Just a little catch up!

A little catch up!

  1. My portfolio was up 15.1% last week.
  2. It is up 45.0% from it’s low of June 16.

This is why I don’t try to time the market. Do you remember back in mid-June when all those trolls showed up telling us that SaaS stocks were finished and would drop another 50% and I was exhausted and frustrated by having to delete a half dozen posts, to sometimes a dozen, posts a day? It was an unpleasant and scary time

  1. How did my stocks do from their lows to Friday’s close? Here they are (as of Aug 6) in order of results.

**NET, from $38.96 to $74.24,     up      90.6%  !!!**
**MDB, from $213.4 to $356.8	up      67.2%  !!**
**BILL, from $89.9 to $142.5 	up      58.5%  !!**
**SNOW from $110.3 to $165.53	up      50.1%  !!**
**CRWD, from $130.0 to $191.2	up      47.1%  !** 
**MNDY, from $87.05 to $127.83	up      46.8%  !**
**S, from $18.64 to $26.36	up      41.4%**
**DDOG, from $81.1 to $113.3	up      39.7%**

This is why I don’t go into cash. Did I imagine that in seven weeks this was going to happen? No way. If I was in cash, would I have gotten back in at the bottom? (no way). Or would I have worried that it wasn’t the right time yet, and then suddenly the prices would have been up too much and I’d be afraid to get back in.

  1. Cloudflare went from fourth place to first place in my portfolio on Friday, rising 27% in a day and 47.6% in a week. It’s now up almost 91% from its low in this contraction.

Did I know that this was going to happen? Not a chance! Just a week or two ago people were telling us how overpriced it was.

  1. Datadog, everyone’s favorite, has risen the absolute least from its low, as you see above.

That’s why I’ve quit taking those 30% positions in my favorite companies. It’s never worked for me. My position in Datadog has varied in the past few months from about 17.5% to 19.5%. It’s now 17.4%.

Best, and I hope that this was helpful.

Saul

183 Likes

Just for curiosity I used that table and calculated how much on average the eight companies in my portfolio were up from their recent lows. It was 55.2%.
Saul

25 Likes

Saul
I have to ask this. Let’s say we are both alive the next time we have a scenario where the market is at an all time high, deep into a bull market, a decade of a friendly Fed, hyper growth at stretched to say the least valuations, and the Fed reporting that they are going to fight inflation by hiking interest rates. All that was going on in November, and weeks later the Fed announcing their plan to pull away the punch bowl, after years of being incredibly dovish. If this scenario occurs again, which at some point it will, maybe 10 to 20 years from now, who knows, would you still stay 100% invested? Better yet, since we might not be here for the next occurrence, if you had it to do over again, these last 8 months, would you choose to stay fully invested in hyper growth?

History has shown that when the Fed turns hawkish, when it’s time to ratchet up interest rates, the market always takes a hit. That the market, especially tech, finds a bottom sometime around the second rate hike. Then tech leads from there out of this hole, which it seems to be doing now.

I WENT 36% cash in November, but not completely convinced, I didn’t fully wait until the rate hikes started, I edged in along the way. Still edging in now, it almost completely there now. Wish I had completely waited.

My point, for me anyway, don’t fight the Fed is real. Next time anyway.

TMB

30 Likes

TMB,

You’ve been very public about having made multiple 7 figures because you held and never sold out of Apple, Amazon, Netflix (the latter till recently), for 20+ years? I’m assuming that means you held your shares through all of the downturns, including epic 2008, right?

If that’s correct, doesn’t that answer the question you’re testing Saul to answer?

Best,

Brian

40 Likes

Last FED was hiking the rate from 2016 to 2019
But only once S&P 500 fall by 20% from Sep to Dec 2018
From here we can understand that we will not know the market what will do and for how long and not like this time.
I agree Saul said, “then suddenly the prices would have been up too much and I’d be afraid to get back in”.

