My portfolio and recent decisions

With the recent large drop in the market and all the really great discussion on the board about it, I felt it could be beneficially to write an update on my portfolio and what I personally have done the last few weeks. I do not claim to be some kind of great stock picker. I have however been investing for two decades and do feel I have something to offer if not just as a person with a different opinion or a different way to go about managing investments different than yourself.

Last update I wrote was on 9/9/18 https://discussion.fool.com/stock-portfolio-september-34002673.a…

The value of my portfolio is down -23% since 9/9/18. Yeap down that much in a month. Am I worried about it, absolutely not. In fact I have been buying stock the last few days with my cash position, which you can see has decreased by -8.6% of my overall portfolio. A few days ago since the value of my stock holdings had declined significantly that cash was over ~15% of my portfolio and now it stands at 2.7%. In fact this is partially why my portfolio is down so much as my purchase from just two days ago are down significantly already.

I have been buying quite a bit of stock on what I view as an opportunity. Now was I too early? Time will tell. However I still have the ability to maximize my wife and myself’s Roth IRA contribution for this year. So if the stock market keeps falling I plan to put money into those accounts, that is I have monies that are on sideline that can be used for additional investment if the opportunity keeps presenting itself. If it continued falling into Jan. 1st I have funds available for 2019 contribution and would take action to fund then as well.


STOCK		%Port 10/11/18		%Port 9/9/18		Change in %

CLNE			0.7				 6.1			-5.4
WIX			12.4				11.7			 0.6
NEWR			  0				 2.2			-2.2
PVTL			  0				 5.0			-5.0
ZS			10.1				11.0			-0.9
SQ			18.4				11.2			 7.2
NTNX			18.2				 8.6			 9.6
TWLO			10.3				 6.2			 4.1
AYX			10.3				13.1			-2.8
MDB			10.1				 7.8			 2.3
APPN			  0				 2.7			-2.7
PSTG			 5.9				 3.0			 2.9
CASH			 2.7				11.3			-8.6
AMRN			 0.9				  0			 0.9   

I will not go into detail on my stocks as most are covered in great detail on this board already. In fact some on this board have a much better understanding of how these companies operate than I do. Many other posters here have influenced my buy and sell decisions based on their insights and analysis. My portfolio and investment style has undergone a more aggressive approach in the last year. I have explained these reasonings in previous post and you can find more detail on that if you are interested in those posts.

I mentioned in last months post that I was trying to get between 6-8 stock holding, more concentrated portfolio than most investors hold or recommend. My thinking is I want my investment money in my best ideas. As you can see I have 8 large holdings and 2 small story stock positions currently. I have been working on transforming my portfolio over the last six months. I am very close to having my portfolio where I want it to be. Below is my current thoughts and decisions that I have made recently.

Largest stock position is SQ. As you can see this is what I said about SQ on my 9/9 post
SQ-It had risen to a percentage where I felt I wanted to reduce my position and take some gains. This is the largest cap stock in my portfolio currently. If you look at my August post you will see SQ was ~15% of my portfolio but I had reduced it by 9/9/18 due to its run up in price/valuation COMPARED TO OTHER STOCKS I OWNED. I capitalized this for a reason. This is a very important distincton that many sometimes do not understand. I feel this is one of the strengths of Saul (he can chime in with agreement or disagreement) in my opinion and one of the things he has help me with; in the sense of being much more quick to sell one stock that maybe riding high while other stocks maybe become beat down for no good reason. I almost wrote that I reduced due to valuation concerns but then I realized that no I reduced due to VALUATION VERSES OTHER STOCK I OWNED. That is I felt I had greater opportunity in another one of my companies versus SQ at that exact moment in time. In the last 3 days I have felt otherwise. I think SQ has been getting beaten down more than it should when compared to my other companies.

To be completely transparent I sold SQ at 87.80 and 88.00 on 8/31/18 and rebought at 83.20, 79, 70.10, 70.01 the last two days. What changed from 8/31/18? Obviously the price went down some, but really it was the relativity to other stocks and the movement created on what I personally think is an over blown news event. Sarah F was a gifted leader of SQ, but truely there is a 50/50 chance that her replacement could be better than she was at her job. Everyone thought when Steve Jobs died AAPL was screwed, turns out they were not. Over the years these types of “news events” have made me a lot of money because I buy into them.

Second largest stock position is NTNX. I have bought heavily on its recent downturn. I think its probably one of the best covered stocks on the board and Bert pretty much endorsed it as highly as any stock he covers. After their quarterly results the stock was getting creamed, again I think this was a buying opportunity and expect that I will be awarded for buying during this distressed time.

Stocks I sold out of PTVL, CLNE, NEWR and APPN. When the quarterly report for PTVL first came out and most on the board sold, I did not. I did not think the results where as bad as many on the board. However after it fell for a few weeks I did sell. Not because I do not like the company, but because I do feel that my investment money is in a better place with NTNX. I used PTVL monies to buy larger % of NTNX after it fell.

I sold down my CLNE position as I felt it was more story stock than functioning company. I do forsee them executing on there plans and me buying back in a much bigger way in the future. However I am going to wait to see improvement in there business first. I used that money to invest in more TWLO.

APPN I started a review, the company is interesting but I just did not think it was going anywhere in the next few years due to what seems to be a lack of sales and marketing of their business. Again I felt there was better places to invest my money (TWLO & ZS). Same can be said for NEWR.

Maybe the most interesting or perplexing move to some would be my decreased position in AYX. I love AYX however I happened to hold it in my childrens educational IRA. If for some reason I have an extremely bad year in my businesses, it is possible that I may need that money for their school tution. In essence that money is an extreme emergency fund and I want to make sure it was in cash. So I sold some AYX. I most likely will increase my position in AYX sometime in future.

I have been looking at PSTG hard in terms of selling. It has not fallen off as hard as many of my other companies. Again relative value against other companies is starting to compel me to think about selling and investing in what I feel are better opportunities. I am seriously considering selling and putting the money into AYX, MDB, ZS and TWLO or possibly AMRN.

AMRN is my newest stock. I recently posted a stock review about it on the board. I still have not found a hole in why it should not be successful. However valuation has greatly exceeded business performance. November will be big as the results of their trial will be released and the stock will go up or down in a big way in my opinion.

47 Likes

Well done.

All the young people here should realize that this little dip is the best thing that could have happened for them, and the bigger the dip the better.

If you’re still adding to your accounts on a regular basis, it’s much better to buy 1,000 shares of XYZ stock over time at an average price of $10 than at $100.

The only people who really get hurt are those that need their funds before prices return to their former highs, or those that are living on their investment income now.

Next year I will be switching from one group to the other as my wife retires and we stop putting funds in our accounts and start living on them instead.

If, of course, there is anything left to live on. :slight_smile:

Yep, all the young investors should be cheering and clapping. At least I haven’t come across anyone crying out in the hall outside the door to Saul’s place. Maybe you guys are smarter than me when I started. A couple of recessions almost made me cry. Then I realized how lucky I was. I hope all you dudes here realize it too.

Dan

6 Likes

I’ll just say that this morning I feel pretty stupid and just leave it at that. :smiley: :smiley: :smiley:

1 Like