New Constructs' Trainer: 'Major correction' ahead for stocks with shaky numbers

Money Life with Chuck Jaffe

David Trainer, founder and president at New Constructs — who put Nvidia stock in "The Danger Zone ahead of its earnings report at the end of August, just before the stock cratered — says that the market and economic conditions are changing and lower liquidity and a slowing economy "is a recipe for a major correction in a lot of individual stocks," and that companies with misleading earnings are particularly likely to be punished. That's why he put Dayforce in the Danger Zone, because it has "the most overstated earnings" in the Standard & Poor's 500. Trainer also reiterates his call on Nvidia, noting that despite the stock's recent drop, it has a lot more room to fall. John Cole Scott, president of Closed-End Fund Advisors discusses how investors in closed-funds trading at premiums can use sector-swapping to turbocharge their gains, selling funds trading at premiums to buy similar funds currently at discounts, and provides examples of how this would pay off now. Andrew Leigh, author of “How Economics Explains the World: A Short History of Humanity,” discusses how almost everything — from climate change to the instrument a child plays — is impacted by economics and how economics can therefore be used for better decision-making. And in the Market Call, George Young, co-manager of the Villere Balanced and Villere Equity funds, talks about having the patience to let long-term plays on smaller companies pay off.