The aim of a portfolio is to beat the market $SPX500 over the long-term but you also want to avoid the volatilities of the markets so that you have enough money to buy stocks during a market crash. For example, when the markets crashed in March by 35%, it would not have been a good idea to sell my stocks to buy other cheaper stocks. That's why it is important to have a diversified portfolio with securities with low correlation among each other.
I have 22 securities in my portfolio including 14 stocks, they are in 7 different categories:
1. US Stocks 31.5%
2. Non-US Stocks 12.9%
3. Commodity Stocks 15.5%
4. Workouts 7.3%
5. Precious metals 7.0%
6. Bonds 17.7%
7. Cash and Cash equivalents 8.1%
The largest position in my portfolio is Skyworks Solutions (13.7%). This is a bet on 5G.
GameStop (5.2%): This is pure value play. This is a cyclical stock. I'm waiting for the new console cycle and the possibility of a short squeeze.
JPMorgan Chase (4.4%): This is my favorite stock in my portfolio. Even with the low interest rates environment, JPMorgan Chase has been able to make money through their credit card business.
Alaska Air Group (5.6%): This is only a recent addition to my portfolio. Alaska Airlines is one of the airlines with the best balance sheet and the fact that they operate only in the US, they will recover faster than competitors.
Apple $AAPL (2.5%): My profits on Apple are over 150%. I first bought Apple in 2016 and bought even more shares in 2018 when everybody was selling. It became the largest position in my portfolio at 15%. Eventually, I took profits as the stock became expensive.
Qudian (1.9%): Worst performing stock in my portfolio. This is a Chinese fintech company. The stock is not doing great at all but it is still undervalued and a good value stock for the long-term.
South Korean ETF EWY (5.5%): I am bullish on South Korea in general and not any particular company. South Korea is one of the fastest growing developed economies. The government debt is low, it is very innovative and stocks are cheap there.
China Mobile (2.9%): Largest network operator in the world but underperforming stock.
Brazilian ETF EWZ (2.8%): Brazil is one of the developing economies with a very cheap stock market. This is a risky investment.
Parsley Energy (2.7%): This is an oil $OIL company with exclusive operations in the Permian Basin. Most of the debts of the company are due after 2025. They have stopped new oil production as oil prices are low. This is something good as it is better to produce oil when prices are high.
Concho Resources (1.6%): Another oil and gas company with operations in the Permian Basin. It is larger than Parsley Energy with more exposure to natural gas.
Polymetal International (9.7%): This is a Russian gold and silver miner. It is the second largest gold miner in Russia and third largest silver miner in the world. Producing gold in Russia is cheap and they have good margins.
Freeport-mcMoRan (2.5%): This is a copper miner. I'm betting on higher copper prices as well as Copper is in high demand in renewable energies and electric vehicles. also, in the developing world, electrification and construction will lead to higher copper demand. With supply unable to meet the demand, we may have a supply gap.
Caesars Entertainment (2.4%): This is an arbitrage deal. Caesars Entertainment will be acquired by Eldorado Resorts in a cash and stock transaction.
Fitbit (2.5%): arbitrage deal. Fitbit is going to be acquired by Google in an all cash transaction.
Tiffany & Co. (2.5%): Arbitrage deal, Tiffany's will be acquired by LVMH in a cash transaction.
Gold $GOLD (3.3%): Instead of being in cash or even bonds, it is better to have some exposure to gold in my opinion. It is through the GLD ETF.
Silver (3.7%): The oldest ratio in history, the gold to silver ratio is at all time high. That's why I believe that owning some silver is also a good idea.
TLT ETF: 9.1%
IEF ETF: 4.3%
HYG ETF: 2.1%
LQD ETF: 2.2%
The bonds in my portfolio are only here until I find good deals in the market.
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