A Love Story That Could Make You Money for the Next Two Decades

We're becoming less social… How will couples meet in the future?... Doc's favorite 'love' stock… 'An epidemic of loneliness'… China and India's gender imbalances… A massive global trend… There's still time to profit…

The classic romance stories of the past are dying...

If you're in a relationship, or have been at any point in your life, you might have been part of the type of romantic story I'm talking about...

Maybe you and your partner met at a grocery store and were both eyeing the last loaf of bread. What started as a chance encounter with a stranger – and a foot race to grab that last loaf – quickly turned into plans for a first date.

From there, the rest is history... Your grandchildren know this story. Heck, you still chuckle anytime you tell it.

Or maybe you saw one another from across the room at a local dance. You both felt sparks right away... But you didn't catch her name or phone number. Luckily, you knew one of her friends. After weeks of backchanneling, you two finally connect... And that led to 50 years of marriage.

These are the stories Hollywood writes romantic movies about. But the world – and the scripts to these love stories – are changing.

I (Jeff Havenstein) recently went to a bachelor party in Austin, Texas...

As you might've heard, the food is amazing. And the city was full of life. My friends and I had a great time. But it wasn't the brisket that stood out most from the trip...

One morning, while we were all at breakfast, one of my friends asked me how my wife and I met. I told the story...

We met through my sister at a dinner with a bunch of mutual friends at a little Italian restaurant... where we basically ignored each other until we had no other option but to talk. (My wife always jokes that at first, I was more interested in my chicken parmesan then her.)

Then I asked the rest of the guys their stories – at the time, all my friends were in long-term relationships.

I was prepared for some interesting tales. After all, if you met my friends, they all have interesting personalities...

But I was disappointed.

One of my best friends told me how he met his fiancée in college. They were in the same classes for nearly two years, and he always wanted to talk to her. But the timing was never right (so he says). Eventually, he did talk to her...

Just not in person. He messaged her on Facebook (FB). They messaged back and forth for a while (even though they saw each other in class every day), and that "discussion" eventually led to a first date... Which eventually led to a relationship.

Not exactly Romeo & Juliet.

Each of my next four friends shared that he met his significant other through a dating app. The most popular was the location-based dating app, Tinder.

I hoped that the last of my friends would share a more interesting story. I thought there was a good chance since we went to high school together, and the person he was dating also went to our high school.

I was interested because they never talked in high school. They didn't even know the other existed. So I knew it had to be an entertaining story...

Yet, I was disappointed... once again.

They met on Tinder, too.

People just don't connect the same way they used to...

The numbers prove it.

Below you can see how dating dramatically changed from 1995 to 2017...

As you can see, online dating basically didn't exist in the 1990s. Now it dominates the industry. And it's only going to become more common moving forward.

Dating company eHarmony predicts that by 2040, 70% of all relationships will start from online dating. I'm willing to bet the percentage will be higher...

Think about it... Given the technology-driven world we live in today, how will couples meet in the future?

Will couples meet through friends?

I hate to say it... but we're becoming less social. We're buried in our smartphones, and we have less genuine and meaningful conversations with one another. That means we're developing less genuine and meaningful relationships.

As you can see below, texting is now the preferred method of communication among 13- to 17-year-olds...

In 10 years, in-person communication could very well be last on this list. And according to a study by Common Sense, a nonprofit organization that aims to help kids positively interact media and technology, over 40% of social media users ages 13 to 17 admit that social media has taken away time they could be spending with friends in person.

That's scary.

The friends we do have are Facebook friends and Instagram followers. While social media networks have their benefits, they also undermine "real" in-person social connections...

So meeting through friends? Good luck, unless it's in a group chat.

Will couples meet at school or at college?

Maybe... but more and more schools, especially colleges, are offering online education.

Right now, about one in six college students take all of their classes online. According to a survey by online-education company Learning House and higher education research group Aslanian Market Research, eventually one-third of all college students will take online classes only, one-third will take classes on campus, and one-third will do both.

You don't even have to leave your couch to get an education now. That means one less place to meet your future partner...

Will couples meet at work?

Let's face it... Even though most of us go into an office and are surrounded by people every day, we don't actually have to talk to them to do our job.

Rather than walk two desks down to brainstorm and solve a problem with one of your coworkers, it's much more convenient to just shoot them an e-mail.

