ETFs Of The Month: HIBL, SOXL

This month, I bought two new triple-levered ETFs - HIBL and SOXL, representing high-beta and semiconductor stocks respectively - under the investing thesis previously posted here.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 25/75 split between stocks and yield.  As seen below, it is currently 38/62.

I am in no rush to flip into yield. I would rather let my winners run forever.  However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, leveraged ETFs and/or covered call ETF/Ns. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.09T market cap
• no dividend
• $477.8B revenue
• 7% revenue growth
• $66.4B cash
• $147.3B debt
• $39.3B operating cash flow
• $-9.0B free cash flow

Microsoft (MSFT)

• $1.89T market cap
• 0.9% dividend yield
• $192.6B revenue
• 18% revenue growth
• $104.7B cash
• $78.0B debt
• $87.1B operating cash flow
• $48.9B free cash flow

Here's my current portfolio (buy, hold, and sell).  As always, I believe in all of these stocks/ETF/ETNs - until I sell them.

Microsoft (MSFT) 15.00%

Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (USOI) 14.13%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 11.68%

Global X U.S. Preferred ETF (PFFD) 11.26%

Amazon (AMZN) 10.12%

Invesco NASDAQ 100 ETF (QQQM) 6.55%

Global X NASDAQ 100 Covered Call ETF (QYLD) 6.01%

Credit Suisse X-Links Silver Shares Covered Call ETN (SLVO) 5.89%

Global X Russell 2000 Covered Call ETF (RYLD) 5.16%

Global X S&P 500 Covered Call ETF (XYLD) 4.08%

Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) 3.61%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.49%

UnitedHealth Group (UNH) 1.80%

Costco Wholesale (COST) 1.69%

ProShares UltraPro QQQ (TQQQ) 0.11%

ProShares UltraPro S&P 500 (UPRO) 0.07%

ProShares UltraPro Russell 2000 (URTY) 0.06%

Direxion Daily CSI China Internet Bull 2X Shares (CWEB) 0.05%

Direxion Daily S&P Biotech Bull 3X Shares (LABU) 0.03%

Direxion Daily Semiconductor Bull 2X Shares (SOXL) 0.01%

Direxion Daily S&P 500 High Beta Bull 3X Shares (HIBL) 0.01%

Selling The Drama: HYLB

And to right or wrong
And to weak or strong
It is known, just scream it from the wall

I've willed, I've walked, I've read
I've talked, I know, I know
I've been here before

In September 2020, four triggered sales marked the beginning of my portfolio's major flip from growth to income.  At that time, I was attempting to do the right thing - in this case, not being greedy and preserving my gains.  If I had a large banner reading MISSION ACCOMPLISHED handy at that moment, I would have unfurled it over my computer desk as the transactions executed.

Fast forward 1.5+ years to the present day: a reassessment is warranted.  My intentions were good.  And if the growth stocks that I sold didn't continue to grow like they had, I would have been correct in my actions.  But they did, and therefore I was not.  I was too conservative.

I could say I made a mistake - and in monetary terms, I certainly did - but instead I'll just say that I made a non-optimal decision.

Today, I've begun the unwinding of that decision.  I've sold a substantial chunk of my HYLB to fund a purchase of my favorite group of ETF/Ns:  GLDI, SLVO, USOI, QYLD, RYLD, and XYLD.  I believe these to be more risk-appropriate.

Another key reversal from my previous decisions is that this is a partial sale.  I've justified "when selling a holding, sell every share" for two reasons:

• why hold on to something I don't believe in 100%?; and
• simplification of bookkeeping.

To which I can now offer this rebuttal:

• the lack of belief may be misguided; and
• the tax consequences of selling everything can be significant.

And so accordingly; HYLB, PFFD, USHY, and any other positions that I will exit in the future will be unwound over time.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 25/75 split between stocks and yield.  As seen below, it is currently 38/62.

I am in no rush to flip into yield. I would rather let my winners run forever.  However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, leveraged ETFs and/or covered call ETF/Ns. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.18T market cap
• no dividend
• $477.8B revenue
• 7% revenue growth
• $66.4B cash
• $113.3B debt
• $39.3B operating cash flow
• $18.0B free cash flow

Microsoft (MSFT)

• $2.07T market cap
• 0.9% dividend yield
• $192.6B revenue
• 18% revenue growth
• $104.7B cash
• $78.0B debt
• $87.1B operating cash flow
• $48.9B free cash flow

Here's my current portfolio (buy, hold, and sell).  As always, I believe in all of these stocks/ETF/ETNs - until I sell them.

