Cocktail Investing

Cocktail Investing takes a look at investing in a different, catalyst-driven light to form a more cohesive, globally relevant investing lens. With a focus on the intersection of economics, demographics, psychographics, technology, policy, and more, this book helps readers build a more profitable portfolio based on what they see everyday rather than following the herd on Wall Street. Industry experts expose the actionable, observable, and recognizable trends that surround us daily, and show readers how to recognize these trends for themselves and translate them into wiser investing decisions without getting sidetracked by media clutter and bad advice.

Given today's ever-increasing deluge of information, the average investor faces the challenge of sorting through the babble to decipher what it means, and learn how, where, and why they should be investing given the current economic environment and the uncertain future. This book provides an 'off' switch, helping readers apply an automatic mental filter to the incoming cacophony, to filter out only what they can use for smarter money moves.

• Read the economy like a professional investor
• Filter out useless and misleading data
• Recognize 'go' signals, and identify the beneficiaries
• Identify cyclical and structural changes that have reshaped business models

The economic climate has changed drastically, and traditional practices are no longer getting results. Modern investing requires a whole new approach, and Cocktail Investing is the clear, insightful guide for putting it into action.

Preface ix

Acknowledgments xv

Chapter 1: Money 1

Chapter 2: Getting Started 19

Chapter 3: The Economy versus the Markets 35

Chapter 4: Read the Economy Like a Pro 53

Chapter 5: The Impact of Politics and Regulation on Investing 97

Chapter 6: Enabling and Disruptive Technologies 119

Chapter 7: Profiting from Pain 143

Chapter 8: Cocktail Thematic Investing 179

Chapter 9: Designing Your Portfolio 197

Chapter 10: Choosing Your Investments 223

Chapter 11: Building the Portfolio 267

Appendix: Definitions, Metrics, and Resources 301

About the Authors 323

Index 327

CHRISTOPHER J. VERSACE, widely known as The Thematic Investor, is a founding partner of Tematica Research and editor of the Tematica Investing and Tematica Trading publications. He is also the co-manager of the Growth Seeker portfolio with Lenore Hawkins and fundamental detective for Trifecta Stocks, both at TheStreet. He is also a contributor to TheStreet and Forbes.com, and regularly shares his investing and thematic insights on national radio and television programs.

LENORE ELLE HAWKINS is a founding partner at Meritas Advisors, where she's the firm's chief investment strategist, and focuses on macroeconomic influences. She is co-portfolio manager of the Growth Seeker portfolio with Christopher Versace at TheStreet. She shares her unique insights as a frequent guest on a variety of national and international radio and television shows as well as at investing and economic conferences throughout the world.

INVESTING CAN BE INTOXICATING—IF DONE RIGHT.

Insiders know that the investing world looks nothing like what it did just a few decades ago, yet many investors, including professionals, are still using the same strategies. On top of that, the individual investor planning for his or her family's financial security is up against tremendous challenges. An overabundance of information and misinformation, all-too-frequent sensationalized headlines, and markets that can change direction simply based on the comments of a politician or bureaucrat merely drunk on power, can make all investment decisions even harder. Cocktail Investing shows you how to make top shelf investments by finding the intersection of changing economics, demographics, psychographics, technology, and public policy to create investible opportunities, such as:

• Tectonic shifts in populations, income levels, and age distributions across the globe that are fermenting new opportunities
• A looming retirement crisis due to increasing life expectancy and an aging population where too many have saved too little
• A rapidly growing middle class in emerging markets and a shrinking middle class in developing economies
• The rising standards of living across the globe, leading to unprecedented demand for already limited and in some cases scarce resources
• Rapidly evolving technologies affecting everything about how, where, and when we work, play, and interact with each other
• Cyber attacks, hacks, and identity theft spurred on by the increasingly digital and connected lifestyle
• Physical currencies that are increasingly being replaced by digital and mobile payments, and even cryptocurrencies, threatening the privacy of cash, and introducing enormous new opportunities for theft
• Large companies in industries that barely existed more than a decade ago that are in the process of disrupting the way we do almost everything in our day-to-day lives