Portfolio One Updated April, 2022

Portfolio one is 20 1/2 years old. The beneficiary contributed $10,000 (net of withdrawals) and the trustee $20,000 for a total of $30,000. The current value is $82,037 for a gain of $52,037 or 173%, which is 8.3% / year when adjusted for the timing of cash flows. Go to the link or here to see details.

This portfolio is down with the others and we can look at a few stocks:

  • Block (SQ) – this is an interesting stock but was hit hard in recent SAAS / payment stock re-valuations
  • Pinduoduo (PDD) – the Chinese tech stocks have been devalued by Chinese government actions, tensions with the USA, and a general re-evaluation of tech stocks
  •  Meta (FB) – Meta’s challenges are well documented as they pivot to Augmented reality – but they still make a lot of profits and have great assets worldwide
  • Rocket (RKT) – we sold half our rocket when they hit a “meme stock” high which is good in hindsight.  The stock pays a strong dividend but is hit hard by the impending raise in interest rates which chokes mortgage growth and refinancing
  • Alibaba (BABA) – like PDD this stock suffered from a triple whammy
  • Paypal (PYPL) – one of the most perplexing on the list, PayPal fell instantly out of favor with analysts after stopping guidance the shares cratered without a significant negative event in the business
  • OKTA (OKTA) – this software company had an acquisition the market didn’t like and then was hit with the overall re-evaluation of software companies valued by growth not profits

Portfolio Five Updated April 2022

Portfolio five is 12 1/2 years old.  The beneficiary contributed $6500 and the trustee $13,000 for a total of $19,500.  The current value is $35,277 for a gain of $15,766 or 80%, which is 8.2% / year adjusted for the timing of cash flows.  Go here or to the link on the right for more details.

Portfolio five has been impacted by the market decline, as follows:

  • We made some purchases earlier in the year of Appian (APPN), Intel (INTC), Block (SQ) and SNAP (SNAP) that fell 30% – 50% after the purchase.  We will look again these stocks
  • We bought Activision (ATVI) which did well (up 20%) with an acquisition offer from Microsoft; we should sell at this point
  • Cloudflare (NET), OKTA (OKTA) and PayPal (PYPL) have all been impacted recently.  Cloudflare fell far but came back.  OKTA made an acquisition that the market did not like and was hit by a hack and the general decline in software valuations.  PayPal stopped giving forward guidance and was hit hard by the market.  We will re-look at these stocks

Portfolio Four Updated April 2022

Portfolio four is 12 1/2 years old.  The beneficiary contributed $6500 and the trustee $13,000 for a total of $19,500.  The current value is $45,993 for a gain of $26,494 or 136%, which is 11.7% / year adjusted for the timing of cash flows.  See the details here or at the link on the right.

Some of the stocks have declined based on recent market events and are being reviewed including:

  • Block (SQ) is a new holding that declined since we bought it
  • Cloudflare (NET) is an innovative software company that went up a lot and then lost significant value
  • OKTA (OKTA) is a software company that had been a great performer for a long time but recently was hit by the re-valuation of software growth companies, an acquisition the market didn’t like, and a hack

Portfolio Eight updated April 2022

Portfolio 8 is 6 1/2 years old. The beneficiary contributed $3500 and the trustee $7000 for a total of $10,500. The current value is $15,449 for a gain of $4949 or 47% which is 9.7% / year. See details here or in the link on the right.

Like the market as a whole our stocks have gone down recently.  Some items under review:

  • New purchases Block (SQ) and Nike (NKE) have gone down since we purchased them
  • OKTA (OKTA) had been a great performing stock but they went down with the high growth software stocks as well as an acquisition the market did not agree with and a recent hack
  • Paypal (PYPL) was another well performing stock that fell significantly when they had an earnings call and offered cautions on future growth

Portfolio Six Updated March 2022

Portfolio Six is 9 1/2 years old.  The trustee contributed $10,000 and the beneficiary $5000 for a total of $15,000.  The current value is $25,192 for a gain of $10,192 or 68%, which is 9.2% / year adjusted for the timing of cash flows.  You can see performance here or on the link on the right.