Microsoft (MSFT) 15.31%

Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (USOI) 7.53%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 11.68%

Global X U.S. Preferred ETF (PFFD) 10.95%

Amazon (AMZN) 9.42%

Invesco NASDAQ 100 ETF (QQQM) 6.60%

Global X NASDAQ 100 Covered Call ETF (QYLD) 6.44%

Credit Suisse X-Links Silver Shares Covered Call ETN (SLVO) 6.05%

Global X Russell 2000 Covered Call ETF (RYLD) 5.38%

Global X S&P 500 Covered Call ETF (XYLD) 4.29%

Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) 3.70%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.47%

UnitedHealth Group (UNH) 1.84%

Costco Wholesale (COST) 1.83%

ProShares UltraPro QQQ (TQQQ) 0.09%

ProShares UltraPro S&P 500 (UPRO) 0.06%

ProShares UltraPro Russell 2000 (URTY) 0.05%

Direxion Daily CSI China Internet Bull 2X Shares (CWEB) 0.03%

Direxion Daily S&P Biotech Bull 3X Shares (LABU) 0.02%

Direxion Daily Semiconductor Bull 3X Shares (SOXL) 0.03%

Direxion Daily S&P 500 High Beta Bull 3X Shares (HIBL) 0.02%

ETFs Of The Month: CWEB, LABU

Back in June 2021, I asked myself the question "why not dollar-cost average monthly into triple-levered index funds for the next several decades?" - a question so good that I didn't want to know the actual answer - and began a commitment to ongoing purchases of TQQQ, UPRO, and URTY for the foreseeable future.

Nearly a year later, those "risky" investments have not blown up (yay!) and I began to look for additional leveraged investments outside of the indices.  This plan calls for all of the following:

• Monthly dollar cost averaging, a strategy that has served me well for my first two decades of investing, DCA is an absolute necessity when dealing with...
• Investment vehicles subject to significant daily/monthly volatility, which double- and triple-leveraged ETFs certainly qualify for, hence the advertised "risk".  To be clear:  the short-term downside potential is a feature, not a bug, when coupling the magic powers of DCA with...
• Massive multi-decade outperformance potential (duh).

So I put on my Warren Buffett/Rip Van Winkle hat and found two instruments of choice:  SynBio via LABU, and China via CWEB (an investment of which Charlie Munger might approve).

As one last step before diving into the pool that I had dipped my toes in, I asked myself the follow-up question:  "is this really going to work?  really?"  The short answer is yes; the long answer is here, which itself contains links to math and other details that underline the premise that I intuitively knew to be correct immediately upon asking the original question.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 25/75 split between stocks and yield.  As seen below, it is currently 41/59.

I am in no rush to flip into yield. I would rather let my winners run forever.  However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, leveraged ETFs and/or covered call ETF/Ns. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.62T market cap
• no dividend
• $469.8B revenue
• 9% revenue growth
• $96.1B cash
• $139.4B debt
• $46.3B operating cash flow
• $-0.8B free cash flow

Microsoft (MSFT)

• $2.26T market cap
• 0.8% dividend yield
• $184.9B revenue
• 20% revenue growth
• $125.4B cash
• $80.4B debt
• $83.9B operating cash flow
• $46.5B free cash flow

Here's my current portfolio (buy, hold, and sell).  As always, I believe in all of these stocks/ETF/ETNs - until I sell them.

Microsoft (MSFT) 15.54%

Amazon (AMZN) 12.01%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 11.02%

Global X U.S. Preferred ETF (PFFD) 10.62%

Xtrackers USD High Yield Corporate Bond ETF (HYLB) 10.19%
Invesco NASDAQ 100 ETF (QQQM) 6.86%

Global X NASDAQ 100 Covered Call ETF (QYLD) 6.19%

Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (USOI) 5.65%

Credit Suisse X-Links Silver Shares Covered Call ETN (SLVO) 5.42%

Global X Russell 2000 Covered Call ETF (RYLD) 4.62%

Global X S&P 500 Covered Call ETF (XYLD) 3.01%

Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) 2.54%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.51%

Costco Wholesale (COST) 1.84%

UnitedHealth Group (UNH) 1.74%

ProShares UltraPro QQQ (TQQQ) 0.11%

ProShares UltraPro S&P 500 (UPRO) 0.05%

ProShares UltraPro Russell 2000 (URTY) 0.03%

Direxion Daily S&P Biotech Bull 3X Shares (LABU) 0.02%

Direxion Daily CSI China Internet Bull 2X Shares (CWEB) 0.02%

On The Turning Away: Sold GOOGL, ISRG, V

Unaware how the ranks have grown
Driven on by a heart of stone
We could find that we're all alone

In the dream of the proud

The sales of GOOGL, ISRG, and V were not easy.  They had annualized returns of 17%, 11%, and 19% respectively, and comprised nearly 10% of of my portfolio's overall valuation.  One might say that they were victims of their own success.   