8 Likes

“You’ve been very public about having made multiple 7 figures because you held and never sold out of Apple, Amazon, Netflix (the latter till recently), for 20+ years? I’m assuming that means you held your shares through all of the downturns, including epic 2008, right? “

I did hold those companies, you are correct. Most likely could have done better if I had sold them down in 2008/9 timeframe. I don’t believe though that you can compare any of the cloud names to an AAPL, or an AMZN. I believe then that I owned 800lb gorillas that had the opportunity to become 8000lb gorillas. DDOG I don’t believe is the next trillion dollar company, most here would be long gone before it became a 200 billion dollar company.

I’m not talking about timing the market. I’m talking about the rare event when a bull market is long in the tooth, stocks are selling at very high multiples, and the Fed tells us that they are about to aggressively raise interest rates. Again past history shows this is a time to pull back and wait. Maybe not your entire portfolio, but certainly have some cash on hand to take opportunities that will come.

It’s a once every decade or more event, and for me at least the lesson learned is “don’t fight the Fed”. Did it work for me this time? As I said above, it could have been better, but as of Friday my entire portfolio is down 14% YTD. So it certainly helped.

This is getting into portfolio management, not where I want it to go. I asked a simple question. What lesson of any was learned from this last 8 months? That’s for the individual to decide. I think it’s never too late to learn, at least I try to keep learning.

TMB

37 Likes

1. My portfolio was up 15.1% last week.
2. It is up 45.0% from it’s low of June 16.

This is why I don’t try to time the market.

And I should make clear that I don’t know what my portfolio will do next week either, or next month, or the next six months, however after a 15% rise last week, I wouldn’t be surprised if it takes a substantial breather next week, but look, I wouldn’t be surprised if it keeps going for a bit either. I’m not investing in stock prices, I’m investing in extraordinary companies.

There is still a war going on in Europe (the first major war in almost 80 years), and it’s caused dislocations in oil, natural gas, food, etc, and there are still the results of the Covid epidemic with container ship delays, etc, and China closing down its cities one after another, and let’s not forget threatening Taiwan (and the US, as well), and there’s the inflation that those shortages helped cause, and rising interest rates, etc. The world isn’t in a rosy place (although our own economy seems to keep on booming to spite the Fed, with record job adds and record low unemployment). I don’t have a clue what the market will do but I’m sticking with my companies. But that’s just me, and you have to decide what makes sense for you, and make your own decisions.

Best,

Saul

82 Likes

This is why I don’t go into cash. Did I imagine that in seven weeks this was going to happen? No way. If I was in cash, would I have gotten back in at the bottom? (no way). Or would I have worried that it wasn’t the right time yet, and then suddenly the prices would have been up too much and I’d be afraid to get back in.

I have a bunch of friends who sold all their Monday and felt that they’d wait until after earnings this morning, to see if Monday passed all their criteria. Well a minute ago when I looked, Monday was at $155, up 21% today from $128.30 last Friday, and up 51% from the $102.70 they closed at one Friday ago, five and a half trading days ago . Granted, I only have a 4.7% position, but I’m glad I have it, because it would be daunting to enter after a 51% rise.

Best,

Saul

54 Likes

“I have a bunch of friends who sold all their Monday and felt that they’d wait until after earnings this morning, to see if Monday passed all their criteria. Well a minute ago when I looked, Monday was at $155, up 21% today from $128.30 last Friday, and up 51% from the $102.70 they closed at one Friday ago, five and a half trading days ago . Granted, I only have a 4.7% position, but I’m glad I have it, because it would be daunting to enter after a 51% rise.”

Saul,
Looking at shorter times frames, doesn’t it become a game of confirmation bias? I know people that bought MNDY last November around 400, and added beginning of this year at around 300. I also know people that sold it early this year around 200 or above. MNDY is still down over 52% YTD, and I don’t have a calculator on me, but from its all time high in Nov 2021, it has to be down still like 70%?

So yes, anyone that bought at the bottom last month has done great, but anyone that bought between its IPO and around mid May of this year is still technically underwater.

We can look at thousands of stocks that have bounced. I have been trading REAL for the past few months. Last week it was around 2.16, today it’s above 3.60. Spectacular move, but it’s one of hundreds of stocks that have had spectacular bounces. Yet it’s still down a whopping 69%YTD.

