September was not such a good month for the markets with the S&P 500 $SPX500 losing 4.75%. Our portfolio did better losing only 2.27%.
The first stock I'm buying in October 2021 is Freeport-McMoran $FCX . This is a stock I've been buying since last year and is the second best performing stock after GameStop $GME . Why did I buy Freeport-McMoran? Because I'm bullish on Copper $COPPER .
Demand for Copper is rising rapidly because of renewable energy and EV without enough supply, creating a supply gap. I've looked at most copper miners last year and invested in Freeport-McMoran since it was the most undervalued and it is very sensitive to Copper prices (good to own in a bull market). However, recently copper prices have been falling, allowing us to buy more of Freeport-McMoran.
The second stock I'm buying in October 2021 is Genworth Financial $GNW . Its subsidiary Enact had its partial IPO and now is valued at nearly $4 billion, while Genworth still has a market cap of less than $2 billion. This is a market inefficiency and Genworth is a prime example of a deep value stock. Enact is the Mortgage Insurance business of Genworth Financial and there are many tailwinds on the industry. This will be good for Genworth too. From the IPO, they were able to raise $535 million, which they used to repay part of their debt.
The main reason why the stock price of Genworth Financial is so low is that the market is worried about the rising liabilities of the Life Insurance business but that doesn't mean that the value should be negative.
The third stock I'm buying in October 2021 is Discovery $DISCA . This is a special situation stock as Discovery is going to merge with AT&T's Warner Media. I started buying Discovery before the merger announcement as it was undervalued. It is still undervalued.