I’ve been a trader and investor for 44 years. I left Wall Street long ago—-once I understood that their obsolete advice is designed to profit them, not you.
Today, my firm manages around $5 billion in ETFs, and I don’t answer to anybody. I tell the truth because trying to fool investors doesn’t help them, or me.
In Daily H.E.A.T. , I show you how to Hedge against disaster, find your Edge, exploit Asymmetric opportunities, and ride major Themes before Wall Street catches on.
I’m hosting a webinar entitled “Why Covered Call ETFs Suck and What to Do Instead” (More Info Below) November 14 2-3pm. Sign Up Here
Table of Contents
H.E.A.T.
Amazon’s Robot Army Is Just the Beginning — Here’s Who Profits
The most disruptive chart in automation this year wasn’t about robots replacing jobs. It was about robots replacing job listings.
Amazon didn’t eliminate 160,000 roles — it never created them. With more than 1 million robots now deployed, Amazon’s newest warehouses ship 25% faster, with 25% fewer people, and 40% lower per-package cost. Morgan Stanley projects $9 billion in annual savings by 2030. That’s not a dystopian talking point. That’s operating leverage in real time.
This isn’t about betting on automation as an idea. It’s about owning the companies already selling into signed multi-year contracts. These aren't demos — they're deployments. What matters now is the supply chain behind the shift.
Walmart is rolling out $520 million in Symbotic systems. Target is re-architecting its backend around predictive robotics. UBS reports that 34% of warehouse operators are increasing automation budgets by 20% or more. Only 15% of warehouses are currently automated — this is still the first inning of a decade-long capex wave.
Four companies stand out not just as beneficiaries, but structurally necessary players in the automation ecosystem:
ABB: This is your scaled infrastructure play. After selling its robotics division to SoftBank for $5.4 billion, ABB is going bigger on electrification and data center power — the hidden backbone of AI and automation. Third-quarter FCF grew 32%, with a $25 billion backlog. They're not selling robots anymore. They’re wiring the grid that powers them.
FANUC: The Japanese quality leader. FANUC doesn’t need flashy partnerships or VC hype. With 21% operating margins and a pristine balance sheet, this is the brand OEMs trust for precision automation. Its ADR trades thinly, but for investors who want quality without U.S. valuation premiums, it’s a standout.
Symbotic: The speculative crown jewel — a $23 billion backlog and deep integration into Walmart’s distribution strategy. But 80% of its revenue comes from one client. This is a high-beta AI-meets-logistics bet, and the stock will move with Walmart’s expansion plans. Either it becomes the new standard or a cautionary tale. Right now, the market’s betting on the former.
Cognex: Vision infrastructure for robots. Without Cognex, a warehouse robot is just a blind forklift. With it, it can distinguish between dog food and diapers. 69% EPS growth, 21% operating margins, and a machine-vision duopoly with Japan’s Keyence. Yes, it's trading at 60x earnings — but it’s a tollbooth on every automation deployment.
This isn’t a thematic call on automation's future. It's a margin thesis on its present.
The political class will debate Universal Basic Income. Academics will write papers on job displacement. But the purchase orders are already booked, and the robots are depreciating on schedule. That’s not narrative. That’s accounting.
Amazon is budgeting $10 billion through 2027 for robotics-driven fulfillment centers. Walmart and Target are spending in lockstep. This isn’t exploratory spending — it’s infrastructure. And investors looking for alpha need to stop asking if robots will win, and start asking who’s selling the shovels in the robotics gold rush.
The robots have already won. The trade is owning the suppliers.
News vs. Noise: What’s Moving Markets Today
The Fed Stalls, and the Market Blinks
Markets sold off again Thursday, AI related names were hit hardest — This is happening alongside a deeper, more consequential signal: the Fed may not be cutting in December.
Despite 84 of 105 surveyed economists still expecting a cut at the Dec. 9–10 FOMC meeting, the data calendar and the Fed’s own commentary suggest otherwise. Vice Chair Jefferson, Barr, and others have telegraphed a “go slow” message — and Powell followed suit. With October jobs data compromised by the shutdown and CPI delayed, the sequencing of incoming releases leans hawkish. No new weakness means no new accommodation. The market, pricing in easing, may be cornered by a Fed that’s nowhere near ready to deliver it.
