43:55 Hi Mark, I’m struggling to reconcile how, on one hand, we see deflation as a foreseeable trend driven by technology, while on the other hand, there will be efforts to deal with the debt by inflating it away and allowing a higher target rate. How can inflationary and deflationary pressures coexist? Additionally, does this mean we will deliberately create inflation? If so, will certain businesses benefit from increased fiscal or monetary spending? Doesn’t this risk distorting capital allocation across entire sectors?

Working on a model for school on Johnson & Johnson. From a high level how would you go about forecasting revenue? I am thinking obviously to separate pharma and medical devices as they do. For pharma I would take into account the decrease in revenue from expiring patents, but how would you think about future revenues for medication in development?

Have you reduced your beta exposure due to middle east tension and the US strike? I cant sleep with all the short puts!!

Hi Mark, Why do put spreads become cheaper (lower income) and call spreads more expensive (higher income) when skew increases? Shouldn't higher skew result in higher premiums for puts? Thanks!

I noticed XLU currently has the highest put/call interest of all the SPDR Sectors (3.45). Do you see this as a bearish sentiment for XLU? Why would people be overly hedging a 'defensive' sector like XLU?

Hi Mark, Springer Nature is filing for IPO and has published their prospectus along with 3 years of FS. Would you consider doing a video on reading the prospectus of a potential investment target?

When you mentioned about the japan carry trade and rather than investing in US invest in long end, wouldnt taking on duration at the long end lead to falling prices as rates shoot high at the longer end? What am I missing here?

Hello again Mark. I got a question regarding TLT pricing, more particarly Duration vs "what the market has already priced in". Right now, the 20 and 30 yr treasury yields are around 4.10%. That is what the market is pricing in in terms of future feds funds, inflation expectations and term premium, since those are the 3 parameters that move the long end of the curve mostly. TLT has a duration of 16, meaning its price will move 16% per 1% change in the yield. Does that mean that, in order for TLT to move 16%, the long end of the curve will need to move by 1% more than what the market is already pricing in?

Kindly your opinion in COSTCO first video in applied level: Why the journal entry of recognition of rewards liabilities is Dr sales Cr accrued member rewards and not: Dr Expenses Cr accrued member rewards As here, we decreased the sales with no decreased cost of goods sold, While the JE of use of rewards is logic as here the sales was credited with the accrual rewards while there will be actual cost of goods sold. So what do you think?

We do care Professor !!

In the recent Live Market Q&A you mentioned being in banking makes sense as Fed's rate cut resulting in lower borrowing cost for banks. You also mention TLT will likely increase value in the future as the Fed will have to do QE (hence long ends rate down) to deal with the deficit. I am trying to piece together these two arguments to justify whether investing in banking makes sense. If both arguments exist, would the benefits for banking from lower money market rates (less interest expense) be offset by lower rates in the long ends (less interest income)?

1:01:10 exactly!

Hi Mark, 1. I’m curious about how the long end and short end of the yield curve react differently when interest rates change. Can you explain it a bit? 2. I saw you used synthetic on duration in your recent position. From what you ve said before, I assume you only go for synthetic when you feel that the stakes are pretty high. If you had to break down the risks associated with that bet (inflation, rate cuts, and duration) what would that be? Thanks

Hi Dr Mark. Are you a buyer of China’s broad based market through an ETF given such significant government intervention? Or are there specific North American names that you think would benefit from this? Many thanks.

I vote CRWD

I am an applied level subscriber and have watched a lot of videos. I can't thank you enough for helping me making money! 1. I have a question about the video '2 big roles' for very beginner level retail investor. When you say, 10-20 delta theta portfolio, does that mean I can fully invest me portfolio and then run the theta portfolio? I see my portfolio of $30K has dollar delta beta of $55K due to the leverage used for selling options. Isn't that too risky for someone with very low risk tolerance? 2. I have 50 FCX share. When I saw sudden bump in it's price in the day when China announced stimulus, I sold $53 call thinking that it was an over reaction. Was that a flawed reasoning? I want to be sure that I have right mindset. 3. You might ignonre this philosophical question: My 9 years old son sometimes ask me, "Dad, what is the point of having million of dollars if you don't like buying fancy staffs?' How would you answer that?

Hey Mark, do you have a price target for your risk reversal on ABR?

New wave of divorces and breakups incoming from a wave of "mischaracterizing" 😂! What I always say is - "do you want to be right or do you want to be happy?"

