Hey Subscriber,

I will make this quick and dirty--there is SO much happening in the Transformity Research land.

But first--YES we have finally finished and automated our real-time Transformity Investor Ultra Growth & Ultra Income online portfolios! All with new Buy Under prices! 

Here is the statistic our team is most proud of: so far in 2020, our Ultra Growth portfolio has generated 44 YEARS of wealth building in nine months. 

Our subscribers earning 44 years of stock market wealth building in 9 months...OK that one I'm going to remember. 

Here is the Ultra Growth Portfolio Scorecard Link (I hope!) 
 


Have Technical Issues with the Ultra Income Portfolio Scorecard--but here are the raw numbers

                                                                                                                                                                                              BUY UNDER


Important for tommorrow: We just did finish our due diligence on the latest "far UV-222nm" germicidal lighting technology that I deeply now believe for a half dozen critical reasons will become the new standard of 24/7/365 pathogen and virus germicidal technology ALL the modern world and especially in the American industries devastated by their customers fear of COVID-19 infection (and the NEXT SARS based pathogen to surely arrive in the near future). 

The catalyst for the massive demand for as rapid as possible implementation of "far UV-222nm" germicidal lighting technology is simply the 3 C’s: public places that are 1) crowded, 2) closed, 3) confined.

That means Schools, Colleges, Hospitality, Travel, Senior Living, Nursing Homes, Apartment/Condo Tower, Offices, movie theatres, live sports/music/entertainment/Broadway/Super Church events are ALL faced with YEARS of slow business recovery (especially since only 24% of Americans report they WILL take early versions of COVID-19 vaccine when available) UNLESS they can post a sign at their doorway that says
"This Facility Is 99.9% Virus + Pathogen Proof With UV Light Virus Killing Technology"  

Much more on these two potential 10-bagger microcap stocks in the late morning (I reveal them at the bottom of this update below) but this was a very busy week!

1) NASDAQ Futures are off .8% in Sunday evening trading. That will turn our Oct 2 SQQQ $30 call in the green in the morning--but then who knows. The Oracle Bytedance Tik Tok deal has been approved on the US side (great news for Fastly as forecast--everyone should now understand how Trumpian negotiations work out). Tesla has its battery day on Tuesday--we assume the "million-mile battery" tech (which has existed for at least 6 months) will be featured along with a few surprises--it's Elon after all.

And yes the QQQ has entered the 10% correction we were looking for since the end of August when Tesla/Apple "split mania" got the 15 million new <40 RobinHooders traders to trade their shares up 24% in value in 8 trading days-- aka as NUTS!

But this time instead of bouncing and quickly retaking the 50-day moving average support, the QQQ failed to reconquer 50-day which next brings the 100-day support at about 18% down into play (especially if the green line 20-day moves down to break the 50-day--a "mini" death cross formation.)

Action to Take: Our Next Hedge is to ROLL Our Oct 2 SQQQ $30 Call Options forward to the last week of November if, as I expect, the leaders of the fastest bull market in history continue to get sold in the institutional portfolio rebalancing that IS COMING from now to end of Q3.

We also now have (by my unscientific reckoning) a 90%+ chance of a contested POTUS election. As my long time friend and favorite political commentator, Peggy Noonan writes in the weekend WSJ, "Between bitter division and massive mail-in voting (60%+) a normal vote would be a miracle."

I agree. Peggy adds my real fear. "Another wrinkle. Republicans seem to prefer voting in person, and Democrats by mail. NBC News has reported that 54% of those who lean Republican plan to vote in person on Election Day, while 71% of Democrats plan to vote by mail or early. WSJ reports that in North Carolina, Democratic voters requested 53% of absentee ballots, Republicans only 15%.

Because of this, it’s possible that on election night there could be what looks like a solid margin in favor of President Trump, especially in the states that will decide the election. Again, especially if the outcome is close, we likely won’t know for days or weeks.

The waiting will require patience and trust. That’s not, as we know, the prevailing political mood. We are riven and polarized. “It is my greatest concern,” Joe Biden has said. “This president is going to try to steal this election.” Mr. Trump: “They’re trying to steal the election from the Republicans.”

Suppose, to take one scenario, the president declares himself the victor before the victor is known: “What a landslide, this is fantastic, the polls and pundits were wrong!” Maybe it will be his supporters or family members who declare victory.

And what if in the following days and weeks the count changes? What if on day five, or 10, or 30, Mr. Biden looks like the winner?

That’s the general area when things could go very wrong. “Postelection through to the inauguration, we have a real danger zone,” says Larry Sabato, the great veteran director of the University of Virginia’s Center for Politics.