And new companies like Slack (WORK) make face-to-face communication obsolete. One quick message on Slack will save you from, god forbid, actually talking to someone in person.

Besides, more employers are allowing employees to work remotely. One study from International Workplace Group, an office-services company, found that 70% of professionals work remotely at least one day a week. Soon about half of the U.S. workforce may be exclusively remote.

The point is, with the evolution of technology, the "old way" people used to communicate and meet is dying. So it only makes sense that over the next few decades, more and more couples will meet online, too.

Now, online dating is far from a new technology...

It has been around for a couple decades – pretty much as long as the Internet. But it has really only become socially acceptable to meet someone on a dating site or app over the last few years.

A few years ago, if I asked my friend how he met his wife and his response was "dating site," he would probably be blushing and a little embarrassed. Using the Internet for dating still had a stigma attached to it.

Not anymore. Now it's the norm...

If you don't believe me, ask your 21-year-old intern how they met their significant other. Ask your grandchildren or your neighbors' children... My guess is the majority of their answers will be the same as my friends' responses during the bachelor party in Austin.

My boss, Dr. David "Doc" Eifrig, was well ahead of the curve on online dating...

You see, when it comes to dating products, one company dominates the market.

I'm talking about Match Group (MTCH). This company owns many of the most popular dating sites and apps like its namesake Match.com, Tinder (which has grown its average users by 150% over the last two years), PlentyOfFish, and Hinge.

Doc issued a buy recommendation on Match Group in his Retirement Millionaire newsletter in December 2017, despite it being a risky play at the time. Match was a heavily shorted stock with 16% of outstanding shares positioned as shorts.

But Doc knew that the upside for the company and the online dating industry far outweighed the risks.

As he wrote then...

Part of the reason why Match Group's stock is soaring this year is because of its ability to monetize its services.

In the tech world over the past few years, valuations have soared on companies that make little to no money. Companies like Snap (SNAP)...

Match is not one of these "many users, no sales" companies. It knows how to make money. While people want everything on the Internet for free... it turns out they'll pay to find love.

We're seeing strength across all of Match's products. Its total PMC ["paid member count"] is up 18% year over year. This has led to a 19% increase in revenues since last year... And this is just the beginning.

Doc couldn't have been more right. Revenues for Match were up 30% in 2018, and profits were up over 35%. And it hasn't showed any signs of slowing down this year... Still, investors continue to bet against it or short it with over 19 million shares short.

My condolences for anyone who made that trade...

Match Group's stock exploded 24% higher yesterday after it reported second quarter earnings...

Investors piled into Match after it, yet again, beat Wall Street expectations. And Tinder was again the main driver of growth.

The number of average subscribers for Tinder increased 39% from a year ago. And revenues for the app were up 46% for the quarter. Tinder is growing like wildfire, and Match is continuing to monetize it. And the rest of Match's products are performing well, too. Its average subscribers across all its products are up 18% for the quarter.

As you can see, Doc's subscribers have more than tripled their money on the stock...

The question now is: Can Match Group continue this run up?

A bear would say that it doesn't take much capital to start a new dating site. Barriers to entry are low. That means it might be challenging for Match to maintain its market share. And that's true.

A lot of "competitors" pop up every year...

But a lot of them fail every year... In fact, more than 90% of online dating startups fail.

In order for a dating product to be successful, it needs users. No one is signing up for a dating site that only has a handful of potential suitors. Here's the thing... You can't get new users without existing users.

It's a catch-22. And it's what gives Match an advantage. It was early and had the expertise to adapt its products to changing industry dynamics...

But let's say one app manages to catch fire and grow its subscriber base quickly. Match has a way to deal with this type of situation... Buy it. Match regularly scoops up hot dating apps and adds them to its portfolio. It's truly a beautiful business.

Now, shares of Match are much more expensive then when Doc recommended them in late 2017. Given its premium valuation, there's going to be some volatility if you're a shareholder. It's not going straight up forever, like it has the past year. But long term, Match is likely a winner.

There's a huge opportunity for dating companies. Not just in the U.S., but in the two most populated countries in the world...

Not enough people are talking about this fact: There is a massive gender imbalance problem in both China and India...

It's sad, but many men living in China and India will be unable to find wives. It's not because they're ugly or poor or don't know how to talk to girls... It's math and demographics. The numbers just don't add up.

In China, there are 34 million more men than women. By 2020, China will have 24 million single men of marrying age unable to find wives – that's more than the population of Florida.

