New Stock Market Cycle Starting NOW
Publisher’s Note: The bulk of the wealth I’ve been able to create for myself and premium members has come from speculating early on developing market trends. We made up to 20X our money investing in electric cars before Tesla was even a stock. Last year, we made 16X our money on a biotech company that discovered COVID-fighting antibodies. And this year we’ve already made 7X our money on a real estate tech play as that sector heats up. I’ve been doing this year-in and year-out for over a decade. And now, the next trend is at hand. See my process for speculation and the next trend I see coming in the interview below.
Gerardo Del Real: Joining me today is the co-founder of Digest Publishing, my friend and business partner, Mr. Nick Hodge. Nick, it's been a bit since you and I got in front of the camera together. You have an idea that I know you're excited about, and you don't excite easily, so I thought I'd reach out and pick your brain a little bit. How are you?
Nick Hodge: I'm doing good, Gerardo. We catch up every week in the podcast, Bizarro World. But you're right. It's not often we get together face-to-face. And in this world of video, and streaming, and Zoom meetings… it was time to do that. So it's good to be with you, as well.
Gerardo Del Real: So between Digest Publishing, and Resource Stock Digest, and Daily Profit Cycle, then the Bizarro World podcast, people are pretty familiar with you. But for those that may not be familiar with you and your background, can you give us a brief primer on just how you got started in the space? And then let's get to talking about this exciting, new idea that you have.
Nick Hodge: Yeah. I've spent my entire career in the financial publishing world, going back well over a decade to the mid 2000s. I spent a lot of time on cleantech, wrote a couple of books about investing in energy, both dirty energy, as it were, and renewable energy. So I'm well versed on that side of things. That led to a natural creation of a network in the natural resources space. You don't have any energy technologies without natural resources, the raw material inputs to build those things, or to burn to create those energies.
And so I started financing resource deals, met you, founded a newsletter called Outsider Club, grew that to serve a couple hundred thousand people and generate tens of millions of revenue. And then I became, essentially, a private investor and a manager of my own wealth while simultaneously running Resource Stock Digest and Digest Publishing with you. And I've had a lot of success harnessing trends, sniffing out trends, and then investing essentially ahead of the herd in those trends. Sometimes we've been a little bit early, but ultimately I've had a lot of success in various trends over the past 10 years.
Gerardo Del Real: In true contrarian fashion, right? And I think we both would self-describe as contrarians. And that does require sometimes being a bit early, but when it pays off, it pays off spectacularly. And so before we get into this new idea that you have, tell me a bit about your process. How is what you do different from how the average newsletter writer/publisher would approach the space?
Nick Hodge: I think the primary thing is that I have experience investing in the things I write about and recommend because I have skin in the game. I see a lot of armchair gurus who are also writing about trends or identifying trends, but they’re really regurgitating information, and don't have a dog in the race. Especially in the private deals that I give to my close contacts at Hodge Family Office. These are deals I'm writing checks into.
So in that sense, I think that's what sets me apart is that if the deal doesn't work, then I lose money, as well. It's not just about a newsletter promotion. And then I think also the depth of network and the willingness to go and research is also what sets, not just me, but you apart as well, right? It's one thing to say, "Lithium is going up and there's a lot of electric vehicles being created." And then throw a dart at a wall with all the lithium stocks on them.
It's quite another to have a network that can vet not only projects — are they clay-based, are they spodumene, hard rock, brine, what are they? — but can this team do it, what are the geopolitics, and of course the share structure.
I think the results set me apart as well.
And lithium is a prime example. All the way back to 2015, financing private companies like Lithium X at 15 cents, and watching them run and ultimately get acquired in several months time for over $2.60.
We’ve financed biotech companies privately at $1.50 and watched them run to $26 when they discovered COVID-neutralizing antibodies.
Real estate has been hot, too. We financed a real estate tech deal, or a proptech — if you're hip with the jargon — deal at 20 cents, with warrants at 20 cents as well. And that ran to $1.60, if memory serves.
And so those are sort of the multiple, multiply-your-capital-several-times deals that we've been in. And really being sector agnostic and harnessing trends. Those things I just mentioned are things that are in, or that are sexy, right? Electric vehicles, biotech, real estate. This is sort of how I've made my money over the past decade and a half.
Gerardo Del Real: Is the network that you have access to, Nick, and your process in vetting companies, projects, share structures, is that why you choose to manage the bulk of your wealth on your own?
Nick Hodge: It's definitely part of it. The other part of it is that I've been able to outpace what you would traditionally get as in returns through traditional money management avenues. And you know, that's not to say you shouldn't have some professionally managed money, and that's not to say you shouldn't do things like passive invest and own index funds. But what I found is that, and you can look at cryptos as a perfect example, those traditional avenues don't give you the torque or the leverage that speculative investing gives you, especially when done right.
