How To Manage Risk In A Bear Market

At Porter & Co. we are determined to be your best source of investing, economic, and financial insight, and your first choice for information about what to do with your money… in the entire world, bar none.

This is Porter & Co.’s Sunday Investment Chronicles. Every week, the Porter & Co. research team pores over thousands (and thousands) of articles, reports, social media posts, analyses, regulatory filings, and anything else we can get our hands (and eyes) on to understand what’s happening in the world of investing and finance – and to uncover the most original, compelling, and double-head-fake ideas…

… and we curate the best of those here. We do it all the old fashioned way: Hours of reading and brainpower (no AI curation here). We read everything – for you.

In Case You Missed It

In Monday’s Daily Journal, Porter gave a lesson in buying what no one else wants. He wrote:

Ten years ago, in the summer of 2015 (July 24), I promised investors that if they bought 10 gold stocks and held them for 10 years, they were guaranteed to beat the S&P 500. That might not sound like a big deal, but the S&P 500 has been on such a huge run that out of all actively managed mutual funds, only 20 have beaten the S&P 500 over the last decade.”

How’d the 10 gold stocks end up? 

Even so, the 10 gold stocks I recommended in the summer of 2015 have now appreciated 171.5% (on average) versus 171.4% for the S&P 500… It will be interesting to see where it ends up by July.”

He went on to explain that now that same opportunity exists not in gold, but in biotech.

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On Wednesday, Porter arrived with an invitation. 

Have you ever had that experience, an incredible flash of insight, when you were suddenly sure that your life was going to change forever? 

I’m inviting you to join me for a moment like that next month in Richmond, Virginia. Imagine 50 years ago someone invited you to Omaha, Nebraska, to have dinner and then to attend the annual meeting of a little-known insurance company, Berkshire Hathaway. Would you have gone? Imagine someone trying to explain to you that Berkshire wasn’t a textile company anymore (not really anyways) and that it was becoming the very best property and casualty insurance (P&C) company in the world. 

Would you have believed them?”

Porter detailed that by investing in property-and-casualty insurance businesses, Warren Buffett has beaten every mutual fund in the world over the last 50 years, concluding…

And that’s why I’m inviting you to join me for dinner on May 21! I want a chance, in person, to explain everything I know about this industry and what you should be looking for as an investor in the space.”

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In Thursday’s Big Secret On Wall Street, we shared a simple strategy for making a fortune in a distressed market… very safely. The issue covers a topic that we have not focused on much at Porter & Co. It explains a strategy of selling puts for making big profits in distressed-equity markets. We will be exploring more such trading strategies and techniques in Porter & Co.’s Trading Club, which we will be launching in the coming months.

Also on Thursday, Marty Fridson released Distressed Investing, his monthly market report and portfolio update, in which he said:

Reviewing recent events, my former Merrill Lynch colleague Tom Sowanick noted that the U.S. now has the potential for three fives – a 5% unemployment rate, a 5% inflation rate, and a 5% yield on the benchmark 10-year Treasury. A combination of the first two, along with slow economic growth, could qualify the economy for what’s known as stagflation. That term, derived from a combination of stagnation and inflation, signifies a worst of all worlds in which inflation remains hot despite the widespread expectation that depressed demand in a sluggish economy will cool it down. Sowanick sees inflation potentially heating up as the dollar weakens and the new tariffs lead to price increases instead of being absorbed by exporters to the U.S.”   

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And on Friday in the Daily Journal, Porter wrote the following…

The more the U.S. borrows, the larger the world’s banking system grows. The result is more money being created. This never-ending spiral of debt and inflation – boom, bust, and bailout – has enabled a tiny cadre of government-connected, financial elites (Goldman Sachs, BlackRock, Apollo Global Management) to amass massive amounts of wealth and power, all funded by enormous leverage that couldn’t exist without the government’s explicit support. 

But, not for long. 

There’s a new sheriff in town – and he’s targeting the globalist cabal that’s rigged the economy for Wall Street and foreign powers. His plan? 

Destroy the dollar-based, global financial system by breaking the links to other countries through tariffs. 

And if he succeeds? 

By 2026, the fallout will be brutal.”

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We also released this week the newest episode of the Black Label Podcast – a provocative, no-holds-barred space where Porter and co-host Aaron Brabham talk about markets, politics, and life with a series of very special guests.

This month’s special guest is Porter & Co. Biotech Frontiers editor Erez Kalir. Erez discusses what he finds curious about Trump’s policies and what in particular he sees as having a profound effect on the U.S. economy. Plus Erez and Porter talk about how they met. And of course they share the latest news on biotech… Click here to get the full podcast now.

The Best Things We Read Last Week

Out of the hundreds of sources of investment, finance, and economics news and insight we regularly review – our Bloomberg terminal, hedge-fund letters, annual reports, the financial news media, Securities and Exchange Commission (“SEC”) filings, investment newsletters, newspapers, X (Twitter) threads, conferences, podcasts, and more – here’s what we’ve read that we think you might find interesting.