The proceeds from this sale were (once again) directed into my favorite basket of yield ETF/Ns:  the index covered calls of QYLD, RYLD, and XYLD; and the gold/silver/oil covered calls of GLDI, SLVO, and USOI.

With this most recent rotation from stocks into yield, my portfolio now yields a projected 6% annually.  This could grow as much as to 8% annually.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 25/75 split between stocks and yield. As seen below, it is currently 40/60.

I am in no rush to flip into yield. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, and/or covered call ETF/Ns. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.66T market cap
• no dividend
• $458.0B revenue
• 15% revenue growth
• $79.0B cash
• $155.8B debt
• $54.7B operating cash flow
• $9.3B free cash flow

Microsoft (MSFT)

• $2.36T market cap
• 0.8% dividend yield
• $176.3B revenue
• 22% revenue growth
• $130.6B cash
• $78.9B debt
• $82.0B operating cash flow
• $49.8B free cash flow

Here's my current portfolio (buy, hold, and sell). As always, I believe in all of these stocks/ETF/ETNs - until I sell them.

Microsoft (MSFT) 15.15%

Amazon (AMZN) 11.58%

Global X U.S. Preferred ETF (PFFD) 11.36%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 11.29%

Xtrackers USD High Yield Corporate Bond ETF (HYLB) 11.20%
Invesco NASDAQ 100 ETF (QQQM) 6.98%

Global X NASDAQ 100 Covered Call ETF (QYLD) 6.25%

Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (USOI) 5.22%

Credit Suisse X-Links Silver Shares Covered Call ETN (SLVO) 5.01%

Global X Russell 2000 Covered Call ETF (RYLD) 4.53%

Global X S&P 500 Covered Call ETF (XYLD) 2.94%

Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.66%

Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) 2.42%

Costco Wholesale (COST) 1.70%

UnitedHealth Group (UNH) 1.52%

ProShares UltraPro QQQ (TQQQ) 0.10%

ProShares UltraPro S&P 500 (UPRO) 0.04%

ProShares UltraPro Russell 2000 (URTY) 0.03%

ETNs Of The Month: GLDI, USOI

First, a sale!  Facebook (FB) triggered a sale after declining 20% from its all-time high.  First bought in January 2016, it was repurchased seven additional times but not since May 2018.  It was sold for a 159% gain (17% annualized).  Facebook is a cash cow which seems to have squeezed every imaginable dollar from its current platforms.  Facing an uncertain future with its announced pivot to the Metaverse™ as well as increasing regulatory scrutiny, I am more comfortable owning FB via QQQM and not directly.  

The proceeds from this sale were directed into my favorite basket of yield ETF/Ns:  the index covered calls of QYLD, RYLD, and XYLD; the covered calls of SLVO (silver, previously bought); and new covered calls GLDI (gold) and USOI (oil).

As noted in July, SLVO's yield was an unsustainable 35%; it is currently 28%.  GLDI and USOI are currently yielding 11% and 24% respectively.  Anything above the index covered calls' range of 9% to 12% is a bonus.  Adding GLDI and USOI to SLVO will result in more reliable, less lumpy overall monthly cash flows.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and yield. As seen below, it is currently 54/46.

I am in no rush to flip into yield. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, and/or covered call ETF/Ns. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.73T market cap
• no dividend
• $458.0B revenue
• 15% revenue growth
• $79.0B cash
• $152.8B debt
• $54.7B operating cash flow
• $9.3B free cash flow

Microsoft (MSFT)

• $2.42T market cap
• 0.8% dividend yield
• $176.3B revenue
• 22% revenue growth
• $130.6B cash
• $78.9B debt
• $82.0B operating cash flow
• $49.8B free cash flow

Here's my current portfolio (buy, hold, and sell). As always, I believe in all of these stocks/ETF/ETNs - until I sell them.

