Alternative Investing Report - November 21, 2024

*as of 11/20, Sources: S&P, BTC, FTSE, DJRE, CL50

For the first time since before the pandemic, the U.S. housing market is slowly becoming a buyer’s market as higher mortgage rates stifle demand and competition and inventory remains on the rise. Realtor.com data showed that new listings are up 4.9% year-over-year and the median home price actually declined in October. Meanwhile, Zillow’s Market Heat Index also showed a number of metros becoming buyer’s markets, particularly in Florida and the South. Home prices only increased in October in one of the top 50 metros - New York City.

➨ TAKEAWAY: Both Zillow and Realtor.com also looked at the most affordable markets for median-income households, and Pittsburgh topped both lists, with Detroit and St. Louis also placing high. Even though mortgage rates are still hovering at 7%, expect buyer demand to pick up with no more election uncertainty holding people back. For those who can afford to buy, now might be the time to start looking.

Interested in investing in private companies? Join us on Tuesday, December 3 at 11 AM ET to learn all about OpenAI, the American AI giant. Vincent CEO Eric Cantor and Jan-Erik Asplund, Pre-IPO analyst at Sacra, will dig into the company’s growth, strengths, challenges, IPO prospects, and answer investor questions.

The Hiive50 Index, an equal-weight price index of the 50 most liquid securities on the pre-IPO trading platform Hiive, is now up around 25% from its October 2023 lows. AI-related companies Lightmatter (+197.6% in the last 3 months), xAI (+89.9%) and OpenAI (+62.3%) are leading the way, with SpaceX (+141.5%) also seeing a big jump in price. The two best performing sectors are AI and Web3, mirroring VC funding trends.

➨ TAKEAWAY: With more big-name companies staying private, demand for shares in the secondary market keeps growing, and as a result, liquidity is increasing and the bid/ask spreads are narrowing. Now, more than ever, retail investors can access shares of private companies, and this is creating a more robust and efficient market.

💵 Bridgewater going retail: The hedge fund is teaming up with asset manager State Street to offer an exchange-traded fund (ETF) to retail investors that will follow the strategy of Bridgewater’s “All Weather hedge fund.

🪙 DCG announces Yuma: Barry Silbert, the CEO of Digital Currency Group, unveiled a new decentralized AI company named Yuma, which will provide capital to startups building on the Bittensor blockchain network.

🎨 Disappointing Phillips auction: Their modern and contemporary art evening sale grossed $54.1 million, below the pre-sale estimate of $60 million - $89 million. The main culprit was a Basquiat self-portrait with an estimate of $10 million - $15 million that did not end up selling.

🚀 European VC funding: Startups in Europe are on pace to raise $45 billion this year, down slightly from $47 billion in 2023, and IPOs and M&A transactions are at their lowest points in a decade.

🥪 Blackstone buys Jersey Mike’s: The alternative asset giant acquired a majority stake in the sandwich chain that is now valued at $8 billion, a reminder that not all unicorns are tech-related.

📉 Florida home sales plunge: The five metro areas that saw the biggest decline in pending home sales all came from the Sunshine State — Fort Lauderdale (-15.2% year-over-year), Miami (-14%), West Palm Beach (-13.8%), Jacksonville (-9.5%), and Tampa (-7.2%).

🪙 Bhutan Bitcoin: The tiny Asian country now holds $1.14 billion worth of Bitcoin, which is the equivalent of 39% of its GDP. As more countries accumulate Bitcoin reserves, the scarcer and more desirable it becomes.

AI voice cloning technology has improved to the degree that within minutes, anyone can clone their own voice in a manner of minutes. The issues arise when people use that technology to clone other people’s voices to get “them” to say anything at all. Scammers are increasingly using voice-cloning scams to target people with the AI-generated voices of their friends and relatives. It is also easy to see how this type of technology can be used to spread misinformation. Legendary British broadcaster David Attenborough recently said he was “profoundly disturbed” by an AI clone of his famous voice. With little to no guardrails on voice cloning, it is only going to present more of a problem going forward, and everyone needs to be vigilant that who they are hearing is actually who they are hearing.