Bear's Portfolio through 08/2022

PaulWBryant · August 31, 2022, 7:34pm

WARNING: I was down roughly 54% YTD at one point this year. That means I only had about 46% remaining of what I started the year with! No one can prepare you for what it feels like losing more than half your net worth, even “on paper”…it’s not easy for most of us to tolerate. Don’t copy me or Saul or anyone – figure out what works for you.

Please don’t email me portfolio management questions. I have absolutely no idea what you should do, because only you can know how best to run your portfolio – and if you’re like I was when I was first running a concentrated portfolio, it will take months of rapt learning (including following along on this board) – and plenty of trial and error – to figure out what works for you. Here are a few answers to some questions I get frequently:

Q: Does your return percentage include the cash you hold?
A: YES, the 0% return from cash held is included in the overall return and obviously drags it down when the portfolio is up, but also drags return up when the portfolio is down. I’m constantly adding to and trimming positions, so my cash level fluctuates all the time – and I won’t be able to share my real time moves, just the monthly snapshot.

Q: Are stocks overvalued? Is that why you hold so much cash?
A: I never know when anything is overvalued. I just do what works for me.

Q: Should I hold cash to be able to buy on pullbacks?
A: Probably not if you have new money coming into your portfolio regularly (like from a paycheck), right? But when you’re retired you just have to figure out what works for you. The closest thing to advice I’ll say is this: You will never time it perfectly anyway, so just use your judgment and do what helps you sleep at night.


**Port Return**
Jan -21.2% YTD
Feb -23.8% YTD
Mar -26.0% YTD
Apr -35.5% YTD
May -49.0% YTD
Jun -47.7% YTD
Jul -41.3% YTD
Aug -36.1% YTD

**Here’s the portfolio:**
Ticker	Curr%	Jul	Mo Ch	YTD Ch
DDOG	17.2%	27.3%	2.9%	-41.1%
BILL	11.4%	10.0%	19.8%	-35.0%
CRWD	8.0%	3.6%	-0.5%	-10.8%
MDB	5.9%	12.4%	3.3%	-39.0%
SNOW	5.8%	9.7%	20.7%	-46.6%
NET	5.1%	7.7%	24.3%	-52.4%
TTD	4.8%	0.0%	39.3%	-31.6%
PTON	2.1%	0.0%	7.4%	-71.5%
TWLO	1.3%	0.0%	-17.9%	-73.6%
cash	38.4%	27.7%		

**Sold in 2022**
ZS	0.0%	1.5%	2.7%	-50.4%
S	0.0%	0.0%	9.9%	-45.9%
AMPL	0.0%	0.0%	2.5%	-71.4%
MNDY	0.0%	0.0%	10.7%	-69.4%
UPST	0.0%	0.0%	6.5%	-82.9%

Here’s what I did in August:
August ended up being a good month, but it doesn’t feel that way, as we’ve ended with several down days. It’s also been a busy month, as every company in my portfolio reported earnings. Some did well, but the big winners (Cloudflare, Bill.com, Snowflake, and The Trade Desk) have all fallen significantly since they soared after earnings. Still, those 4 are higher now than they were at the beginning of the month. Datadog and Crowdstrike were basically flat, which makes sense because their earnings were just ok, and we always expect exceptional. Mongo reported today, and their earnings were the worst of the bunch. I slashed my position as you see above.

I reduced Datadog but only because it was too big. I’ve added some back. I discussed this here: https://discussion.fool.com/using-rpo-it-is-clear-that-future-gr…

I added to Crowdstrike a bunch this month. Now I’m just feeling ok about it, as their report wasn’t exceptional and fantastic like we always want. But it seems very solid so I doubt I’ll trim much unless it goes up – and who knows, I might even add opportunistically.

I trimmed Snowflake and Cloudflare despite great reports because their prices spiked too high in my opinion. As they’ve come back down, I’ve been adding back.

Other than Crowdstrike, Bill.com is the only position I’ve added to this month. I initially trimmed thinking that like Snowflake and Cloudflare, Bill had run too high after earnings. Then I realized this is still a sub-$20b company, and it might very well have another double in it over the next couple years, so I bought back all I had trimmed and a little more.

I sold the last of my Zscaler. I’m fairly concerned they’re losing to competition.

I bought a position in The Trade Desk. They have really become as much of a juggernaut as Snowflake or Crowdstrike or Datadog. The only reason I’ve been out is that they’re a lot less predictable because the advertising environment can toss them about. Still, I see them as a proven, long term winner. A 5% position seems like a good start.

Lastly, I also bought tiny positions in Peloton and Twilio. These are mostly companies I want to watch. They’ve been beaten down mercilessly, and though I don’t think they are as sturdy as our typical growth stock, I don’t think they’re dead. These will remain VERY small positions.

So that’s 7 real positions, or 9 total if you count the two tiny ones.

I’ll keep this short because I’m a bit tired from the slew of earnings, and from this market which is again being hard to please. I guess I’m hard to please too, as our companies aren’t wowwing me the way I had gotten used to. Therefore I’m ok with medium sized positions in most everything. I’m content to keep a large portion of the portfolio in cash, as I can sit back and relax and wait for opportunities. If the market again decides our companies are worth a lot more than their current valuations, I’ll still benefit, just less-so than if I were 100% invested. I’m ok with that.

Good luck in September.

Bear

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Bear's Portfolio through 08/2022

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