Our May 2026 Stock Updates
Summary
DumbMoney presents a thesis centered on the strategic use of leverage and 'bucketed' capital for retail investors. DumbMoney argues that separating a portion of one's portfolio for high-risk options trading allows for aggressive moves on high-conviction ideas without risking total financial ruin. This approach was recently applied to Amazon, where DumbMoney went 'all in' on options during a market dip, a move that significantly paid off as the stock recovered. DumbMoney emphasizes that such 'home run' trades are the primary driver for becoming a top-tier investor.
Beyond specific trades, DumbMoney discusses the 'Social Arb' strategy, which involves identifying information imbalances before they become mainstream knowledge. This was the basis for a successful investment in Sphere, which DumbMoney has now exited because the thesis is widely understood. Currently, DumbMoney is focused on the 'AI super cycle,' targeting semiconductor companies, memory manufacturers, and power infrastructure providers like Bloom Energy, while maintaining a long-term bullish outlook on Robinhood and a patient stance on Canadian data center power plays.
Mentioned Stocks
Reasoning: DumbMoney went heavily into Amazon options at strike prices between $198 and $215. Currently rolling profits into new options at higher strikes, targeting a price of $300. DumbMoney remains highly confident in Amazon's role in the AI cycle.
Reasoning: DumbMoney holds AMD as part of a broader AI sector trade. While not the heaviest position in the portfolio, it is viewed as a solid component of the AI 'super trade' alongside companies like Micron.
Reasoning: DumbMoney accidentally sold the position due to margin requirements for the Amazon trade. DumbMoney regrets the sale as the stock has since rallied and remains bullish on its prospects.
Reasoning: DumbMoney bought more calls recently and wants to be 'heavier' in the stock. While near-term movement is uncertain, DumbMoney is in it for the long term (6+ months) and views current levels as a good buying opportunity.
Reasoning: DumbMoney doubled down on Bloom Energy when it dropped to $75. DumbMoney expects significant upside from future contract announcements with tech giants and considers it a core part of the AI power infrastructure trade.
Reasoning: DumbMoney has exited the position entirely. The trade was based on 'Social Arb' (information imbalance), and now that the thesis is widely known and the stock has risen 400%, DumbMoney sees no reason to stay in for fundamental reasons.
Reasoning: DumbMoney is holding the majority of the position despite a 14% loss. While there are delays in Alberta data center projects due to political pressure and weather, DumbMoney believes the long-term move of data centers to that region is inevitable.