to adopt a "extend and pretend" approach.
Buffett emphasized that this situation has ramifications, as individuals who previously borrowed at 2.5% are now realizing that it's unsustainable at current rates. Consequently, they end up returning the property to the entity that financed its construction. With the Fed giving signals of slowing down the rate hike momentum, the commercial real estate may bounce back over the medium term.
However, investors should be cautious with their real estate investments, if you are a fan of Buffett. For those interested in following Buffett's cautious stance, they can short the segment with products like ProShares UltraShort Real Estate.
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Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights UUP, XLK, VGT, EWJ and SRS
For Immediate Release
Chicago, IL – May 10, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. ETFs recently featured in the blog include: Invesco DB US Dollar Index Bullish Fund (UUP - Free Report) , Technology Select Sector SPDR Fund (XLK - Free Report) , Vanguard Information Technology ETF (VGT - Free Report) , iShares MSCI Japan ETF (EWJ - Free Report) and ProShares UltraShort Real Estate (SRS - Free Report) .
Here are highlights from Tuesday’s Analyst Blog:
Follow Buffett & Munger with These ETFs
During the weekend, Berkshire Hathaway held its annual general meeting, where legendary investors Warren Buffett and Charlie Munger shared valuable investment insights. The company announced a remarkable $35.5 billion net profit for the first fiscal quarter, with its cash reserves exceeding $130 billion. Let's discuss some of the highlights of the meeting.
US Dollar Still King: Buffett's Confidence in Reserve Currency
Despite concerns about the debt ceiling, Warren Buffett expressed confidence in the US dollar as the reserve currency. He doesn't see any other option to replace it. This viewpoint offers an endorsement of the strength of the US dollar, despite the challenges faced by the national debt. Investors can consider ETFs that track the US dollar, such as the Invesco DB US Dollar Index Bullish Fund.
Apple: A Better Business Than Any Berkshire Owns
Buffett spoke highly of Apple, a company in which Berkshire Hathaway owns nearly 6%. He referred to Apple as "a better business than any we own" and expressed regret over selling some shares years ago. Recently, Apple came up with upbeat earnings result too. To follow Buffett's confidence in Apple, investors can look into ETFs that have significant allocations to the tech giant, such as the Technology Select Sector SPDR Fund or the Vanguard Information Technology ETF.
Japan: A Land of Opportunities?
Warren Buffett has shown interest in Japanese trading firms, specifically Mitsubishi Corp., Mitsui, Itochu Corp., Marubeni, and Sumitomo. He increased his stakes in each of these companies to 7.4% and pledged to continue seeking opportunities in Japan. Investors looking to follow Buffett's footsteps can consider the iShares MSCI Japan ETF, which offers exposure to Japanese equities. Buffett's recent trip to Japan showcases his interest in that country's investment world.
Will Pain in Commercial Real Estate Go Away Once Rates Cool?
Buffett pointed out that the commercial real estate market is beginning to experience the repercussions of high borrowing rates. He explained that the market value is primarily determined by the amount one can borrow non-recourse, and the consequences of this are now surfacing. Buffett mentioned that this mindset is prevalent among prominent real estate business players, which often leads to lenders acquiring the properties. Although they may not desire the property, banks tend to adopt a "extend and pretend" approach.
Buffett emphasized that this situation has ramifications, as individuals who previously borrowed at 2.5% are now realizing that it's unsustainable at current rates. Consequently, they end up returning the property to the entity that financed its construction. With the Fed giving signals of slowing down the rate hike momentum, the commercial real estate may bounce back over the medium term.
However, investors should be cautious with their real estate investments, if you are a fan of Buffett. For those interested in following Buffett's cautious stance, they can short the segment with products like ProShares UltraShort Real Estate.
Want key ETF info delivered straight to your inbox?
Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.