Kim Bolton, president & portfolio manager at Black Swan Dexteritas, shares his outlook on Technology Stocks.

Kim Bolton, President & Portfolio Manager, Black Swan Dexteritas

Focus: Technology stocks

Top picks: Honeywell, Palantir, Uber

MARKET OUTLOOK:

In August, global financial markets gained as investors positioned for potential interest rate cuts and steady inflation data, supporting a more constructive outlook for the second half of the year. Equity gains were led by small caps, technology, and emerging markets, as many companies reported strong earnings with limited negative impact from tariffs.

Interest rates were mixed: shorter-dated yields declined while longer-dated yields posted a modest increase, leading to a steeper yield curve as the U.S. dollar weakened against most major currencies. In the past month, the BSD team held a relatively low short equity hedge (between 10 per cent and 20 per cent of the stock portfolio’s notional value), we’ve hedged our American/Canadian dollar foreign exchange exposure and lightened up on our software holdings.

We are still cautious going into the fall season, which is historically volatile and susceptible to equity corrections. Our BSD Global Tech Hedge Fund has a two per cent cash position, and a stock portfolio that is 98 per cent invested across a multiple tech vendors and tech end users, together with a 15 per cent short equity hedge that will incrementally grow (from our laddered Nasdaq put options strategy), if the stock market deteriorates. We expect the fourth calendar quarter to bring renewed appetite for the technology sector.

Despite rising tariffs, the catalyst will be a strong third quarter earnings season reporting positive surprises, driven by resilient enterprise and consumer demand, and huge AI spending. Your BSD Team is proud to be your investment ‘eyes and ears’ in the technology arena.

TOP PICKS:

Kim Bolton’s Top Picks: Honeywell, Palantir & Uber Kim Bolton, president & portfolio manager at Black Swan Dexteritas, shares his top stock picks to watch in the market.

Honeywell (HON NASD)

Honeywell International Inc. is a leading American multinational conglomerate headquartered in Charlotte, North Carolina, with approximately 102,000 employees as of 2024. Established in 1906 and shaped through the merger of Honeywell Inc. with AlliedSignal in 1999, it now forms part of the Nasdaq–100 and the S&P 500 indexes.

Palantir (PLTR NASD)

Palantir provides two data analytic platforms – Gotham and Foundry – that help organizations operationalize disparate data to enable better decision making. The company provides a unique data fabric which integrates different types of data (text, video, machine data etc.) into a usable format, which helps surface dependencies.

Connecting data and mapping dependencies, Palantir is then able to apply machine learning and artificial intelligence on top of that data, enabling technical and nontechnical users to simulate scenarios in an easy-to-use interface to make more informed data driven decisions.

Uber (UBER NYSE)

Uber Technologies, Inc. is an American multinational technology platform that enables a variety of on-demand services, including ride-hailing, food delivery, freight logistics, and courier services. It is headquartered in San Francisco, California, and operates across roughly 70 countries and 15,000+ cities worldwide.

As of this year’s second quarter, Uber facilitated approximately 36 million trips and delivery orders per day, contributing to a total of 64 billion since its founding in 2010.

DISCLOSUREPERSONALFAMILYPORTFOLIO/FUNDHON NASDYYYPLTR NASDYYYUBER NYSEYYY

PAST PICKS: SEPTEMBER 25, 2024

Kim Bolton’s Past Picks: IBM, Cadence Design Systems & Electronic Arts Kim Bolton, president & portfolio manager at Black Swan Dexteritas, discusses his past stock picks and how they’re doing in the market today.

IBM (IBM NYSE)

Then: US$221.23

Now: US$259.83

Return: 17%

Total Return: 21%

Cadence Design Systems (CDNS NASD)

Then: US$271.80

Now: US$328.43

Return: 21%

Total Return: 21%

Electronic Arts (EA NASD)

Then: US$141.48

Now: US$168.78

Return: 19%

Total Return: 20%

Total Return Average: 21%

DISCLOSUREPERSONALFAMILYPORTFOLIO/FUNDIBM NYSEYYYCDNS NASDYNYEA NASDYNY