TMB

38 Likes

I have been following “Saul” for over 5 years now. I have NEVER posted, not even once. But I have to say something here: You have just proved exactly why Saul has explained why HE does not go to cash. Some have bought right, and some have bought at wrong times with Monday and many other stocks. BUT, very very few have bought and sold Monday in a profitable manner, of that I am confident.

I’ll admit that I went to a fair bit of cash because that was what made ME sleep at night. I’ll bet that when it is all said and done, I would have done better if I just went into hibernation.

Not much of a post, but sometimes you just have to open your mouth and see what comes out.

72 Likes

When I started this thread over the weekend, just three trading days ago, I was thinking this is why I don’t go into cash.

My portfolio low had been on June 16 at just 33.1% of where I had started the year. Did I imagine that in seven weeks there would have been a rise like this? No way! If I had been in cash, would I have gotten back in at the bottom? No way! It felt terrible and all that people were talking about was how much further it would inevitably sink.

I have worried that it wasn’t the right time yet, and that I was catching a falling knife. And if I had stayed out, as I probably would have, then suddenly the stock prices would have been up too much and I’d be afraid to get back in. I would have waited for a pullback to buy in, but our stocks have just kept going up since.

If you were in cash waiting for a pullback, would you have the courage to get back in now???

My portfolio was up another 7.5% yesterday. It’s now at 51.5% of where I started the year. That’s up 56% from my bottom. [51.5 divided by 33.1 equals 1.56]

How about the individual stocks? Here’s how much each of them is up from its low of this pullback, as of yesterday’s close, (Weds, Aug 10):

Here they are (as of Aug 6) in order of results.


**NET, from $38.96 to $78.61,     up     101.8%  !!!**
**BILL, from $89.9 to $162.5 	up      80.8%  !!!**
**MDB, from $213.4 to $380.3	up      78.2%  !!!**
**MNDY, from $87.05 to $141.22	up      62.2%  !!**
**SNOW, from $110.3 to $174.4	up      58.1%  !!**
**CRWD, from $130.0 to $200.8	up      56.0%  !!** 
**S, from $18.64 to $28.11	up      50.8%**
**DDOG, from $81.1 to $117.8	up      45.3%**

As usual, Datadog was up the least, which has held my portfolio back, but they are all up over 45%, seven of eight are up over 50%, three are up over 75%, and one is up over 100%. The eight of them average up 66.6%.

[My portfolio was also held back by a small foray into UPST seven or eight weeks ago.]

Again, this is why I don’t go into cash. If you think you can time just the right place to get out, and then just the right place to get back in, go for it! I know that I can’t.

Best,

Saul

93 Likes

What falls the most does tend to rise the most, if the fundamentals are sound!

These are all the stocks mentioned and held by Saul and others from November 1st 2021 to present sorted by the month to date (MTD) return. Note the return of Cloudfare - an amazing 58.46% in just a few market days.

The Year-to-Date (YTD %) and One-Year (YEAR %) returns still look pretty horrific.

**Based on: 8/10/2022              MTD %   QTD %   YTD %    YEAR %   Symbol**
**Cloudflare Inc Cl A** 58.46%  76.02%  -40.02%  -37.35%  **NET**
**Monday Com Ltd** 40.49%  36.68%  -55.00%  -38.55%  **MNDY**
**Upstart Holdings Inc** 39.41%  4.49%   -78.19%  -75.31%  **UPST**
**Zoominfo Technologies Inc Cl A** 33.46%  50.12%  -22.83%  -16.19%  **ZI**
**Amplitude Inc Cl A** 28.45%  29.43%  -64.74%  -65.89%  **AMPL**
**Mongodb Inc Cl A** 23.47%  44.21%  -26.15%  4.35%    **MDB**
**Bill Com Holdings Inc** 20.59%  45.49%  -35.04%  -18.64%  **BILL**
**Snowflake Inc Cl A** 18.92%  24.50%  -48.86%  -36.46%  **SNOW**
**Zscaler Inc** 18.69%  20.55%  -44.08%  -24.99%  **ZS**
**Datadog Inc Cl A** 18.00%  23.63%  -34.12%  -6.02%   **DDOG**
**Sentinelone Inc Cl A** 15.35%  19.62%  -45.94%  -42.99%  **S**
**Lightspeed Commerce Inc Sub Vot** 13.65%  7.00%   -40.79%  -74.10%  **LSPD**
**Crowdstrike Holdings Inc Cl A** 11.07%  19.35%  -2.05%   -20.53%  **CRWD**

The rise from the lows mostly set in mid-May or mid-June are impressive!

