Another year in the books, with about 10 min to go.
Combined with 2022, it has been a wasted couple of years.
2023 end-of-month results
Jan -.5
Feb up 2.2
Mar up 3.2
April 3%
May 3%
June -2.5%
July -5%
August -3%
September -3%
October - 2%
Nov -1%
Dec -1%
Blah.
Here is how things have been past several years:
2018 46%
2019 60%
2020 78%
2021 79%
2022 -10%
2023 -1%
This means I remain basically 11% or so off my ATH, which was from Dec 2021 and March 2022 (basically a double top!).
Not bad in context of 6 year stretch.
Not good in context of past 2 years.
I will probably either edit this post or just reply with more thoughts when I get the time, but I can at least initially say that here are my lessons learned:
- Know thyself. I am best at picking entries and selling exits. I got away from that too much.
- Macro as a complement, not as the lead variable. Related to #1, I would see some entry prices hit, since mid-2022, and I didn’t always act on them and/or I would make a buy but would sell too soon out of concern that macro was telling me “a big drop could come at any moment”. So I need to lead with #1 and maybe use a bit of TA and a bit of commonsense in terms of timing or building out a position, but I can’t let macro keep me from going after good entries (unless the stock thesis truly had changed by then).
- Stop listening to other people so much. It is not that I am following what others do…you can tell by my lack of stock purchases that I don’t. Rather, I am getting analysis paralysis a bit from too many macro gurus combined with what I view as contrarian tells from momentum investors that have never met a high valuation in their life. Just gotta be me and do what I think best. Then que sera sera.
Nothing earth-shattering there. But sometimes we make the simple too complicated, whether that is relationships, work, exercise, or stock investing.
I think 2024 gets back to 2017-2019 Dreamer, where I (hopefully) find stocks at good values that I believe have good upside and I ride with them until the thesis either plays out or shows itself to be false. Gotta give these trades time to actually work.
It is not lost on me that an astute reader probably could have made 200% the past couple years on simply following my initial intuitions and entry targets and not quickly selling and cutting bait. Woulda coulda shoulda.
The Positive and Moving Forward:
PTLO - I pointed out that this is a long-term play. Nothing has changed. They have some garbage to work thru due to the PE firm that took them public that created debt, but they are continuing to expand well, more expansion is planned, and I like the CEO and company culture and their products continue to be high-quality (as far as my kids and I can tell).
ESPR - so far this little moonshot doing well. But that is all I am willing to let it be…a moonshot. Hopefully it turns a 1% position into 5%+, but who knows if the future will play out as planned.
Other stocks I like? Lot of Saul stocks are solid, but fairly or richly valued at moment, imo. So I feel the upside is limited in chasing from current levels. Need to do more napkin math and get a fresh set of entry targets, but eventually the market will have a pullback. Just remains to be seen if it is a buyable dip with stocks I like or not. CELH, IOT, TTD, AXON…all good companies with good futures. Stock price is not always the same thing.
The mega tech: NVDA, META, MSFT, AMZN, GOOG…are they really going anywhere? Nope. Is their stock a good buy at current levels? I am not feeling it. Always felt better about betting on a $2b stock to get to $10b than a $1T stock to get to $2T. But that would have been incorrect in 2023. But that doesn’t mean chasing in 2024 makes sense either. Sometimes, you just need to move on.
I believe AI will be commoditized. That doesn’t mean you can’t have current/future stock winners based on AI tailwinds. Just not sure it isn’t going to go the way of the Metaverse pop. What is that hype curve description? Initially up, then questions abound and into the doldrums, then finally emerges with legit usage.
What is the next hype cycle…Quantum computing, biotech/AI, robotics, space (again), metaverse (again)…not sure.
2024 will be volatile, is my not-so-bold prediction. We have a crazy election cycle, and the Fed just raised rates at alarming speed on top of 3+ years of high inflation on top of a covid shutdown the redefined normal life for individuals and businesses and those ramifications are still working themselves out today. Runaway national debt, multiple wars, and huge immigration issues. Time for some new leadership in this country vs retreads, lifetime politicians, and those using the highest office of the land as a reality show spotlight for their own ego-boosting and financial/legal benefits. 300m+ people and this is the best we can come up with? Sheesh.
Sometimes you need to hit the bottom before you can start climbing your way back up consistently and persistently.
There was a lot for me to personally like in 2023, and also a lot I am happy to move on from. Not too different from most years, in that regard, I guess.
Happy New Year to all,
Dreamer