December 31, 2022 marked exactly two years for me managing more than one company in a portfolio.
Although I have posted about individual holdings and laid out the other companies I have held from time to time, this will be my first attempt at actually doing a fuller update. Because I am new to investing, and because I imagine many reading this are also relatively new, maybe my journey will help some.
Scroll to the bottom if you just want to see my current holdings.
WHERE I BEGAN
By profession, I am clergy and an author of eight books (nine if you count this post!). I have a pension fund and an annuity that are managed by others, but had never dreamed of owning and managing stock on my own. I am math phobic, so I thought I couldn’t possibly do this. So I left it to others.
In March of 2020, however, when I saw churches dealing with the unprecedented disruption of Covid by holding services on Zoom, I turned to a friend and said, “Someone smart should be buying stock in Zoom.” Most churches are not exactly forward-looking. If they were using it, and they were, it was going to take off. Then I thought, “Why shouldn’t that smart someone be me?”
So I figured out how to open a brokerage account, scraped together every spare dime I could find, and bought 30 shares of ZM for just over $100/share.
You know the Zoom story. Although by the end of the year it was down from its almost $600/share high, I had still done very well. By then I had also changed jobs, from being the ED of a Boston non-profit to going back to serve a local church in the Boston metro area. I had to sell what I had thought was going to be my retirement home on Cape Cod and moved into the parsonage in the parking lot of the church I am now serving.
I also don’t need to tell you what real estate was like at the end of 2020. I sold my house in less than 24 hours and went to employer-provided housing. I had money that needed a home. Feeling pretty good about myself from my Zoom investment (which I still held), I decided that maybe my poor math skills could be outsourced to someone else and I could follow the knack I’ve always had for sussing out what kind of thing is popular. I googled “Stock Advisor” and landed at TMF.
THE ROLLER COASTER
On December 31, 2020, with The Motley Fool recommendations by my side, I began putting the money from the sale of my home to work. Here’s the short version of the crazy ride that ensued:
I didn’t yet know the difference between the free articles on TMF and actual recommendations. So I bought what I liked from those articles. At 61 I bought what I understood to be best for my age and stage. Low risk. Dividends. Established companies.
I have an intense 24/7/365 job, but I made sure to read every free post on TMF every day.
“Wait a minute!” I thought, somewhere around the end of February. I bet I already own every one of these things through my pension fund. I looked. Exactly right.
I learned that the free articles on TMF were different from the official recommendations. I bought TMF services that interested me. They each made me agree to own at least 20-25 of their recommendations. What do I know? I sold the safe, dividend stocks I had bought and did what they said.
I stopped reading all the free posts and dove into MFLive, watching videos and listening to podcasts well into the night, learning what was important in evaluating a company, what to look for in an earnings call, learning investing terms like a new language.
By the end of May 2021, I owned 51 companies. I couldn’t keep up. I started using my brain instead of blindly following. “No, sorry Tom Gardner, it makes no sense for me to own a SPAC that doesn’t even have an identified target yet.” “Nope, sorry again. Not buying anything with that person’s name attached.” “Nope, no Russia. No China. Their governments are too risky.” And so on.
By June 2021 I was down to around 30 companies. Then someone in one of the services I belonged to posted about “Saul’s board.” Everyone seemed to know who/what that was. I didn’t and asked. Came here and began to read.
A few of the stocks I already owned were favorites here, but lots were not. I finally sold ZM along with the majority of other companies that I held to adopt this clearly successful way of investing. So the second almost total sell off of my holdings within the first half of 2021.
I bought favorites here that I did not own. Because everyone said, here and on the regular MF site, that I shouldn’t care about valuation. Stocks go up–maybe dips here and there–but that had been my experience. The charts over the past few years proved it.
At the end of 2021, even with stocks beginning to slide in November, I had still made money. I trimmed some of my Upstart position to come back to square for tax-loss harvesting.