This gender problem has escalated because of China's one-child policy, which was in place from 1979 to 2015.

Since families could only have one child, they preferred boys over girls. If you had a son, your family name would carry on.

You can see how the one-child policy had an effect on the number of baby boys in China...

The trend in India is just as bad...

In India, there are 37 million more men than women. Many parents in India prefer to have sons because they can inherit property, while families have to pay dowries when their daughters marry. Fetal ultrasounds were widely available in the 1970s and the 1980s, which led to the country being overrun with boys and men.

There's a saying in India... "May you be the mother of 100 sons." Unfortunately, it seems the advice is being taken literally.

These gender imbalances won't end anytime soon...

Take a look at this chart from the United Nations. It shows the ratio of men ages 15 to 49 and women ages 15 to 29 (considered the ideal dating age for women) in China and India...

By the late 2020s, there will be over 300 men ages 15 to 49 for every 100 women of prime dating age in China. It shows that there is going to be a large pool of both older and younger men who are unmarried vying for the same group of young women.

And look at the lighter blue line, which shows India's trend. The imbalance is projected to gradually get worse over the next few decades. By 2050, there could be 260 men to every 100 women of dating age in India.

This is an epidemic of loneliness...

Imagine growing up in a city where there are three boys for every one girl. Some boys are just going to be left out. They'll be unable to develop necessary communication skills with the opposite sex and eventually they'll be unable to find partners.

This is going to lead to a lot of lonely people.

Now, there are plenty of other problems that could arise from this enormous gender imbalance... Like a rise in violence, prostitution, sex robots... you name it. But those are discussions for another day.

The point of today's Digest is this... For certain, people around the world are turning to and will continue to rely on online dating products.

And companies like Match Group are going to benefit. Most of Match's subscriber growth came from international markets during the latest quarter...

But with a trend this powerful, there's going to be other winners...

Consider Chinese livestreaming and dating company Momo (MOMO). Momo owns the No. 1 dating app in China called Tantan (known as "China's Tinder"). Tantan has over 270 million users globally and is the world's third-largest earner after Tinder and popular U.S. app Bumble.

Tantan was recently launched in India last year. So far, it has had great success. Earlier this year, Tantan said that it has been doubling its user base every three months in India.

The stage is set for Tantan to take on Tinder in India. But you don't need to predict which app will reign supreme... Singles who use apps to look for love (or just companionship) often use more than one app at the same time. It has been my experience with my single friends – they can use three or four apps at the same time.

There's plenty to go around for these two dating giants.

You may think you have missed the run up in online dating stocks...

But that's not true.

Online dating stocks have seen fantastic gains over the last couple years, especially Match Group. But the good times aren't over. There are still opportunities for these companies to grow and deliver big returns to shareholders over time.

And, as we've shown today, a lot of the opportunity is outside the U.S.

In any case, 10 or 20 years from now, I'm guessing most everyone's love story will somehow involve an online product or messaging app.

And whether you wish people still met each other "the old fashioned way" or not, you might as well profit from this massive global trend.

Match is one of six current positions in Doc's Retirement Millionaire model portfolio alone that have delivered subscribers triple-digit gains. And it's not done yet.

What's more, as one of the analysts on Doc's research team, I can tell you we're constantly evaluating big global trends like online dating, and the companies within these burgeoning sectors that will create the next big winners.

Click here right now for more information on a subscription to Retirement Millionaire. We're getting ready to publish our newest issue next Wednesday.

New 52-week highs (as of 8/7/19): First Majestic Silver (AG), Axis Capital (AXS), Sprott Physical Gold and Silver Trust (CEF), DB Gold Double Long ETN (DGP), Equity Commonwealth (EQC), Franco-Nevada (FNV), SPDR Gold Shares (GLD), Barrick Gold (GOLD), Invesco Value Municipal Income Trust (IIM), Lundin Gold (TSX: LUG), McDonald's (MCD), Motorola Solutions (MSI), Match Group (MTCH), NovaGold Resources (NG), Nestlé (NSRGY), Nuveen Municipal Value Fund (NUV), Pan American Silver (PAAS), Polymetal (LSE: POLY), Royal Gold (RGLD), Sprott (TSX: SII), Vanguard Inflation-Protected Securities Fund (VIPSX), and Aqua America (WTR).