Some stocks are on watch.  Paypal (PYPL) had a huge price crash based on forward guidance (not a change in their business model), dropping more than 60% from its highs.  OKTA (OKTA) is down about 40% off its highs, along with more of the speculative tech stocks (those that trade at a multiple of revenues not earnings).  Some other stocks have gone off their recent highs but still trade at significant increases from where we’ve bought them (TSM and NVDA).

Portfolio Five Updated November 2020

Portfolio Five is 11 years old.  The beneficiary contributed $6000 and the trustee $12,000 for a total of $18,000.  The current value is $31,765 for a gain of $13,865 or 77% which is 8.5% / year adjusted for the timing of cash flows.  Go here or to the link on the right for more detail.

Gains in the portfolio have been driven by Appian (APPN) which has had a huge run up lately, Cloudflare (NET), Nvidia (NVDA), OKTA (OKTA), Paypal (PYPL), Alibaba (BABA), Union Pacific (UNP) and Procter and Gamble (PG). There are 17 stocks in total in the portfolio, the others are doing OK or are too new to rate. SAP (SAP) was hit recently with their earnings report but is still up overall, and Alibaba (BABA) is still up significantly but fell with the deferral of the ANT IPO.

Portfolio Six Updated November 2020

Portfolio Six is eight years old.  The beneficiary contributed $4500 and the trustee $9000 for a total of $13,500.  The current value is $20,150 for a gain of $6,650 or 49%, which is 8% / year when adjusted for the timing of cash flows.  Go to the link on the right or here to see the details.

Gains have come from OKTA (OKTA), Taiwan Semiconductor Manufacturing (TSM), Nvidia (NVDA), Union Pacific (UNP) and Procter and Gamble (PG).  There are a total of 13 stocks in the portfolio; the others are doing OK or it is too early to tell.

Portfolio Eight Updated November 2020

Portfolio Eight is 5 years old.  The beneficiary contributed $3000 and the trustee $6000 for a total of $9000.  The current value is $14,361 for a gain of $5,361 or 60%, which is 13.5% / year when adjusted for the timing of cash flows.  Go here or the link on the right to see details.

Performance has been driven by gains in Mastercard (MA), Nvidia (NVDA), Paypal (PYPL) and OKTA (OKTA).  There are a total of 10 stocks in the portfolio.  Generally the other stocks are performing adequately or it is too early to tell.

Portfolio Performance As of May 2020 and Replacement Stock Selections

The stock market has recovered almost all of the losses incurred with the pandemic.  From peak to trough (Feb 2020 to March 2020) we lost about 23% of our value.  Today, we are down about 7% from peak.  Our percentages do not completely align with the market because some portfolios hold up to 20% cash and some bond investments (BND ETF from Vanguard) and Gold (IAU ETF ticker).  This performance generally aligns with riding the market down and then back up again.Portfolio Performance May 10 2020

Whether by luck or design, our portfolios did not hold most of the industries that bore the brunt of the Covid impact, like airlines, hotels, and commodities. We did have some stocks that we recently sold in some of these hard hit areas.

I reviewed the rest of the portfolio and we are continually “pruning down” the list of stocks that we hold. There are about 30 stocks held across the portfolio right now, down from about 40 or so in the relatively recent past. This does not include ETF’s.

The stocks that have driven the most value in the portfolio that are not bought across all the portfolio (because every beneficiary selects individually) are:

  • Electronic Arts (EA) – videogames
  • Mastercard (MA) – electronic payments & credit cards
  • CME Group (CME) – financial services
  • Alibaba (BABA) – Chinese e-commerce giant
  • Nvida (NVDA) – semiconductors
  • OKTA (OKTA) – SAAS provider of security services
  • Paypal (PYPL) – electronic payments
  • Procter & Gamble (PG) – iconic brand company
  • Taiwan Semi-conductor (TSM) – semiconductors
  • Union Pacific (UNP) – Railways
  • Gold ETF (IAU) – tracks price of gold

If the portfolios that are selecting new stocks don’t currently own one of the stocks listed above, they may want to consider buying them.

