Portfolio Update 8/28/21 6AM
It’s been a month since I posted my last portfolio update found here; https://discussion.fool.com/retirementdough-july-portfolio-updat…
I have found doing these updates is helping me keep better records of my investing thought processes over time. Much like keeping a journal in life when you re-read in the future it helps you remember what your thoughts were at the time of writing. Hopefully others find this helpful as well.
Current Portfolio as of 8/28/21. Change since 7/31/21 +9.2% YTD +18.8% VTI Monthly +2.7% YTD +19.6%
I have decided to just benchmark versus the VTI which is Vanguard Total Stock Market Index Fund, which is probably what I would put my money into if I did not want to spend time researching stocks. VTI includes all 3600 stocks traded in market.
Stock % Portfolio % Portfolio % Change Market Current Previous Portfolio Cap (B) UPST 49.0 13.4 +34.6 21.2 TCNNF 48.3 35.9 +12.4 3.6 TDOC 2.7 16.4 -13.7 22.5 CASH 0 6.4 -6.4
New positions since last portfolio update: NONE
Exited positions since last update: SKLZ, INTZ, GAN, DDOG, DOCU
Traded position: ZI, EXPI
Trades between 7/31-8/28 Bought: ZI 8/3 59.00 TCNNF 8/13 31.58 TCNNF 8/17 27.25 TCNNF 8/20 26.80; 26.90; 27.00 UPST 8/4 131.47 UPST 8/13 196.28; 191.08 UPST 8/19 193.76 UPST 8/20 196.15; 196.85 EXPI 8/6 48.48 Sold: ZI 8/13 62.25 SKLZ 8/4 12.83 GAN 8/4 15.52 EXPI 8/12 51.74 DOCU 8/13 297.00 TDOC 8/13 145.32 TDOC 8/20 139.50 INTZ 8/6 4.62 DDOG 8/13 137.25
Thoughts on trades and companies for the month.
I want to start by saying I obviously have an extremely high tolerance for risk. Do not follow my lead. If you think I am crazy that is your right but please do not clog up the boards with expressing it. I thought about not posting my portfolio this month. I do not want to negatively influence some newer investors, that do not understand risks of investing or that are not use to large swings in the value of their portfolio doing something similar to me. Also I thought now half my portfolio is in a stock not supported by this boards rules so is it really appropriate to continue posting my updates here. However, I think it will be good to continue to report here for no other reason than community learning. If my portfolio crashes and burns or soars it will be documented and we can learn together.
I think it is important to mention that I have five years of living expenses set aside which is not reflected in my portfolio. I have no personal debt of any kind; no car or house payments. My kids college expenses are set aside. I own multiple businesses and have an extremely healthy annual income. If half my portfolio were to crash and burn, it would not effect my current or future lifestyle one bit.
This past month I decided I wanted to go all in on two companies for two different reasons. I sold gan, intrusion and skillz which where recent small positions to my portfolio. I realized quickly that these companies really were not special and I had better places for my money. Expi holdings and Zoom Info were quick in and outs due to the fact that after Trulieve’s and Upstarts earnings I had made up my mind that I wanted to go overweight in those companies.
This thinking also lead to me liquidating my positions in some longer held companies such as Datadog and Docusign. I do think that Datadog and Docusign are great companies and will be great long term investments but I have been struggling with their valuation (as I calculate value) versus other places for my money. It might sound crazy to some but holding some of these companies made me feel more uneasy about the short to medium term time frame than my current portfolio allocations. I had mentioned in my last monthly update that I had been leaning heavily toward reducing my portfolio down to five positions. I obviously went a bit smaller than that.
TAM 1.4T https://www.nasdaq.com/articles/upstarts-%241.4-trillion-mar…
The most discussed company on the board the last six weeks. I wrote two post below explaining why I saw the company and stock as a good buying opportunity even after it has risen over +400% in price so far this year.
TAM 62.5B (US) https://thedeepdive.ca/bofa-global-cannabis-market-currently…
Trulieve reported 8/12. Their earnings were great. The price went down due to CEO’s husband being convicted on some felony charges not related to the company. I wrote an extremely deep dive on the company after it reported: https://discussion.fool.com/trulieve-update-81521-34905107.aspx
I will summarize this opportunity. Company is valued at what I believe the profits will be over the next three years. Basically the money you spend on buying this business today will be returned in the next three years as company profits. The company is going to reinvest those profits into growing the business, but the point still remains, that is a cheap purchase price. I would buy any business that paid my initial investment back in three years!
TAM in 2026 475B https://www.globenewswire.com/news-release/2021/06/29/225464…
Q Revenue 503m
109% yoy; 41% yoy organic (excludes acquisitions)
Visit fee revenue flat, access fee (subscriptions) revenue up 138% y/y
3.5m visits 28% yoy
Living suite members 715,000 45% yoy
52m members increase of 500k over Q1
Adjusted gross margin up from 62.3 to 68.1 yoy due to increase in subscription fee revenue
I think Teladoc stock is a good value right now if you believe in the company, which I do. However if either Upstart or Trulieve were to drop over 10% from current prices I will sell my shares and buy more of the other two companies.
I currently am holding three positions with majority of money in two positions. I tend to range between 6-10 at any given time with 7-9 being the “norm”. Why get so concentrated now? I saw an opportunity in both Trulieve and Upstart for two different reasons. Trulieve is extremely undervalued due to negative speculation that I believe to be unfounded (Bears would disagree with this statement). Upstart is growing so quickly the market is having a hard time valuing it. I felt they both presented an opportunity that I obviously could not pass on.
Risk is a relative term. I know my concentrated portfolio is going to make a lot of posters nervous for me. I feel better right now about my portfolio than I have for the past few months. Will my portfolio be more volatile? Possibly, that is something that does not worry me.
YTD return of portfolio for each month January 18.5% February 20.1% High of year at 35.1% on February 8th March 8.5% April 8.6% May 4.8% Low of year was -0.5% on May 13th June 15.8% July 8.8% August 18.8%
Feel free to email me about thoughts on the companies or questions on my thoughts.