I Cancelled My Unused Subscriptions. The Money I Saved Paid for a Tesla.

My new Tesla was burning a $511 hole in my monthly budget. So I set myself a challenge: Could I cover the cost just by getting rid of cable, Netflix and other subscriptions I didn’t need?

The financially responsible among us might cancel streaming services between seasons of their favorite shows . I tend to add new ones and forget about the old ones, doing my share to support America’s ballooning subscription economy. People pay about $273 a month for subscriptions, which is almost $200 more than they think they do, according to a 2021 survey . (Since then, services like Disney+ and Discovery+ have raised their prices further.)

But I needed to make room for the first car payment in my 41 years. I had taken the family car-shopping when our 2001 Toyota Camry, which we inherited from my wife’s grandmother, started to go. I’m not a car guy and had never once wished I’d owned a Tesla. I booked a demo drive for the Model Y because I thought our kids would get a kick out of it.

The fact that we liked the car was almost as surprising as the fact that it was cheaper than the electric Volvo, Volkswagen and Hyundai options we saw. It felt like a spaceship compared with the Camry, which has 205,000 miles, a broken tape deck and an interior stained with blue and yellow crayon.

Our new monthly payment covered a 12,000-miles-a-year lease with no down payment. Tesla estimated I would save about $100 a month from replacing gas with electric, though I would need to drive (and charge) the car to know for sure. Tesla’s app tracks my estimated savings. For now, that left us with $411 to cut from our other monthly expenses.

My wife was on board. My kids shrugged. I got out my notebook and started making a list.

Cutting the cord

My first stop was my Xfinity bill.

Somehow, it had swelled to $249 a month—basically half the price of the car. In addition to cable and internet, I’d been paying Xfinity for things like a landline because cell service can be spotty in my basement office. So long, landline. After cutting everything but internet, my bill fell to $107. I haven’t dropped a call yet.

Next were the streaming services that I’d been paying for but not watching much. Over the past few years, the only person in the house “watching” Netflix was me. And I wasn’t actually watching it. I was listening to episodes of “Seinfeld” in an earbud when I went to bed. The jokes and the rhythm of their back-and-forths were a pleasant send-off as I fell asleep.

I had joined the growing number of Americans ditching streaming services. I also broke up with BritBox, a streaming service that I’d counted on to watch Agatha Christie’s “Poirot,” as well as Apple TV+. I said goodbye to Hallmark Movies Now, which I’m not ashamed to admit I enjoyed every now and then.

Next up was AT&T .

Paying for cellphone service is like paying the water bill: something I did without protest and never really thought twice about. But I’d started to get curious about the ads I’d been seeing for low-cost services like Boost Mobile and Cricket Wireless. When we agreed to let our 13-year-old son have a phone, part of the deal was that he had to pay for and maintain the account himself. He got a plan with Mint Mobile. It has worked so well for him that we decided to give it a try.

We had been paying AT&T about $128 a month for two lines. Now, we’re paying Mint about $65. If there is a downside to making this move, I have yet to notice it.

I’m still paying for that?

Then my wife and I sat at our dining table going through the last couple months of transactions in our checking account. Seeing how much money we were wasting was painful. We were both paying for subscriptions to Canva, a graphic-design service.

We’ve also been paying for Zoom One Pro, which I probably haven’t used in more than a year. I attempted canceling SiriusXM, but they kept me around by dropping the cost by about $5 a month, which is nice because I have become obsessed with a channel dedicated to country artist and sometimes actor Dwight Yoakam.

Upon further consideration I axed subscriptions to IMDbPro and Encyclopaedia Britannica, which I’m sure I’ve used professionally, but…not for a while. Finally, I cut or got reduced rates on four of my digital subscriptions to news publications. I had been making monthly payments to them more often than I was reading them.

In the end, I was able to cut out about $358 in unnecessary bills and subscriptions. Added to the $100 in estimated gas savings, the cost dropped to $53 for a car we desperately needed.

And since the lease came with six months of free access at Tesla Superchargers, the Tesla app tells me I saved $164 by not pumping gas in January, exceeding the $100 I had estimated. In January at least, my car was free-ish.

“So I love and I hate what you did,” David Bach told me. The author of personal finance books like “Smart Couples Finish Rich” has long preached the merits of cutting out small, fixed expenses. But he’d rather have seen me invest the savings.

“If you’re already a millionaire, go enjoy the Tesla,” he said.

No regrets

It isn’t like we’ve had to revert to our DVD collection to entertain ourselves. We still have Disney+, Hulu, Max, the language-learning service Duolingo and, of course , Spotify. We get three print newspapers delivered and many more digital news subscriptions.

I’m reacquainting myself with some shows on the services I kept, like Billy Bob Thornton’s “Goliath” on Prime Video—featuring an exceptional performance from Dwight Yoakam.

It is possible we’ll start subscribing all over again. Americans resubscribe to about 23% of the larger streaming services they cut within three months. That share rises to over 40% after a year, according to Antenna, a subscription-analytics provider.