You know the dismal story of last year. Everything I owned, I had bought high. And the roller coaster peaked and went straight down. When it became clear that was the trajectory, I sold some things that I knew I could buy back lower after the wash sale. And I did. Only to see them go lower still.
Everyone here was trimming, selling, some going to mostly cash. I sold quite a bit, every single thing at a loss except for NVDA. I sealed in huge losses in 2022. I’ll have a built in tax deduction for the rest of my natural lifetime.
Even so, by the end of the year, there was not a single share of any company in my portfolio that I could sell for a profit. Not one. The price was below the lowest price I had paid for every share of every company I owned.
No relief from looking back to a healthy cushion from years past. I ended 2021 even. No gain, no loss. Just vast, ugly loss.
It’s already been a long year, but here’s where my portfolio stands right now. I’ll make two lists. The first of the companies by the percentage of my portfolio. The second by how far each is off my cost. Both are as of today.
Companies by % of portfolio
A tiny position in AI, which I hold for my brother makes up the difference.
Companies by total gain/loss since inception
(Hint: It’s all loss, although better today than at year’s end.)
The companies I’ve held the longest are Cloudflare, which I first bought on 2/1/21 and Crowdstrike, which I bought on 2/10/21. I first bought Upstart on 4/15/21 and Datadog on 6/1/21. They are the only four I have held throughout the madness.
The Trade Desk and Global-e I held in 2021, sold and bought back much lower in 2022.
PCT is PureCycle Technologies. I bought that for the first time last fall.
Most of the companies I own have been scrutinized in many, many posts by those much wiser than I. I’ll add notes on just a couple. Charts and details will have to wait, since work calls.
Global-e Online (GLBE) is an Israeli company that helps merchants sell direct to consumer cross-border. They handle every headache you can imagine, from currency conversions to localized websites to logistics and much, much more.
They have acquired a couple of companies in the last year: FLOW, which was their main competition and, most recently, Border-Free, in order to pick up their North American market, which has been small to date. They have a strong partnership with Shopify, which owns GLBE warrants, and on the call they announced an expanded partnership with LVMH brands. As you likely know, the owner of LVMH was recently promoted to become the richest man in the world. That partnership is a big deal.
More on GLBE in its own post when I have time. People here won’t like their gross margins (although they are improving every quarter), but the rest of the numbers look pretty decent to me, especially given the macro, and their future looks bright.
The one that is most unfamiliar to this board is PureCycle Technologies (PCT). They went public in March of 2021 as a spinoff from the R&D department at Proctor and Gamble. Not a candidate for this board, although maybe someday.
What do they do? From their website:
PureCycle offers the only ground-breaking, patented process for recycling polypropylene that separates color, odor, and other contaminants from plastic waste to transform it into ultra-pure recycled resin. This process helps close the loop on plastic waste while making recycled plastics more accessible at scale.
They are about to open their first plant in Ironton, OH. They got hit after earnings because a key piece of equipment needed to get the plant up and running was stuck in Germany and they had to delay the plant opening from Q4 to Q1. That equipment, a single extruder, was delivered in mid-December ahead of schedule, so I expect a better response to their Q4 earnings call. But they are pre-revenue and the future is untested.
With other plants under construction in Georgia and South Korea, deals with quite a few sports stadiums to take all their plastic waste, and federal authorizations for categories of plastic that currently are not able to be recycled at all, I think they’ll do well.
The sports stadiums is a really brilliant strategy, I think. Every team produces (literal) tons of branded plastic stuff to sell to fans, much of which never leaves the stadium. PureCycle will take all that, turn it back to pure resin, and then sell it back to the stadiums to make the stuff all over again. That allows each team to honestly say that their items are made from 100% recycled plastic. Win/win.
They’re the piece of my portfolio that provides some balance, since they tend to trade with the Dow, even though they’re listed as “clean tech” on the Nasdaq. Here’s an SA article on it from earlier this month.
I’m out of time; but that’s my story. My congregation is grateful that I won’t be retiring anytime soon!