1. Don’t you think Tesla fan base will pump the stock in their upcoming Robotaxi event no matter what they show or say? Most likely Elon would say something to pump the prices. Why not add TSLA shorts after the event and before earnings? 2. Did you see JPM collar trade? Looks like it’s a tail risk positioning. What are your thoughts? -6020C x 1/ +5425P x 1/ -4580P x 1

I've heard you mention that they've removed some of the rigor from the CFA curriculum. I was wondering if you were referring to the entire curriculum or maybe a certain level such as level 1? If so, have Level 2 and Level 3 largely remained the same? And if level 2 and 3 aren't as rigorous, does your free 2018 content cover that rigor? Also, I know you've also mentioned a Qbank for the applied level as well. I was wondering how high up on the to-do list this was in your plans? I think it is easy to watch the videos and fool yourself into thinking you know it, but the tests do a great job at reinforcing those concepts and revealing what you actually know. Thanks.

Hey Mark, why does the theta of my portfolio change with the change of the underlying's price? For example, If I sold a 10 day TTE option for $100, would my theta not be 10, regardless of the change in underlyings price? We do care about real yields.

Hi Dr Mark, 1/ When you are invested in different currencies, how do you take profit and manage the FX risk? For instance, if your domestic currency is EUR and your profit is made in USD, do you let your USD invested and take your profits in EUR by not investing more EUR (= suspending contributions) and avoid FX conversions ? Alternatively, would you convert your USD in EUR at the spot rate ? 2/ If the US debt is going to increase to an unsustainable level, what does it mean for TLT in the future ? Would USD be ultimately worthless ? 3/ Most of your content goes far beyond the investment and CFA, it is mentorship. Would you mind story telling you’re the key part of your life so we can better benefit of your life experience ? 4/ Is it possible to have your live sessions and market outlook QnA uploaded in the app for offline watching ? Thanks

Mark, what are your thoughts on Magna in comparison to BorgWarner? They've had quite a down year, lowered guidance due to macro and partially due to Fisker's bankruptcy. However, they have a nice yield, options with some activity, and relatively higher IV which could make for some accumulation and income generation. Also, throwing out SentinelOne as a smaller cybersecurity competitor for review if needing a smaller industry player.

Hi Dr. Mark, A few questions, will try brevity. 1) I tried using the Yen as a funding currency to finance a S&P500 ETF denominated in Yen, the objective being to have the obvious S&P500 long exposure, short Yen all while minimizing my Forex risk. The issue is that those ETFs have 100% margin requirements. As I need my margin for loan purposes (some call it Smith Maneuver), I can't use synthetics. Any ideas I haven't considered to do make this happen? I've asked this one before in a live, but the chat format was a sub-optimal medium. 2) You sometimes refer to your childhood and upbringing as, let's say, less than optimal from a family point of view. Do you think that these situations may sometimes be a blessing in disguise, by forcing resilience and perseverance upon you? That's it for now. I know I've got a few others circling my cerebellum.

Hey Mark, Thoughts on Stellantis earnings and what it means for other OEMs?

The “Dockworkers Strike” segment is golden. Thanks for the laugh Mark! 😅

crowdstrike would be my vote

Any thoughts on US Steel? I've watchlisted it and might start an allocation as I think the Nippon deal has a chance of going through regardless of all the talk by Trump/Harris. It's not like Nippon buying US Steel moves the jobs out of the US, right? I'd think that could easily be written into the deal to get it through.

1:49:02 😂😂😂

Looking at the US debt situation.. do you think its time to make Dave Ramsey the president?

Dear Dr Meldrum. I am concerned we may be missing a risk factor with the long US bond.. Could you play devils advocate intellectually against the case for duration? My observations below, it is quite long feel free to skip when you read it out! Apart from your point that the Fed could change the target price stability rate to a range of 1-3%, which ironically I agree with you would be interpreted as an inflationary signal by the market- despite the fact that the lower end of this range is half of the target now (win win for the Fed?), the majority of arguments I see are either 1. That the bond market will somehow discipline the government through lower credit rating, or 2. "Recency bias" whereby the core argument is that the US interest rate used to be higher therefore we should expect mean reversion. To be brief in my rebuttle is: 1. What is the alternative (risk free asset & USD). 2. Simply cherry picking the period of "recency" - what about 2010 -2019 where deflationary concerns prevailed. Also naieve comparitive analysis ignores the impact of technology and demographics.

Could you please revisit the logic of your Tesla short? Overall, it seems like you’re aware of how the stock price moves illogically, yet you believe that your logical fundamental analysis will ultimately dictate the price action and play into your hand. Aren’t there just easier fights to win out there?