The risk here isn’t just no cut — it’s what happens if the Fed confirms that position while inflation prints sideways and year-end liquidity dries up. Combine that with sky-high expectations in AI, record positioning in tech, and a rate-sensitive growth complex that’s increasingly detached from cash flow, and you get real correction risk. It’s not a forecast, but it is a structural vulnerability. If the Fed holds in December and guidance stays tight, the S&P’s narrow leadership could finally crack.
So how do you position into that?
Go back to what I always say about having hedges. Here’s another idea for you. I talked about ratio spreads in a recent newsletter, here’s a twist that I try to do most days…..
Strategy Overview: 0DTE Put Ratio Spread (Daily Reset)
Basic Construction
Structure:
Sell 1 near-the-money put
Buy 2 (or more) further OTM puts
All legs expire that same day (0DTE)Objective: Create downside protection with a defined risk tail, ideally at no net cost (or slight credit).
Trigger Setup: Deploy previous day, or at market open, or into morning strength, ideally when SPX/SPY/QQQ are flat to green, and IV is relatively high.
Underlying: SPX (cash-settled), SPY, or QQQ (equity-settled).
Why It Works: The Math Behind the Structure
You collect rich premium from selling a put 0.5–1% OTM, which decays quickly intraday.
Ideally this put finishes OTM or can be scalped for profit.
2. Long 2× OTM Puts (low delta, convex payoff)
These act as cheap tail protection.
If there’s a large selloff intraday (e.g., SPY -2%), the long legs go deep ITM and deliver explosive gamma.
3. Net Cost: Near $0
The idea is to construct the spread for even or slight credit so you're not bleeding P&L on days the market stays calm.
Payoff Profile
Move | Outcome |
|---|---|
Flat / Slight Down | Spread expires worthless or you collect credit from the short put |
-0.5% to -1% | Short put goes ITM, long puts stay OTM — max loss zone (watch this) |
-2% or more | Long puts go ITM and flip the trade profitable — tail insurance triggers |
This structure loses modestly if the index drifts into the short strike and finishes there. But the break-even window is small and manageable, especially with active monitoring.
Why Use This Daily?
Gamma hedge: Covers intraday tail risk for directional or short-vol portfolios.
Portfolio overlay: Pair with long equity or short put/condor exposure.
Cheap convexity: You're constantly holding a skewed risk/reward position — 1:3 or better — without paying premium bleed.
Theta scalp: On calm days, the short put can be scalped for profit or closed early.
SPX vs. SPY vs. QQQ
Symbol | Pros | Cons |
|---|---|---|
SPX | Cash-settled, tax-efficient (60/40), high notional | Wide bid/ask, higher capital needed |
SPY | Liquid, tight spreads | Equity settled — assignment risk |
QQQ | More volatile — better skew | Riskier, less stable to model |
SPX is ideal for institutional or large-account traders. SPY/QQQ better fit small accounts or retail.
Final Take
A daily 0DTE put ratio spread is one of the few defined-risk, net-zero-cost trades that can both hedge and scalp. On calm days, it’s a theta grind. On fast down days, it’s convexity. And unlike traditional puts, the lack of premium bleed makes it viable for frequent use.
How Else I Can Help You Beat Wall Street at Its Own Game
Inside H.E.A.T. is our monthly webinar series, sign up for this month’s webinar below….
Why Covered Call ETFs Suck-And What To Do Instead
Friday November 14, 2-3PM EST |
Covered call ETFs are everywhere — and everyone thinks they’ve found a “safe” way to collect yield in a sideways market. |
The truth? |
They cap your upside, mislead investors with “yield” that’s really your own money coming back, and often trail just owning the stock by a mile. |
Join me for a brutally honest breakdown of how these funds actually work — and what you should be doing instead. |
What You’ll Learn:
🔥 Why “high yield” covered call ETFs are often just returning your own capital |
The H.E.A.T. (Hedge, Edge, Asymmetry and Theme) Formula is designed to empower investors to spot opportunities, think independently, make smarter (often contrarian) moves, and build real wealth.
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