New stocks for May 2020:

  • Carrier (CARR) – manufacture and sale of Heating and cooling systems (HVAC).  Recently spun out from a conglomerate
  • Facebook (FB) – owner of Facebook, Instagram, and WhatsApp seems to have recovered from past controversies
  • Cloudflare (NET) – security and edge networking has been growing with the crisis

Stocks To Pick:

Portfolio Four – select three stocks

Portfolio Five – select two stocks

Portfolio Six – select one stock

Stock Selections for 2019

This year we will have two lists of stock selections.  The first list will be a small list of new selections for 2019, split between US and foreign companies.

The second list will have stocks that are from existing portfolios to choose from, splits between US and foreign companies, if the individual portfolio doesn’t already have these stocks (we want diversification until you get to 15 or so stocks).

New Selections for 2019 – US:

  1. OTKA (OKTA) – OKTA is a software provider of access and authentication solutions for businesses.  OKTA pays no dividends.  It has been on a great run and is used by many major corporations.  It recently went down about 25% from all time highs which is a better price point to purchase.  A new competitor, PING, recently went public and saw its valuation go up, as well (OKTA’s market cap is about 10x bigger)
  2. Abbvie (ABBV) – Abbvie is a pharmaceutical company with a high dividend of almost 6% whose stock price went down almost by half after a recent merger, although it recently recovered some of the loss.  This also may be a good price point to purchase the stock.
  3. Starbucks (SBUX) – Starbucks is an iconic US brand.  The stock pays a modest dividend of 1.6%.  They are focused on profitable growth.

New Selections for 2019 – Non US

  1. BHP (BHP) – BHP is an Australian natural resources (mining / commodities) giant with a high 5.2% dividend.  They are diversified and well run (some competitors like VALE have had significant challenges recently)
  2.  Accenture (ACN) – Accenture is a world wide consulting and outsourcing company headquartered in the Bahamas with a modest 1.5% dividend.  About half their revenues are from North America.  They are well run and a leader in the consulting space

Stocks in US Portfolio to Consider (if not owned already):

  • American Electric Power (AEP) – Utility with 2.8% dividend
  • CME Group (CME) – futures exchange with combined dividends and special dividends more than 3% annually
  • Facebook (FB) – software company with excellent stock performance even after all the publicity.  Paying a few billion for Instagram may be one of the best purchases ever
  • Gold ETF (IAU) – gold does not pay a dividend but the price of gold has recently started rising with risk and high levels of debt behind major countries
  • Coca Cola (KO) – Coke pays a 2.9% dividend and is well run and focused on profits
  • Mastercard (MA) – Mastercard benefits from the rise in mobile payments and move away from checks and cash, and pays a very small 0.5% dividend
  • Procter & Gamble (PG) – Procter and Gamble owns and manages many brands and has a solid 2.5% dividend
  • PayPal (PYPL) – PayPal has done well since its split from EBAY (pays no dividend)

Non US Stocks in Portfolio to Consider (if not owned already):

  • Alibaba (BABA) – Chinese ecommerce giant (no dividend)
  • Taiwan Semiconductor (TSM) – Taiwanese chip builder with high 3.6% dividend
  • Unilever (UL) – European company that owns and manages brands with a good 3% dividend

Stock Selections per Portfolio:

  • Portfolio One – to discuss (significant amounts in cash)
  • Portfolio Two – ETF’s and cash, to discuss (40% cash now)
  • Portfolio Three – will move away from stocks and into ETF’s.  Will discuss between VTI (US), VEU (Non US), HEFA (Non US hedged), cash, and IAU (Gold)
  • Portfolio Four M – 3 stocks
  • Portfolio Five D – 4 stocks
  • Portfolio Six – 3 stocks
  • Portfolio Seven G – 2 stocks
  • Portfolio Eight K – 2 stocks