**Based on: 8/10/2022              52 High  Date        % Dif    52 Low   Date       % Dif    Symbol**
**Cloudflare Inc Cl A** $221.64  11/18/2021  -64.53%  $38.96   6/16/2022  101.77%  **NET**
**Bill Com Holdings Inc** $348.50  11/8/2021   -53.37%  $89.87   5/12/2022  80.83%   **BILL**
**Mongodb Inc Cl A** $590.00  11/17/2021  -35.54%  $213.39  5/26/2022  78.22%   **MDB**
**Monday Com Ltd** $450.00  11/9/2021   -68.62%  $85.75   7/19/2022  64.69%   **MNDY**
**Zoominfo Technologies Inc Cl A** $79.17   11/19/2021  -36.97%  $30.31   6/14/2022  64.63%   **ZI**
**Lightspeed Commerce Inc Sub Vot** $130.02  9/22/2021   -81.43%  $15.03   5/12/2022  60.61%   **LSPD**
**Snowflake Inc Cl A** $405.00  11/17/2021  -56.94%  $110.27  6/14/2022  58.16%   **SNOW**
**Crowdstrike Holdings Inc Cl A** $298.48  11/10/2021  -32.73%  $130.00  5/12/2022  54.46%   **CRWD**
**Sentinelone Inc Cl A** $78.53   11/12/2021  -64.20%  $18.64   5/12/2022  50.80%   **S**
**Upstart Holdings Inc** $401.49  10/15/2021  -91.66%  $22.42   7/26/2022  49.45%   **UPST**
**Datadog Inc Cl A** $199.68  11/17/2021  -41.02%  $81.12   6/16/2022  45.17%   **DDOG**
**Zscaler Inc** $376.11  11/19/2021  -52.03%  $125.12  5/18/2022  44.19%   **ZS**
**Amplitude Inc Cl A** $87.98   11/4/2021   -78.76%  $13.42   6/30/2022  39.27%   **AMPL**

The average pop from the lows is 60.94%, while the average drop from the highs last November is -58.29%.

40 Likes

When I started this thread over the weekend, just three trading days ago, I was thinking this is why I don’t go into cash.

My portfolio low had been on June 16 at just 33.1% of where I had started the year. Did I imagine that in seven weeks there would have been a rise like this? No way! If I had been in cash, would I have gotten back in at the bottom? No way! It felt terrible and all that people were talking about was how much further it would inevitably sink.

I have worried that it wasn’t the right time yet, and that I was catching a falling knife. And if I had stayed out, as I probably would have, then suddenly the stock prices would have been up too much and I’d be afraid to get back in. I would have waited for a pullback to buy in, but our stocks have just kept going up since.

If you were in cash waiting for a pullback, would you have the courage to get back in now???

My portfolio was up another 7.5% yesterday. It’s now at 51.5% of where I started the year. That’s up 56% from my bottom. [51.5 divided by 33.1 equals 1.56]<<<

This. Timing the market successfully means knowing when to get out, but more importanly, when to get back in. Also, research says missing the big turnaround days will reduce S&P returns by 50%. Imagine that it would be more for the high Beta stocks.
Vince

3 Likes

Timing the market successfully means knowing when to get out, but more importanly, when to get back in.

Right, but does anyone really know this? Isn’t it a best guess that turns our right this time, wrong other times?

3 Likes

The biggest question, of course, is what will it take for these same stocks to get back to their high in November of 2021. This is what I show in the far right column. So it will require an average gain of 237% to return to the previous high. From the low it would have taken 430% to get back to the high. As you can clearly see, it has already made significant progress on the journey! A drop from needing a 430% average gain to just 237% now.

What is most interesting is that the average drop from the highs in November is -58.69%, while the average rise from the lowest lows is 59.48% already.

