Stock Portfolio update 9/14/18

Lots of people on Instagram ask what I am invested in or what others are invested in. Today we’ll go over all my positions and what I’m looking into in the future.

I currently have $9,750 funded in my Robinhood portfolio, however with dividends and profits I have made $670.92 throughout my time investing. I began investing with Robinhood in December of 2016 and have been growing my account ever since. My final funding round will be to round out my account to $10,000 by the end of September and I will not be putting any more money into the account for quite awhile after that. The screenshot below was taken a few days ago showing my account balance, you may notice that it is down a little bit from the $9,750 + $670 profit, but that’s alright I’ve dealt with both highs and lows of my portfolio balance.

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We’ll deep dive into some of my larger positions, first Chesapeake Energy (CHK) this was one of my first investments when I started investing and I have added and cost average the position down quite a bit over time. As you can see here we are down a little bit but nothing to worry about. I plan to continue to cost average a bit and try to sell some of my position when we reach around 20% profit or so.

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Another large position I own is Ulta Beauty (ULTA) this one has been a wild ride for sure. I owned it when it hit its all time high of ~$312 ish and I have also held it through its lowest point in some time dipping below $200. The market finally came back around to the beauty retailer and it is currently a decent little profit as you look at the cost average and return rate below. They have significant raised 12-18-month price targets of this stock and I plan to exit around $335 which would net a 30% profit or thereabouts.

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Another large position I own is Realty Income (O) I have owned this stock for a considerable time as well and it is a key player in my dividend income. In case you are unfamiliar with this stock, it is a monthly dividend paying REIT stock. It yields about 4.75% at my current cost average and has been a key factor and the liquidity of my portfolio when I don’t have funds coming into the account. I plan to hold this position for the foreseeable future and anytime it does dip down I plan to cost average down and buy more. A great example of this is when the 10-year bond was over 3% and many dividend stocks including O took a big hit as investors flocked to the high bond yield and security they provide.

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The above three positions are the largest in my portfolio, I would like to also include a few key stars to my portfolio below.

My apple position below is probably one of my best-timed trades. It was after the little correction in February and I picked up the cheapest Apple stock since October 2017, only issue… I couldn’t buy more, I was out of funds and couldn’t justify selling any portions of my other positions. As you can see I think going heavy into Apple at that time would have been the move to make but why cry over spilt milk.

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I also dabble in options trading, I’m not the greatest at it and I’ve lost a little bit of money and made a little bit as well. Below you can see my current options spread, I sold some of the SNAP puts for 40-115% profit today however the puts were very inexpensive, so I only really made like $10 off them.

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Ford (F) is another one of my large positions, currently at 100 shares with a cost average of $10.74 the blue oval isn’t doing too well for me. (-12%) I have been holding and growing my ford position for awhile now and I enjoy the nice dividends, (currently yields 5.6% based on cost average) again this is a huge part of my liquidity and fluidity of my portfolio in the coming months.

Proctor and Gamble is another proud pick up by yours truly. At a cost average of $74.40 we are up around 11% + a solid 3.8% yielding dividend. I picked this up in May 2018 at its lowest price it had in 2 years, another play with great timing, unfortunately I only purchased 2 shares and just like my Apple position I wish I bought more.

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Here are my recent deposits and dividends, I put $1,750 into my robinhood portfolio this summer and have collected lots of dividends as well. I am continuing to increase my forward dividend and hoping to reach $1,000 in passive income received for 2018. I am looking into further expanding my positions in Chinese stocks (JD, BABA) as well as Facebook (FB)

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stock portAs always let me know what you think and what positions you currently have!

 

Modern Long Term Stock Market Investing Secrets-summary and review

I’ve been watching the Financial Education YouTube channel for a while now and I really like the content and the enthusiasm Jeremy brings to his audience. Those who pursue success and greatness can relate to him well. He is a very successful investor and admits his mistakes and his errors when they come up proving his honesty to his viewers.

Now onto the book, Modern Long Term Stock Market Investing Secrets!, Jeremy reveals how he went from $0 to $200,000 by age 25 using this stock market investing method. He first goes into how he started considering the stock market. Looking at CD’s, savings accounts, bonds etc. yielded very low returns and real estate investing was out of the question for him at 19 years old making $7.50 an hour at his job. This led him to the stock market and he started reading and learning about Warren Buffett. Jeremy credits most of his success in stock market investing to Warren Buffett and an accounting teacher he had in his schooling.

He then goes into how to buy a stock through a brokerage, and then thinking of the underlying company you are buying rather than the stock ticker. This is right out of Warren Buffett’s playbook by looking at the company fundamentals and longevity rather than the short-term outlook. However, as Jeremy further goes into his method we see the key difference between his method and the buy and hold method Mr. Buffett uses. That is the time frame, in modern long term investing Jeremy works within a 1-5 year span. This is due to the rapid change in technology and growth that we experience nowadays. With the evolution of technology at such a rapid pace, business fundamentals, and company outlooks can change just as fast.

Jeremy then goes into what he looks at to determine if the company fits his investment criteria. The first would be looking at the management team and he uses the hockey reference, a management team that skates to where the puck will be rather than skating where the puck is. This ensures that the company will be making sound decisions years down the line. The next criteria is the balance sheet. He primarily looks at financial security or the ability for the company to make it through a tough time and the company’s ability to grow or acquire other businesses. This involves looking at the debt and on hand cash a company has. Jeremy typically looks at companies with very low debt, lots of cash on hand, and a strong brand name in its industry. The balance sheet is one of the most critical portions to his method and he references that in the end of the balance sheet chapter (chapter 6).

The income statement is the next metric he looks at. Jeremy looks at net income and revenue growth primarily and likes to see them grow by at least 10% a year, and prefers net income to outgrow revenue showing increasing profitability. Along the same lines, Jeremy loves “to look at companies that have an expanding gross margin and a high profit business model!” Obviously making profits reflects in the net income line and high margins allows a company to cut them in tough times without a large effect. Both are key aspects in his modern long-term investing method.

Next item on the agenda is PE ratios, EPS, and quarterly results. Now in the grand scheme of things when investing between 1-5 years a bad quarter is a drop in the bucket when you’re talking about an investment expecting to make it through 10+ quarters. He goes in depth as to what range of PE ratios he looks at and pending those numbers what he looks at in his other criteria. He recognizes that constant struggle between growth and value which is shown in the PE ratio. Warren Buffett is primarily a value investor which is where Jeremy has gained most of his investment background. However, the days of buying and holding are over and greater gains can be achieved for the most part by growth companies over the short term. Growth companies are rarely undervalued though, leading to a challenging terrain of finding a growth company for an excellent value.

He goes into dividends, share buyback, acquisitions and mergers next. He notes the usefulness of dividends however he thinks they are the biggest waste of money since cash is coming out with no return on investment. Jeremy ranks the following from best to worse use of capital: Expanding the business, share buyback, dividends, and acquisitions/mergers being the worse use of capital. He wraps up the book with a chapter talking about thinking outside the box and acquiring all information on a business is critical and could lead to good insight. Followed by a recap chapter, then a FAQ chapter, and finally a definitions chapter.

This article was a brief summary of the book. The information in this book in addition to the Financial Education channel has helped my investments and personal finance immensely. I would recommend this book to any beginning/novice investor as it has lots of fundamental value to add to your personal investing. Below is a link to the book on amazon.

http://amzn.to/2E2fgor

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