I get it. I subscribed to Paramount+ for Super Bowl Sunday (yes, I canceled it the following Tuesday). And I’m tempted to return to Netflix every time I get ready for bed. I still haven’t found a lullaby to replace “Seinfeld,” but at least I am the master of my (financial) domain.

I need something upbeat but not preachy, familiar, but with enough episodes that I don’t get too sick of them. I tried “Bob’s Burgers,” but Louise Belcher’s screams and the high-pitched strumming of the ukulele between scenes kept me awake.

Oh well. Reliable transportation is worth the $511 monthly payment. Come to think of it, that feels a lot like a subscription.

Wall Street’s hottest trade has gone ice cold.

For years, it paid off to buy stocks that were rising in price—and bet against struggling shares. The momentum trade was especially profitable this year, as investors piled into hot stocks including Micron Technology, Nvidia, Advanced Micro Devices and other artificial-intelligence darlings while wagering against those likely to be hurt by the embrace of AI.

The S&P 500 Momentum Index soared 44% in the second quarter, its best quarterly performance on record, and it surged 133% over the past five years, nearly double the broad market’s performance.

Mega funds and rookie investors alike piled into the trade, some using leverage and options contracts in an effort to amplify their returns, propelling the underlying shares higher.

“It is a self-fulfilling prophecy,” said Matthew Tym, managing director at Cantor Fitzgerald, of the trade.

Suddenly, the trade is a loser. The momentum index has tumbled more than 9% since July 1, lagging behind the S&P 500’s 2.8% gain. The index—which tracks stocks in the S&P 500 based on a “momentum score”—is on track for the biggest quarterly underperformance in 25 years. July was the second-worst month for the momentum trade in around 40 years, according to Bank of America estimates; the only month worse was April 2009, in the teeth of the global financial crisis.

Hedge funds that bought momentum shares while shorting low-momentum stocks suffered even more. At the same time, a basket of the most popular stocks held by hedge funds tracked by Goldman Sachs recorded its biggest one-month underperformance in July relative to the S&P 500 in more than 20 years, according to the bank’s analysts.

Momentum trading is based on a rather simple observation: Investments that go up tend to keep outperforming; those that underperform often remain laggards. This kind of trading might seem too simple a stock-picking strategy to work. Yet it often has.

“For decades, it didn’t take a lot of sophistication to run a momentum strategy and make a decent living at it,” says Agustin Lebron, senior researcher at EquiLibre, a trading firm.

Part of the reason: It takes a while for corporate and other information to spread to various investors, so they slowly build positions, producing buying momentum.

“A huge pension fund can’t flip around its positions in a day,” says Lebron. “Behavioral biases also account for some of the effect, as well—people tend to sell their winners too early and hold losers too long.”

Fans of the strategy point to the human tendency to extrapolate from past results—and chase investment returns—noting that momentum patterns have been evident in markets for decades, even centuries. They also say that some of the worst months for momentum strategies are during longer periods of outperformance.

Some have been doing the trade by buying the strongest investments in a sector while shorting the weakest; others lean in to rising markets or asset classes. Still others use a quantitative approach or turn to banks or others who sell ways to make distinct wagers on momentum as a “tradable factor” or a “thematic basket.”

The fans remain believers. “Any strategy has disappointing periods,” says Antti Ilmanen, global co-head of the portfolio solutions group at AQR Capital Management.

The surge in Moderna and other biotech stocks helped crush the momentum trade. These shares were among the most heavily shorted in recent years, but positive news on a cancer vaccine from Moderna and Merck sent those stocks flying, crushing some quant and other hedge funds. Moderna is up around 150% so far this month.

These traders had an especially rough day on Aug. 19, which Goldman Sachs told its clients was the worst day for “systematic long-short managers” in more than two years. About half of the losses were because of momentum trades, the bank said.

Some traders have begun to short, or bet against, the very stocks that propelled the momentum trade earlier this year. Net short positions in futures tied to the Nasdaq-100 index among speculators recently climbed to some of the highest levels of the past two decades, according to data from the Commodity Futures Trading Commission.

The about-face is a sign of how markets have become more treacherous for investors, even as indexes keep climbing. Part of the issue: the recent meltdown of Situational Awareness, a hedge fund that had piled into some of the most popular momentum shares, including chip stocks. After a period of market tumult, Nvidia shares rocketed almost 9% after its earnings, showing how quickly sentiment can shift.

Some investors say the run-up in share prices driving tech stocks higher reminds them at times of the dot-com frenzy decades ago.

Mike Ogborne, the founder of San Francisco-based Ogborne Capital Management, said he has grown more cautious on technology stocks and is keeping more of his portfolio in cash than he typically does.

And he is nervous about the surge in spending by technology giants and quarterly capital expenditures that keep rising.

“It is a little bit like Cinderella and the clock striking midnight. You don’t know when midnight is going to come around,” Ogborne said. “They don’t send a memo around telling you when the capex cycle is over.”

I Cancelled My Unused Subscriptions. The Money I Saved Paid for a Tesla.

A close look turned up a car’s worth of savings I didn’t know existed

Cutting the cord

I’m still paying for that?

No regrets

Wall Street’s hottest momentum trade has reversed sharply, as former winners tumble and heavily shorted stocks surge.