The stocks that are closest to their previous highs are CRWD, DDOG, ZI and MDB. The worst are those that most have probably exited long ago - AMPL, LSPD and UPST.

**Based on: 8/12/2022              52 High  Date        % Dif    52 Low  Date       % Dif   Symbol  % Low to High  % Now to High**
**Crowdstrike Holdings Inc Cl A** 298.48   11/10/2021  -32.70%  130     5/12/2022  54.52%  **CRWD** 129.60%        48.59%
**Datadog Inc Cl A** 199.68   11/17/2021  -42.05%  81.12   6/16/2022  42.65%  **DDOG** 146.15%        72.55%
**Zoominfo Technologies Inc Cl A** 79.17    11/19/2021  -36.95%  30.31   6/14/2022  64.70%  **ZI** 161.20%        58.59%
**Mongodb Inc Cl A** 590      11/17/2021  -35.75%  213.39  5/26/2022  77.66%  **MDB** 176.49%        55.63%
**Zscaler Inc** 376.11   11/19/2021  -51.44%  125.12  5/18/2022  45.97%  **ZS** 200.60%        105.93%
**Snowflake Inc Cl A** 405      11/17/2021  -58.35%  110.27  6/14/2022  52.98%  **SNOW** 267.28%        140.10%
**Bill Com Holdings Inc** 348.5    11/8/2021   -54.77%  89.87   5/12/2022  75.41%  **BILL** 287.78%        121.07%
**Sentinelone Inc Cl A** 78.53    11/12/2021  -64.29%  18.64   5/12/2022  50.43%  **S** 321.30%        180.06%
**Monday Com Ltd** 450      11/9/2021   -69.53%  85.75   7/19/2022  59.88%  **MNDY** 424.78%        228.23%
**Cloudflare Inc Cl A** 221.64   11/18/2021  -64.97%  38.96   6/16/2022  99.26%  **NET** 468.89%        185.51%
**Amplitude Inc Cl A** 87.98    11/4/2021   -78.90%  13.42   6/30/2022  38.30%  **AMPL** 555.59%        374.03%
**Lightspeed Commerce Inc Sub Vot** 130.02   9/22/2021   -81.93%  15.03   5/12/2022  56.35%  **LSPD** 765.07%        453.28%
**Upstart Holdings Inc** 401.49   10/15/2021  -91.34%  22.42   7/26/2022  55.07%  **UPST** 1690.77%       1055.03%
**Average of All                                        -58.69%                     59.48%          430.42%        236.82%**
29 Likes

Zee

That 237% number you present sounds very daunting. It’s a headline grabber for certain. Take away the bottom three though, the three that no longer belong on this board, how much does that lessen that very eye popping number?

I’m guessing it cuts it in half, which is a lot less daunting a number.

TMB

4 Likes

Right, but does anyone really know this?<<<

MJ,
That was my point, not communicated very well. It’s very hard or even impossible to be able to consistently know the tops, bottoms and when the switches flip. So I am agreeing with Saul that staying the course was his best option.

Fool On!
Vince

2 Likes

I have to ask this. Let’s say we are both alive the next time we have a scenario where the market is at an all time high, deep into a bull market, a decade of a friendly Fed, hyper growth at stretched to say the least valuations, and the Fed reporting that they are going to fight inflation by hiking interest rates. All that was going on in November, and weeks later the Fed announcing their plan to pull away the punch bowl, after years of being incredibly dovish. If this scenario occurs again, which at some point it will, maybe 10 to 20 years from now, who knows, would you still stay 100% invested? Better yet, since we might not be here for the next occurrence, if you had it to do over again, these last 8 months, would you choose to stay fully invested in hyper growth?

TMB,

Can something be learned or does thinking like this fill one with regret over what happened during the past nine months? Personally, I’ve thought about this over the past months. We should remember that the Fed threatened to take away the punch bowl in late 2018, but then the FOMC changed its mind. Stocks rallied in 2019 and 2020. Then in there was talk of inflation in 2021 and there were fears that the policy of loose money was bound to end. Growth stocks sold off from Feb to May 2021 only to rally hard from May to October. Standing here today, that May-Oct/Nov rally was likely the last hurrah in this bull market cycle. Finally, most who managed to sell some near the last peak where back in by the end of 2021 (or by the end of January 2022); these people were still down close to 50% just in 2022.

