Portfolio Three is on its 4th round of annual investing, meaning that it is a bit older than 3 years. This portfolio started during one of the most tumultuous times in the stock market, at least during my investing lifetime.
Total investment in this portfolio is $6000, with $2000 from the beneficiary and $4000 from me. In 2007 we sold China Mobile during what looked like a peak (still is far below that price, so it was a peak to date) but then got clobbered in 2008. With only a few stocks in the portfolio, it is at risk of total performance if even one stock does badly, and Nokia (NOK) just plummeted and frankly, like with portfolio two, we didn’t pull the plug on that stock soon enough. NOK just let its lead in mobile technology slip away when it missed the iPhone and next generation of smart phones and owning a large share of commodity phones with low margins won’t cut it. Also for those that view dividends (high dividends) as a path to wealth of course as the stock plummeted the dividend went down with it; you need earnings to support that dividend in the first place.
Recently with all that we are finally about back to break even; the portfolio is worth about $5900 (out of an investment of $6000).
Recent investments in overseas companies with ADR’s like Siemens (SI) and more recently a Canadian Bank (CM) and a Chinese oil company (CEO) have done well in the stock market run-up. Since most every issue has gone up (but the Chinese oil stocks in particular) it doesn’t take a genius to do well with the rising tides but it does feel good to get within a hair’s breadth of break even in this portfolio (as in “mattress status”, comparing against what would happen if you put the money under your mattress, a sad benchmark but relevant in these times).
With 5 stocks, the portfolio is still subject to large swings due to performance of a single stock, and we will watch them and not let them fall like we did with NOKIA, lesson learned there.
Another good thing about this portfolio is that we are able to do no-commission stock buys and sells, and there is not an annual fee for having the portfolio. Not having these charges adds up over time (they are essentially subsidized by my other accounts at the provider, which is fine with me).