In today's mailbag: Our "preaching" pays off... confusion about gold and silver bullion... and kudos for Stansberry's Credit Opportunities. As always, send your notes to feedback@stansberryresearch.com. We can't provide individual investment advice, but we do read every letter.

"I've been with Stansberry for about three years now and, as much as you preach things, it is amazing how little I took to heart. Then last year happened. I took a huge hit on my portfolio. It has taken me quite a while to get the mix of investment in my portfolio right. I am not done, but I am finally on the right road.

"So, over the past 12 months, the things I've done at your continual insistence include:

1. Buying great business at very attractive prices (often prompted by you). I am very comfortable holding SBUX, KMI, DIS, INTC and keenly watching for an entry on HD. I have a larger watch of list these.

2. Holding 30-40% cash. Keeping the powder dry. Some days I think this should be bigger but there isn't anything in the portfolio I really want to liquidate any more.

3. Been scaling into precious metals and miners, which is serving its purpose well.

4. Cautiously scaling into high-payoff areas, specifically China and Cannabis. Especially Cannabis I believe has massive potential and once my small positions in these half dozen stocks shows some solid growth, this will take a more prominent position in the portfolio.

5. Leveraging Greg Diamond's excellent guidance and work filling out the missing pieces in options trading. His self-control and market assessment to determine effective option trades are A) helping hedge, and even grow, the portfolio on these swings down, B) goosing profits on positive swings and C) giving me a far better perspective on the market that has helped me NOT buy at inopportune times.

"When the markets tanked 3%, my portfolio was only down 0.7%. Today, as the markets are taking another 1% beating, my portfolio is actually UP 0.5% (combination of Greg's options, MTCH and quite a number of my holdings that don't tend to fully participate in market swings).

"I still feel I am exposed should the market get completely clobbered but I am in far better shape than a year ago and I sleep better (at least my portfolio isn't what I wake up thinking about). I wish I could take advantage of short positions but, alas, I am barred from doing so in an IRA/401K. Greg's work is helping there as my disaster hedge.

"I am bragging about your excellent work and glad I am finally heeding the guidance. You've moved my thinking to a genuine long-term pattern which has been critical. I still watch the market too closely but when I look at a market segment and know it will be substantially larger in three to five years, short-term "negative" swings become nearly irrelevant.

"I've paid my dues. Your balanced opinions have kept me focused and convinced I can get this right. Like I say, I think I will always be a work-in-progress, but my rehabilitation is well under way." – Paid-up subscriber Bill K.

"I'm a subscriber to True Wealth, Stansberry's Credit Opportunities, and Crypto Capital. Thanks for always keeping your readers up to speed. It has been very helpful to have a perspective that is more relevant and timely than my financial advisor. Your perspectives have helped me to be more at ease with the Melt Up and be prepared for the coming recession.

"My question is relating to gold and silver coins. So often industry pundits recommend holding physical coins. Why are coins so important vs bars? I've never found anything in recent history (hundred years or more) where economic and financial crisis moved people or a country back to doing business in gold or silver coins as a currency. So... Why coins vs. bullion? Look forward to your response. Have a great day!" – Paid-up subscriber Mello M.

Brill comment: We think you've misunderstood. The term "bullion" simply refers to physical gold and silver of a minimum purity. Bullion is bullion... It makes no real difference if you buy it in the form of a bar or a coin like the American Eagle, Canadian Maple Leaf, or South African Krugerrand. This differs from rare (or "numismatic") coins that can trade at huge premiums to the intrinsic value of the gold or silver they contain.

The reason most folks recommend buying bullion as coins has nothing to do with using them as currency. It's all about cost. For example, with gold trading just under $1,500, you can buy a 1-ounce American Eagle gold coin for well under $1,550. But a standard gold bar – which contains roughly 400 ounces of gold – will set you back roughly $600,000 today.

"So glad I made the move to the Stansberry's Credit Opportunities strategy. All this stock market turmoil doesn't bother me a bit. Thanks!!" – Paid-up subscriber Raymond G.

Brill comment: We're happy to hear it, Raymond, but we can't say we're surprised... We've received similar feedback from dozens of Credit Opportunities subscribers. In fact, one subscriber recently told us this strategy has not only allowed him to stop worrying about the market... it helped him retire years earlier than he ever imagined. He explains it all right here.

Regards,

Jeff Havenstein
Baltimore, Maryland
August 7, 2019