All this thinking has led me to think more about what it means to be down a lot. For me personally, the loss in dollars was enormous. That loss was only possible because of the outstanding returns that I had racked up for the five years prior. So, the question became for me: when one has made obscene amounts of money then doesn’t it become increasingly important to preserve that money rather than continue to try to maximize CAGR. The point here is that not everyone is in the same position in age, life, financial obligations. Some people who are just starting out and have little don’t really have a choice to sit out of one of the best money making machines in existence. But those who have become more than wealthy, it can may to remember this phrase: you only need to get rich once.

GR

95 Likes

The reason I did not previously post is that this gets us into port management and everybody’s context, which is off topic. But since the thread is still standing, I will add my 2c because both sides are right here, depending on one’s individual circumstances.

Gaucho Riko, yours is a great post. I can assure you that TMB has no regrets. He has done very well since Nov 2021 compared to those of us who remained fully invested and exclusively in SaaS. The point TMB is making is exactly the same as the main point of your second paragraph.

At the same time, Saul is certainly right when it comes to a replicable system because such a system must be based on empirical data and be broadly applicable. TMB and you are right when it comes to individual contexts: for some people at some point, risk management probably becomes more important than growing the cake.

I am 47. I have to grow the pie. I have remained fully invested. Consistent market timing is impossible even if everyone can get lucky at times–and you only need to get lucky once :slight_smile: I only care where I am in 2035 and beyond. My software-only 401k aside, I am now -30% off my cost basis in my taxable account after the big rally. Shrug. But if I were 67, I would have had a more diversified approach.

I had a discussion with Stock Novice on Mongoose a year ago. I argued the primacy of the monetary backdrop. Did I see the speed and extent of the drop? No. Did I sell? No. But realizing how important the rules of the game are helped me remain calm. Not happy, but calm. Added what I could in May, just in time for the last big drop :slight_smile:

In sum, port management is off topic here but is very important and everyone needs to think about that before investing 100% in any given approach.

I am sure there are others like me who joined TMF and Saul’s approach just in time to go negative on cost basis. It is part of life in the financial markets. Must stay calm and keep the eyes on the horizon.

27 Likes

(Ups, missing formatting and therefore hard to read at first. May the managers be so kind and delete the first of these double posts? Sorry and Thank you.)

TMB wrote:
Zee, That 237% number you present sounds very daunting… Take away the bottom three though, the three that no longer belong on this board, how much does that lessen that very eye popping number? I’m guessing it cuts it in half, which is a lot less daunting a number.

Apart from a few % AMPL and LSPD were at their lows already in Feb (and UPST already cut in 1/4) — at a time when if I am not mistaken they still were “rightly” part of what Zee assembled here, kind of “a Saul’s port”. Removing them now from the port and looking how much each remaining single stock has to gain to be where it was at it’s high mathematically is VERY different from how much the port has to gain has to gain for that.

To make that a bit clearer (the following numbers actually are quite representative to what happened when to which parts of Saul stocks):

  • To simplify let’s say there are only two port components, stock A and stock B
  • A represents the still “good ones” (DDOG,NET,CRWD…), B the now “dark side” (AMPL,LSPD,UPST)
  • Port High is in Nov’21, with A worth $500 and B worth $500. You then buy 1 share each, so the port value is $1000
  • In Feb’22 B’s thesis does not not convince you anymore. You sell for it’s then $50 price and invest the proceeds in A which then is at $250, so that you now have 1.2 A’s
  • From Feb until now A sinks a little further, to $200, so your 1.2 A’s are worth $240.

Blindfolding yourself now for the loss of having bought B for $500 and sold for $50 only you conclude: “1 share of A is worth $200 currently. A bit more than 100% gain and it’s at $500 again.” Correct! Stock A then is back to it’s high from Nov — but your port is not, as 1.2 x $500 still is a far cry from the $1000 you then invested!

I just found for what I thought is called" cheating oneself" in an German-English dictionary the much more beautiful word “whitewashing” :wink:

1 Like