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Hi Reader, here's what you need to know for March 27th in 3:14 minutes.

💷 You could make your first million by running a high-maintenance, late-night diner and pocketing the tips. Or join us for How To Become An ISA Millionaire at 5pm UK time tomorrow, and find out how to make bank without breaking a sweat. Grab your free ticket

Today's big stories

  1. The price of cocoa hit a fresh record high this week, after Ghana looked set to lose key funding for its farmers
  2. The investing ideas you can steal from JPMorgan Private Bank, no getaway car required – Read Now
  3. Chinese battery behemoth, CATL, found a budget-friendly, low-effort way to make a trip to the US

The Golden Egg

The Golden Egg

What’s going on here?

Cocoa prices hit a new record high this week, as if to celebrate the season of overpriced chocolate eggs.

What does this mean?

Cocoa’s new price either means the new Willy Wonka film has sparked insatiable chocolate cravings, or that investors reckon supply is about to run low. See, like most commodities, the price of cocoa is determined by the futures market, where investors trade contracts that bind them to buying or selling cocoa beans at a set price on a future date. Those futures prices have tripled over the last year, reaching over $10,000 per metric ton this week – meaning humble cocoa beans are now more expensive than copper, the bellwether of industrial metals. That’s likely down to the news that bad weather and disease have ravaged cocoa crops in Ghana, leaving the world’s second-biggest cocoa producer without enough beans to secure the funding cocoa farmers need for the next harvest.

Why should I care?

The bigger picture: There’s magic in the trees – or there used to be.

Demand for cocoa has doubled over the past 30 years, but the industry hasn’t won enough investment to keep pace. There hasn’t been a major planting of cocoa trees in West Africa, where the vast majority of the beans are grown, since the early 2000s. At nearly 25 years old, those trees aren’t producing enough fruit and are increasingly vulnerable to drought and disease. That’s why the cocoa market is looking at the biggest gap between supply and demand in more than six decades.

For markets: Chocolate’s a luxury.

Chocolate brands will try their best to pass higher prices onto their customers, but even the sweetest-toothed shopper will have their limit when it comes to spending on snacks. That means firms like Hershey, Mondelez, and Nestlé may well need to keep prices competitive while paying more for their ingredients, sacrificing their profit margins in the process.

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Analyst Take

Four Spots Where JPMorgan Private Bank Sees Opportunities

Four Spots Where JPMorgan Private Bank Sees Opportunities

By Russell Burns, Analyst

At the end of last year, JPMorgan Private Bank published a list of key things to watch for in 2024.

The bank said that higher interest rates had upended the status quo, making certain assets attractive for the first time in over a decade.

So like any good investor, the global wealth managers recently did a quarterly review of that list to see how it’s holding up.

That’s today’s Insight: where JPMorgan Private Bank sees opportunities now.

Read or listen to the Insight here

SPONSORED BY CFA INSTITUTE

This isn’t your grandad’s portfolio

Let’s face it: crypto can no longer be classed as a “phase”.

Especially now, with even traditionally minded investors buying into the OG crypto with bitcoin spot ETFs – even if they’re more interested in hedging their portfolio than funding the digital future.

So if you can’t tell your HODLs from your FUDs and your DYORs, you might want to complete the DeFi: Introduction to Blockchain and Cryptocurrency course from CFA Institute.

You’ll get a year to work through up to 15 hours of study, at your own pace and online. By the time you complete the test, you’ll be a master of all things digital – with a shiny badge to prove it.

That includes the ins and outs of blockchain tech, the current applications and potential impacts of DeFi, financial markets, and the intersection of DeFi, traditional finance, and governance.

Stand out in an increasingly competitive finance market with a certified grip on digital assets.

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Electric Feels

Electric Feels

What’s going on here?

CATL – the world’s biggest electric vehicle (EV) battery maker – cozied up to America’s battery-powered darling, Tesla.

What does this mean?

CATL is the picture of optimism these days, believing that hot-to-the-touch geopolitical relationships will blow over, leaving the world to unite over the healing powers of green energy. So to make money from that feel-good future, the battery maker is signing deals with major US carmakers like Tesla. That will play out like its contract with Ford: CATL shares the know-how behind the battery tech, and then pockets the royalties every time Ford cranks out a battery in the US – all without the costs and admin of opening its own factories in the land of opportunity.

Why should I care?

Zooming out: Choose your partner carefully.

Mind you, this isn’t a seamless plan. The US Inflation Reduction Act is working on making the stateside EV supply chain less dependent on Chinese companies. So even if a company is tempted to partner with CATL, it’ll have to weigh up the prospect of reworking its supply chains if the rules come down hard on the Chinese battery maker. According to Morgan Stanley, that could mean CATL captures just 3% of the US market – basically zilch compared to the 35% share it’s expected to hold in Europe by 2030.

The bigger picture: Shopping local adds up.

The battery is the most expensive part of an EV. No wonder, then, that CATL’s reputation for making top-quality batteries on the cheap has won it almost half of the Chinese market and contracts with Tesla, Volkswagen, Daimler, and Toyota. In fact, SNE Research pointed out that one in three new EVs were powered by CATL's lithium-ion batteries last year. So if CATL’s kicked out of the US and carmakers can’t find a replacement for the same price, EVs may be even more expensive for companies to make – and for stateside drivers to buy.

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💬 Quote of the day

"Golf is a good walk spoiled."

– Mark Twain (an American writer and humorist)
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It's ISA time, baby

Not every savings account or investment opportunity becomes mainstream dinner conversation.

But in the UK, you can’t meet anyone this time of year without ending up in a DMC about Individual Savings Accounts (ISAs). Tantalizing, we say.

It’s no wonder they get folk talking: they let you hold cash, shares, and certain other assets without paying tax on the interest, dividends, or capital gains they earn.

So your decision isn’t so much whether to open one, it’s which type of ISA to open – cash, stocks and shares, innovative finance, or lifetime – and which company to open it with.

That’s why we put together a free guide on the ISA do’s and don’ts with IG, so you can set up the right account for you before the April deadline. It’ll help you keep up with friends’ catch-ups, too.

Read The Guide

🎯 On Our Radar

1. Olivia Colman is Hollywood’s sweetheart. She’s also underpaid because she isn’t an Oliver.

2. Governments are finding ways to make money from sustainability. You can do the same.*

3. This isn’t a Twilight movie marathon. Here’s how to watch the real-life eclipse next month.

4. AI might be savvy, but it's far from infallible. If you want to invest with the tech, make sure you do it right.**

5. Mother Nature is an artist. Bugs are beautiful – at least, up close.

**See Streetbeat's disclosures.

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💰 How To Become An ISA Millionaire: 5pm, March 27th
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📈 An Insider's Guide To Success As A Finance Professional: 5pm, May 14th
🚀 2024 Modern Investor Summit: 2pm, December 3rd

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