Dear Mr. Meldrum, thanks a lot for all your work, it's really starting to get me more and more passionate about markets One question that I would like to ask you regards a personal difficulty I have What would be the most efficient learning process you would recommmend? I mean, would it make sense to start from a macro level (a bit like you do in the outlook) and based on that start to form expectations on the different sectors and companies based on their sensitivities to the different economic cycles(thru studying the sector studies, for exampe)? Thanks a lot!

Have you taken a position on Microstrategy after its 10 to 1 split? Any updates on your thesis?

We carrrrrreeee! 😂 I just leave the comments to others. Thank you so much for these videos and the website. The applied series is worth every cent!

48:00

1) Palo Alto Networks for their diversity of product offerings across distinct categories within the cybersecurity space. 2a) Akamai Technologies appears not to compete as directly, so their analysis may provide more industry breadth. 2b) Either Fortinet, Zscaler or Crowdstrike if you want to contrast direct competitors to illustrate more of a potential pair trade setup vs. PANW.

I noticed you conflate successful people with wealthy people, and while they’re obviously related and wealth is a sign of success, I think reality is a lot more nuanced than wealth equals success and vice versa. Do you view this differently?

Hi Mark, could you please explain in detail how an intermarket carry trade is done? Are you betting on the curve steepening?

I care 😭

1:43

1)from whatever life experiences you have now if you would have been in your mid 20s and starting your career would your goals would have been like how can i be rich OR make as much money as possible?WHAT WOULD HAVE BEEN YOUR GOAL? 2)you once said not to read trading books as the strategy would not work now BUT can we read them to know what kind of thought process or LOGIC they have applied?WOULD THAT BE HELPFUL? 3)have you ever done trades based on gut feeling ?were you sucessful? 4)i am intrested in entrepreneurship but whenever itry to think of what problem i can solve it feels like all problems are solved there is nothing left?

Thanks Mark, we care, albeit we thought missing real yield screen was planned

it's not true that nobody cared about the screen. sometimes we're just afraid to tell you things. (just kidding XD)

I had a look at Swiss CPI, as you said came in at 1.1%, which is amongst the lowest of the major currencies, and so seems a bit of an outlier. It seems it is typically always lower... Between 2008 and 2022, there were only 2 prints higher than 1.1% and there was no print higher than 1.4%, and it spent plenty of time (maybe 3-4 years worth) in the negative. So perhaps this is just a return to normality for them, equivalent to 2% in USA. Any ideas on why it's typically so low?

Hi Mark, 1. I just wanted to thank you for all your help. I’m currently waiting for the CFA Level 3 results, still having nightmares about the "For the same duration" live sessions! 😄 2. Over the past 2.5 years, I’ve been managing a small portfolio from my company’s cash reserves. 1st year, I outperformed the S&P 500; 2nd year, I underperformed, and this year has been more or less in line with the S&P 500. Given my goal of becoming a Portfolio Manager, I’d really appreciate your advice on what the next step should be in terms of career path or job role if I pass the CFA Level 3 exam. 3. Regarding the cybersecurity sub industry, where can we vote? I would prefer CrowdStrike and perhaps as a 2nd one, SentinelOne. Thanks again for all your support!

Hi Mark, have just started your financial modelling section in the applied series, it's awesome. Could I suggest perhaps a quarterly deep dive into companies selected by members where you use your existing modelling framework to build out assumptions, revenue and cost estimates. Putting my entrepreneurs hat on you could break out each company deep dive as a standalone product (free for non-grandfathered members of course) and build out a library of these for reoccurring revenue. My guess is you're looking to create a designation of sorts that creates gravitas for holders... "Elon, I have attained the Applied level with a financial modelling badge for Tesla and GM, you could really use me"

Still can't get my head around Real Rates and BreakEven Rates, but I scrolled the last week Outlook twice after watching it all to find if I had missed FF term structure and TLT performance... As I was and still am confused with the long end yields didn't like 50 bps cut and shoot up. Is it due to inflation expectations? Why?

At 21:28 what did it mean to "head to the zero line"? Also, can you elaborate, (with the risk of being repetitive) on, "we have a technologically deflationary backdrop to economy"

Mark, here is a tough pickle: a while back, right before gold went bananas, I sold some deep OTM naked calls on Gold Miners GDX. Yup, I know, selling naked calls was dumb and I have learned my lesson. Problem is that after the massive gold run in the last 30 days, GDX has climbed up to my strike level, plus there is still plenty or time to expiration and vol has spiked so closing out the short calls is very expensive. I dont see any short term catalyst for gold to turn around any time soon, so I gotta risk-manage this trade before the short calls go deep ITM. How would YOU manage this risk?