ABOUT THIS EPISODE
Wilfred Frost welcomes back legendary investor Jim Mellon for his fourth, and typically candid and outspoken, appearance on the podcast.
Jim discusses investor fatigue with US mega-cap technology companies, noting the Magnificent 7’s 30% average drop since their June highs. He also highlights the recent struggles of SpaceX, characterising it as the "biggest short of all time", and a sign of a major tipping point for markets.
While many investors fear a renewed Iran conflict could send energy markets soaring, Jim argues the world is adapting to the risk of disruption in the Strait of Hormuz. He outlines his active trading strategy for oil and his continued bullishness on North Sea oil and gas stocks, such as Ithaca Energy, but why he has faded many of his other long positions in the oil and gas space.
He acknowledges that he has been wrong about his bullish position in the Japanese Yen, but doubles down on his call, recapping why he remains a believer that the Yen is incredibly cheap, and revealing that he has the bulk of his cash stored in the currency.
Jim also reveals that he has faded his commodity exposure to gold and silver, albeit remains constructive on gold miners; that his favourite equity market at the moment is small-cap UK stocks; and why he thinks psychedelics and food security are powerful long term themes to explore.
Jim closes by reminding listeners that "a foolish consistency is the hobgoblin of a small mind" and advises them to remain nimble and be prepared to change their minds in volatile markets, predicting cheaper buying opportunities ahead.
0:00 Intro
2:25 US tech at tipping point
7:10 Strait of Hormuz less important than feared
9:27 Long UK North Sea plays
11:38 Fading most oil & gas longs
12:39 Debt LT problem not ST
15:28 US not the only risky bond mkt
17:41 Bullish on Yen still
23:22 Gold miners over gold/silver metal
26:07 Bullish UK small caps
29:46 The case for psychedelics
32:23 Novel proteins
39:12 Broad mkts trading heavy
41:49 Cheaper entry point ahead
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