There will be charges and countercharges, rumors, legal challenges. There will be stories—“My cousin saw with her own eyes bags of votes being thrown in the Ohio River.” Most dangerously there will be conspiracy theories, fed by a frenzied internet."

Oh great. 

Note: For our All-Access Members, we will also buy out-of-the-money VIX call options and SELL QQQ call options to generate additional income if the opportunity presents itself as I expect. (IF you want in on this additional option action, you can upgrade to our 2-Year ALL ACCESS membership by clicking here

Here is the chart from the LAST POTUS election debacle for context. 

The Coming Pension Portfolio Reshuffle is Here, Too

I can build a strong case that institutional rebalancing will take the QQQ lower into the end of Q3 simply because the just the five FAAMG stocks --MSFT AAPL FB AMZN GOOG/GOOGL) represent literally almost 50% of the ENTIRE 100 Stock market-cap-weighted QQQ (and 23% of the 500 stocks in the market-cap-weighted SP 500). Most institutional US/Japanese/Euro/Norwegian & Saudi pension funds have rules that preclude one stock representing more than 1-2% of their stock portfolios (which also typically must represent no more than 25%-40% of total assets under management.) 

This level of portfolio concentration--5 stocks with half the value of the QQQ--has NEVER EVER happened since the start of the QQQ in 2002--not even close. And like I said last week, in order to buy the new IPO "merchandise" big funds have to sell something to generate the cash (with cash inflows flat right now). 

Then we have the "Growth at ANY COST" IPOs epitomized by the AI enabling Snowflake IPO that priced at $120 but closed Friday at a fully diluted valuation (including 80 million stock options) of nearly $90 BILLION.  That is 150 times its projected 2021 REVENUES. That makes them worth more than 85% of the SP 500--on their first day?

Yo, I KNOW that in a negative year-over-year global recession that real 40%+ annual growth rate in 2021 is highly valued. But 150X 2021 revenue? 

There at least 5 IPOs lined up for this week--including one from my total man-crush surfer Laird Hamilton called Laird Superfood. If that one skyrockets to a higher value than our FMCI with over $140 million of 2021 sales locked in, that will be good, strangely, for FMCI. 

That's all for now...but get ready for a wild week. 

PS: For You Eager Beavers, our two low UV-222 nm pure plays are Applied UV, Inc AUVI and Lighting Science Group Corp. LSGC. 

We are passing on the much larger Acuity Brands (AYI) as this low UV-222 business is not enough to really move the AYI value needle. But they are a potential long term option play.

Here is a recent article on AYI

There is a new potential value driver to consider for AYI  – Far-UVC lighting as a retrofit product for building hygiene. Unlike conventional UVC systems, Far-UVC lighting systems can kill viruses, including SARS-CoV-2, but are still safe to use while the building is occupied. Given the sheer installed base for potential retrofits, this could provide an important spark to Acuity’s story in calendar 2021 – and the stock really could use a spark.

Plan C?

UVC lighting has been used for some time to disinfect spaces, but its use has largely been confined to areas like healthcare or mass transit where the lighting can be used at “off times” to disinfect unoccupied areas – while UVC is an effective pathogen-killer, it is also dangerous to humans, animals, and plants, with potential damage to skin, eyes, and other systems.

Recent tests of Far-UVC lighting, which operates at 207-222nm versus most UVC lights which operate at 254nm, have shown some promising results. While testing conducted by Signify (OTCPK:PHPPY) and Boston University that showed UVC could kill SARS-CoV-2 wasn’t so surprising (it was already known that UVC can kill coronaviruses), Columbia University has come out with research showing that not only can Far-UVC effectively kill coronaviruses, it can do so without harming humans, animals, or plants – opening up the possibility of installing lighting systems in all manner of commercial and institutional buildings, including offices, schools, and retail locations, not to mention healthcare facilities and public transit.

To the best of my knowledge, Acuity does not have its own internal Far-UVC technologies, but it did sign a strategic alliance with Ushio back in June to combine its lighting fixtures with Ushio’s Care222 Far-UVC module for the U.S. market. Given Acuity’s strong presence in the market, it seems like a natural partnership, and Acuity could well see significant demand for these products when they make them available later this year.

It’s hard for me to say how big this could be for Acuity. It would make sense to me for healthcare, public transit, long-term care, and possibly educational facilities to use this technology, particularly in areas like entryways, elevators, and places where people congregate (waiting areas, etc.)."

That's it for now!

Toby