And just to give you a real poignant and present example, FAANG stocks and tech stocks have been all the rage for the past, I don't know, call it a half decade, or whatever. And it was easy to own that group of stocks, and outperform, and meet your benchmarks, and so money managers, I think, got lazy. And this year that's sort of got turned on its head for a while with the Nasdaq lagging, and energy and materials sort of outpacing what had been working.
I know for a fact, because I have some professionally managed money, that they don't respond in kind the way I can by managing my own money. I can quickly rotate out of the sector and into a new sector, but a professional money manager isn't going to do that. And so, I mean, pick your flavor, short squeeze stocks, meme stocks, whatever it is. Certainly well-thought-out speculations in trends, your money manager isn't doing that for you.
Gerardo Del Real: Walk us through, briefly, the different opportunities that an investor or speculator has through your services because you take different approaches for each service, and you have several letters that you publish and write.
Nick Hodge: I take different approaches because people have to take different approaches. I just mentioned investing in passive funds, and things like drips, reinvesting dividends. I do all that sort of stuff in backdoor Roths and converted Roths. And I have all that stuff set up, and I have fun doing that.
But I also have fun day trading SPACs, which I do, as well, getting in on NFT stocks, or speculating on whatever commodity is running. And so I do that, as well, and also on different timeframes, right?
So there's a monthly letter called Foundational Profits that we do the safer stuff, mega caps, large caps, and funds. And then a weekly letter called Family Office Advantage where we do more of that speculation, and maybe some shorter term trading, but definitely speculating in smaller companies.
And then of course, Hodge Family Office, which I've already mentioned, doing private deals.
I do it this way for a number of reasons. One, I think you need to diversify and employ multiple strategies to have success in the market. They say there's no free lunch, but really the only free lunch in the market is diversification, right, because there's always a bull market somewhere.
The other reason I do it is because not everybody has the time, willingness, proclivity, or capital to invest weekly or via private deals. And so there's a lot of ways to skin a cat. There's a lot of ways to invest in the market. And I cover all of those, not just for my personal wealth and my family's wealth, but via publications to serve others, as well.
Gerardo Del Real: I've known you for over half a decade now. I've seen a litany of triple digit and quadruple digit gains on a consistent basis. We could talk just 2021, right, and you've had a spectacular run. What's next? What is this idea that has you all excited, Nick?
Nick Hodge: You know, I love trends, and I love big ideas, and I love sussing out what's really happening in the market. And we talked about that with lithium. I also was able to harness the 3D printing trend and wireless electricity. I was in front of the copper boom. I mean, even going back to peak oil days, and riding the fracking boom up, and then bailing out while I watched everybody else still think fracking was going to be a darling for years to come.
I've always been in niche things over the years, blue blood, for example, harnessing blood from a limpet to use as an adjuvant in vaccine scenarios. And so, one of the things I've been looking at recently is what I'm calling “star gas”. We're in an inflation for commodities, and we're in a sort of a tech boom, and a clean tech boom. And I talked about some of the inputs that are needed for that, copper, bas metals, et cetera.
What's interesting is that there's some very specialty inputs that are needed that people don't think about, and so they are overlooked. I'll give you a couple of examples. You and I talk a lot about rare earth elements. They're rare, they're critical for clean tech, they're hard to get to, they're high-priced, and they're hard to refine. Or, Just take antimony or something, for example.
But there's another input called “star gas” or helium. I call it star gas because it's born from, similar to other elements, the deterioration of stars in outer space over the millennia. But what's so unique about star gas is that there's not a lot left of it here on earth. Because it's hard to contain, you need special geologic features. And there's a whole government component into it, where we had a strategic reserve and the government sold it down and is keeping what's left in the reserve for government purposes and not selling it to tech companies.
And it's not just clean energy that needs the star gas. I mean, tech companies need it to make fiber optic cables, the health industry needs it for MRIs, to do the super conduction needed to do the imagery. And it just goes on down the road. And so these tech giants are, I think, getting worried, and certainly have had to pay more. The prices of helium are up three to seven times, depending on where you look. It's like uranium, in that respect, in that it's tough to get pricing data. But suffice it to say, the prices are up three to seven times, and the search is on to find more of this star gas. And it's just very curious to me that all these billionaires are racing to go to space, which is where we know there is a lot of this helium.
In fact, I think Popular Mechanics quantified it once, and it was quadrillions of dollars worth of helium on the moon. And it's no secret that there's a lot of raw materials in outer space. Goldman Sachs has said that mining space is going to create the world's first trillionaire. And so anyway, like uranium in the past, like rare earths, like vanadium, like blue blood, I'm pretty hot on star gas right now. And I think that speculating on it, especially companies that can find reserves and bring them to market, is going to pay some of those multiple returns that you were mentioning.
