There’s a lot of news this morning to cover, so we’ll be pushing parts two and three of our ROIC Investing Strategy to later emails.
Stocks are down today on fears about new travel restrictions in the U.K. in response to a new strain of coronavirus, known as N501Y, which is more contagious than earlier versions and is spreading 70% faster. While this is worrying for sure, the strain doesn’t seem to be more dangerous (as measured by hospitalizations) and many experts believe that the mutations shouldn’t change the effectiveness of the vaccines being distributed. As investors, we’ll be in a cautious “wait and see” stance when it comes to the virus’ outlook for 2021.
In other news, Jack Ma allegedly offered the Chinese government ownership in Ant Group in a November 2nd meeting in an apology of sorts after angering Beijing with a speech in October. There has been no decision made and the move clearly didn’t prevent the canceling of the Ant Group IPO. Furthermore, China followed with actions and investigations into potential regulations of Ant Group. We are watching this situation closely and would see reconciliation between Jack Ma and the CCP as beneficial for Alibaba ($BABA) stock.
This month we also saw a hack of cyber security firm FireEye ($FEYE) and many government agencies from suspected Russian hackers. We now know that the hackers also gained access to many US tech and accounting companies and that they breached security through SolarWinds ($SWI) Orion software. Cyber security stocks such as $FEYE and Crowdstrike ($CRWD) have rallied on expectations that demand for cyber security willI increase because of this. I had briefly added $CRWD to the Big Board earlier this month before taking it off (never made it into performance calculations). It continues to be an interesting that we’ll keep an eye on for a potential entry.