Tuesday's Scoop: Slow🌤️

Hey friend - Welcome to 2024. We’re back to catch you up on anything you missed over the last few days.

Obligatory resolutions hype: You got this! Focus on the big dreams you can accomplish with several small, easy wins. (Want to invest more? Set up recurring transfers today.)

Secret hack: Today is the best day to break your resolutions. One day in, and it was just unrealistic. Two weeks in, and you feel like a failure. Knock out the ones that are going to make you feel bad. There’s no time for that.

Here’s what you need to know today…

1. Optimism for a mainstream debut has pushed Bitcoin prices higher.

2. Electric vehicles just got more affordable through tax credits.

3. Escalating conflict in the Middle East has disrupted global shipping.

S&P 500: 4,742.83
1Mo: +4% | 1Yr: +24% | 5Yr: +87%

The market couldn't maintain its holiday cheer into the new year. Investors took a break today after the longest weekly win streak in 20 years.

Crypto enthusiasm is back. Bitcoin’s price crossed $45,000 for the first time in almost two years as investors grew more optimistic about an upcoming regulatory approval for a Bitcoin fund that would trade on the stock market. Fourteen asset managers, including Blackrock, Fidelity, VanEck, WisdomTree, and ARK Invest, have requested to launch Bitcoin-linked funds. Reuters reported regulators could respond within days, allowing funds to launch as early as January 10th. New Bitcoin ETFs (🤓) could create massive inflows from mainstream investors for the alternative asset, pushing its price higher.

Electric vehicles just got a little more affordable. As of January 2024, the new clean vehicle tax credit is now available as an upfront rebate. That means buyers of new or used electric, hydrogen, or plug-in hybrid vehicles can earn up to $7,500 immediately instead of waiting to deduct it from their annual tax filing. So far, only 13 cars qualify due to restrictions against parts manufactured outside the United States. Still, the credit brings the average purchase price for electric vehicles below the average combustion engine, according to Cox Automotive.

Escalating conflict in the Red Sea has disrupted trade. The US Navy destroyed three boats of Iran-backed Houthi militants who had attacked ships traveling through the Red Sea, one of the world’s most important shipping lanes. Iran dispatched a warship to the area in response. The Red Sea carries 12% of the world’s trade, and shipping giant Maersk announced it will suspend travel through the area. Transportation costs have surged, but oil prices haven’t risen much in the past month.

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What is an ETF?

An ETF, or Exchange-Traded Fund, is a type of investment fund with shares that trade on stock exchanges, much like individual company shares. ETFs are often called index funds, designed to track the performance of a particular index of stocks, commodities, bonds, or other assets.

ETFs, like other types of investment funds, offer diversification. Buying a share in an ETF provides investors ownership across a portfolio of various assets, not just one individual company or commodity. Diversification helps investors limit the impact of individual poor-performing assets by spreading out the investment.

ETFs have a range of other benefits, from their reporting transparency to their efficient tax structure that gives investors more control over their profits. They also often have lower fee structures since many ETFs passively track indexes without paying expensive portfolio managers.

It’s important to know that ETFs are just an investment vehicle structure - a type of packaging for investments. The investments inside that packaging can vary widely, so make sure you know what you’re investing in before making a purchase.