Gerardo Del Real: You touched on what can only be described as a space race, right? It seems like the world's richest people are all competing to kind of claim their stake, and you believe, it sounds like, that star gas is a motivator for that.
Nick Hodge: I definitely think it is. And so, let's just take a step back. I don't know if you've filled up a balloon lately, Gerardo, but it's quite expensive to go to the store and fill up a balloon.
Gerardo Del Real: Yes, it is.
Nick Hodge: There were some headlines going around a couple of years ago that Party City was shutting down stores because they couldn't get access to helium. I'm not necessarily sure that was the reason they were shutting down stores, but it is true that they were having difficulty accessing helium. I mentioned MRIs, but there's other uses for star gas that make it super, super important. One is the manufacturing of semiconductor chips. Did you know, Gerardo, we're right in the middle of a semiconductor chip shortage? Have you tried to buy anything with an on switch in the past couple of months? They all have long lead times.
And I’m not saying that helium is the pinch point in the semiconductor supply chain, but it’s certainly one of them. Without helium, you don't make the semi chips.
Further down the road, I mean, sort of the holy grail for climate and humanity is cheap, clean power. And we know that nuclear does that, but you still have to mine and refine uranium. Fusion would, of course, free humanity up in energy terms, and the one really critical input you need to make fusion work is, well, star gas, or helium.
So if I had to line all these pieces up, these tech billionaires need helium for their main businesses. They've all created side projects to go to space. We know that they can get richer by mining space, if Goldman Sachs is projecting the first trillionaire to come from space. And oh, by the way, space contains these unique minerals and gases that we can use on earth to not only enrich us, but make us safer and our air cleaner.
You have all these narratives developing… Elon Musk is leaving us behind... The billionaires are going to go live in space because we trashed earth.
I'm not sure those are correct. I think the correct narrative is that we're using space as a tool to improve the earth that we live on, whether that's Starlink low Earth orbit satellites, or looking to bring back star gas.
Gerardo Del Real: You've always been great at not just identifying the trends, but also figuring out ways to monetize that trend, for the benefit of yourself, myself, and your subscribers. So if I'm looking at this big, grand idea, of star gas… How do I participate in that obviously critical trend that seems like it only has one way, right? It seems like the demand is only going one way. And it seems like the supply is finite.
Nick Hodge: It's similar to how I've invested in other trends along the way. You identify early stage startups that are in need of funding, and you try to finance them privately, or early in their life cycles. And then, in the open market, you speculate on the same thing — quality companies that are in a position to harness this trend and to exploit the asset, in this case helium, at the heart of that trend.
You know, there's not a lot of companies out there. We talked about the various tiers of newsletters, right? It's not like there's a star gas passive investment fund. You can't go out there and buy a basket of helium companies.
So you've got to actually do the legwork, leverage that network that I talked about, and come up with quality companies that you can invest your speculative capital in to harness the trend. And that's what we do at Family Office Advantage, which I mentioned. And that's where you would learn more about the star gas opportunities that I have lined up. I put together a full video on that. Basically, all about the star gas market, the space race, why it's so valuable, and the best way, at least I see, to play this coming trend. So you’ll want to be sure to check that out.
Gerardo Del Real: I've seen it. It's fascinating. It's again, a clear trend. It's always exciting to me to see you excited about a new, big idea, because this isn't something that happens every week, or every month, or even every year. But when you clue in, you do a phenomenal job, so I'm looking forward to you being able to share the video with everybody.
Nick Hodge: I appreciate it. I appreciate you letting me tell some of your readers about it. And yeah, trends like this are exciting. They can last a long time, multiple opportunities develop, and it always seems to be advantageous to get in earlier than later, so that's why we put this video together now. And so, if you're interested in helium investing or star gas, please do check it out.
Gerardo Del Real: Fantastic. Ladies and gentlemen, Mr. Nick Hodge. Thank you.
Nick Hodge: Thanks Gerardo.
I hope you learned a bit about the developing star gas trend and why it’s so valuable. I’ve used previous trends like this to make millions. And I don’t think star gas will be any different.
Call it like you see it,
Editor, Daily Profit Cycle
Nick Hodge is the co-owner and publisher of Daily Profit Cycle and Resource Stock Digest. He's also the founder of Hodge Family Office, the umbrella organization for his three premium services: Foundational Profits, Family Office Advantage, and Hodge Family Office . He specializes in private placements and speculations in early stage ventures, and has raised tens of millions of dollars of investment capital for resource, energy, cannabis, and medical technology companies. Co-author of two best-selling investment books, including Energy Investing for Dummies, his insights have been shared on news programs and in magazines and newspapers around the world.
*Follow Nick on Twitter.