Finimize - 🚗 Tesla went big on AI

Tesla's sales fell, but the stock still rose | Japanese unions wrangled the country's biggest wage hike since 1990 |
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Hi Reader, here's what you need to know for July 4th in 3:08 minutes.

🇺🇸 July 4th might be known as stateside vacation, but we're doing our bit from across the pond. We're spending the day grillin' and chillin', but we'll be back on Friday for business as usual. Sending luck from our barbecue to yours.

Today's big stories

  1. Tesla turned the corner, and AI was in the driver’s seat
  2. The upsides (and downsides) of the world’s highest-yielding ETFs – Read Now
  3. After trade unions made their discontent known, Japan’s wages are set to rise at their highest rate in more than 30 years

Recenter Of Attention

Recenter Of Attention

What’s going on here?

Tesla’s sales fell by less than expected last quarter, but it might’ve been a big bet on energy that really brought investors around.

What does this mean?

Tesla has the biggest market share of any EV maker in the world. But true to Musk’s personal brand of tinkering with a little bit of everything, the company also has a side hustle of delivering clean energy. That business is booming these days, with data centers whirring away to keep up with AI systems. Good job, too: demand for EVs – Tesla’s main moneymaker – has been waning in the US, as drivers find their high prices too much to swallow. Last quarter could have been worse, though. Sure, Tesla sold nearly 5% fewer cars than the same time last year, but that was better than expected – and enough to help reduce the count of unsold cars. Investors took it, sending the share price up 10% after the news.

Why should I care?

Zooming in: It’s Optimus time.

Tesla’s shareholders approved Elon Musk’s historic $56 billion pay package in June. Musk was threatening to develop human-like robots outside of Tesla otherwise, so the approval will keep traders’ beady eyes locked onto the carmaker. Tesla plans to spend $10 billion on AI research this year, so expect some fireworks – including an autonomous robotaxi due to be showcased August 8th, and the Optimus robot entering limited production next year.

The bigger picture: Enter, robots.

Countries in North America, Europe, and East Asia are seeing their populations age and their birth rates decrease. So unless they can stabilize shrinking workforces, their economies will be at risk – especially as the few in-demand workers will likely ditch dangerous, dirty, and dull jobs. Musk’s robots may be welcomed one day, then, as they could prop up the mining, nuclear reactor maintenance, and chemical manufacturing industries.

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Analyst Take

The Downside Of Owning The World’s Highest-Yielding ETFs

The Downside Of Owning The World’s Highest-Yielding ETFs

What’s Going On Here?

Sure, ETFs can give you low-cost, broad access to market indexes, such as the S&P 500 or the FTSE 100 – but they can also give you exposure to certain kinds of stocks.

If you’re looking for income, for example, ETFs can give you access to a group of shares that pay dividend yields.

Here’s a look at some of the most eye-catching funds, and the things you need to know if you’re thinking about diving in.

That’s today’s Insight: the upsides (and downsides) of the world’s highest-yielding ETFs.

Read or listen to the Insight here

Bulls have horns for a reason

Change might scare some of us – but it excites plenty, too.

Case in point: when financial markets start moving as quickly as they are today, many investors take the opportunity to go against the grain or seek quick turnaround trades.

That’s where leveraged and inverse ETFs come in. The first lets traders amplify their high-conviction trades, while the latter lets traders bet on price dips without having to “short” assets. 

That means you could put a bigger bet on a market move or technical signal without accessing more capital. So if you’re a risk-tolerant trader, you’ll want to find out how to use them safely and effectively.

Our free guide with Direxion – a platform that specializes in tools for decisive investors – has the lowdown: discover how you could use leveraged and inverse ETFs to amplify your trades.

Read Now

An investor should carefully consider a Fund’s investment objective, risks, charges, and expenses before investing. A Fund’s prospectus and summary prospectus contain this and other information about the Direxion Shares. Click here to obtain a Fund’s prospectus and summary prospectus or call 866-476-7523. A Fund’s prospectus and summary prospectus should be read carefully before investing.

Leveraged and Inverse ETFs pursue daily leveraged investment objectives which means they are riskier than alternatives which do not use leverage. They seek daily goals and should not be expected to track the underlying index over periods longer than one day. They are not suitable for all investors and should be utilized only by sophisticated investors who understand leverage risk and who actively manage their investments.

Direxion Funds Risks — An investment in the Funds involves risk, including the possible loss of principal. The Funds are non-diversified and include risks associated with concentration risk which results from the Funds’ investments in a particular industry or sector and can increase volatility over time. Active and frequent trading associated with a regular rebalance of a fund can cause the price to fluctuate, therefore impacting its performance compared to other investment vehicles. For other risks including correlation, compounding, market volatility and risks specific to an industry or sector, please read the prospectus.

Direxion Shares ETF Risks — An investment in the ETFs involves risk, including the possible loss of principal. The ETFs are non-diversified and include risks associated with concentration that results from an ETF’s investments in a particular industry, sector or company, which can increase volatility. The leveraged and inverse ETF utilize derivatives, such as futures contracts and swaps which are subject to market risks that may cause their price to fluctuate over time. The leveraged and inverse ETFs do not attempt to, and should not be expected to, provide returns which are a multiple of the return of their respective index or underlying security for periods other than a single day. The leveraged and inverse ETFs may also be subject to leverage, correlation, daily compounding, market volatility and risks specific to an industry, sector or company. The non-leveraged ETFs are subject to certain risks, including imperfect index correlation and market price variance, which may decrease performance. The non-leveraged ETFs may invest in a relatively small number of issuers and, as a result, be subject to greater risk of loss with respect to its portfolio securities. The non-leveraged ETFs may experience greater fluctuation in its net asset value as compared to other investments. The non-leveraged ETFs may be appropriate for investors with a long-term investment time horizon, who primarily seek capital growth, and who are able to tolerate periods of prolonged price declines. Please read each ETF’s prospectus for a more complete description of the investment risks. There is no guarantee that an ETF will achieve its investment objective.

Distributor: Foreside Fund Services, LLC.

Pocket Liners

Pocket Liners

What’s going on here?

Japan’s trade unions secured the highest wage increase since 1990, but not everyone’s wallet is on the table.

What does this mean?

Japanese labor unions have been pushing for a major wage rise. And on Wednesday, the country’s trade union federation negotiated a 5.1% increase for the seven million workers it looks after – a substantial 10% of the total Japanese workforce. But that mainly covers bigger companies, and in Japan, small businesses make up 70% of the workforce. What’s more, the small fry that are included will be rolling out smaller pay rises. At least a chunk of those paychecks should trickle into the economy: prices have risen faster than wages lately, but this announcement means that relationship’s going to flip for the first time in four years.

Why should I care?

For markets: America's hogging the limelight.

The Bank of Japan has put its might behind the country’s currency, partly by raising interest rates to just above zero. But despite its best efforts, the yen is still on the slide. And traders doubt that another increase would make a difference. High interest rates in the US are encouraging investors to stash cash in the strong dollar, see, and that’s taking even more attention away from the yen.

The bigger picture: I’m lovin’ it.

Forget about Ps, Es, and EBITDAs: right now, the evaluation trick you’ll want to know about is the “Big Mac Index”. This method – as simple as checking the price of America’s favorite burger – can be used to check if a currency is over or undervalued. A Big Mac in Japan costs less than half the price of one in America, indicating that folk can get more bang for their buck in the country. And if you’re wondering which country has the most expensive burger, it’s Switzerland – so maybe reconsider that Swiss food tour.

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