Microsoft (MSFT) 16.16%

Amazon (AMZN) 12.48%

Global X U.S. Preferred ETF (PFFD) 11.77%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 11.73%

Xtrackers USD High Yield Corporate Bond ETF (HYLB) 11.60%
Invesco NASDAQ 100 ETF (QQQM) 7.21%
Alphabet (GOOGL) 5.75%

Global X NASDAQ 100 Covered Call ETF (QYLD) 3.79%

Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.82%
Intuitive Surgical (ISRG) 2.69%

Global X Russell 2000 Covered Call ETF (RYLD) 2.43%

Global X S&P 500 Covered Call ETF (XYLD) 2.34%
Costco Wholesale (COST) 1.70%

UnitedHealth Group (UNH) 1.51%

Verizon (VZ) 1.09%

Visa (V) 1.06%

AT&T (T) 0.94%

Credit Suisse X-Links Silver Shares Covered Call ETN (SLVO) 0.84%

Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (USOI) 0.75%

Credit Suisse X-Links Gold Shares Covered Call ETN (GLDI) 0.75%

ProShares UltraPro QQQ (TQQQ) 0.10%

ProShares UltraPro S&P 500 (UPRO) 0.04%

ProShares UltraPro Russell 2000 (URTY) 0.03%

ETN Of The Month: SLVO

This month's choice may seem like a reeeeeeeeach for yield...and perhaps it is.  Having previously dipped my toes into the covered call strategy, I'm now diving in.  My investment thesis is as follows:

• The covered call strategy for monthly dividend income is a successful one, given that the underlying asset will support it.
• Silver is a time-tested store of value; a secondary one to gold, but perhaps relatively undervalued (a currently popular sentiment among a subset of commodity traders).
• Silver is also an essential raw material for technological purposes, which should see increasing demand in the future.

So far, so good.  Now the risk which will throw many red flags:  SLVO's current dividend yield is 35%.  This is clearly not sustainable.  My expectation is that the yield will bounce (down and) around, with a floor in the range of my other covered call investments of 9% to 12%, which is more than acceptable.  In the meantime, I will enjoy the 35% while it lasts.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and yield. As seen below, it is currently 54/46.

I am in no rush to flip into yield. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, and/or index covered call ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.73T market cap
• no dividend
• $419.1B revenue
• 44% revenue growth
• $73.3B cash
• $101.5B debt
• $67.2B operating cash flow
• $31.4B free cash flow

Microsoft (MSFT)

• $2.04T market cap
• 0.8% dividend yield
• $160.0B revenue
• 19% revenue growth
• $125.0B cash
• $81.3B debt
• $72.7B operating cash flow
• $37.8B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Microsoft (MSFT) 13.85%

Amazon (AMZN) 12.89%

Global X U.S. Preferred ETF (PFFD) 12.33%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 12.14%

Xtrackers USD High Yield Corporate Bond ETF (HYLB) 12.03%
Invesco NASDAQ 100 ETF (QQQM) 6.65%
Alphabet (GOOGL) 5.09%

Global X NASDAQ 100 Covered Call ETF (QYLD) 3.34%

Facebook (FB) 3.18%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.96%
Intuitive Surgical (ISRG) 2.65%

Global X Russell 2000 Covered Call ETF (RYLD) 2.28%

Global X S&P 500 Covered Call ETF (XYLD) 2.18%
UnitedHealth Group (UNH) 1.38%

Visa (V) 1.30%
Costco Wholesale (COST) 1.30%

Verizon (VZ) 1.22%
AT&T (T) 1.20%

ProShares UltraPro QQQ (TQQQ) 0.05%

Credit Suisse X-Links Silver Shares Covered Call ETN (SLVO) 0.04%

ProShares UltraPro Russell 2000 (URTY) 0.02%

ProShares UltraPro S&P 500 (UPRO) 0.02%

ETFs Of The Month: TQQQ, UPRO, URTY

Have you ever asked a question that you didn't want to know the "real" answer to?

Such as "why not dollar-cost average monthly into triple-levered index funds for the next several decades?"

My brief research led to the following answer:

The risk with this investing strategy is to sell too late.  An 80-90% decline at some point in the future seems inevitable.  I will be required to time the market by "getting out when the getting is good."  Of course, if the declines occur in the early and/or middle years, DCA'ing will work its magic.

The hedge to this risk is the tiny percentile allocated numbers at the bottom of this post.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and yield. As seen below, it is currently 52/48.

I am in no rush to flip into yield. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond, preferred stock, and/or index covered call ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.63T market cap
• no dividend
• $419.1B revenue
• 44% revenue growth
• $73.3B cash
• $101.5B debt
• $67.2B operating cash flow
• $31.4B free cash flow

Microsoft (MSFT)

• $1.87T market cap
• 0.9% dividend yield
• $160.0B revenue
• 19% revenue growth
• $125.0B cash
• $81.7B debt
• $72.7B operating cash flow
• $37.8B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Microsoft (MSFT) 13.25%

Amazon (AMZN) 12.58%

Global X U.S. Preferred ETF (PFFD) 12.57%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 12.42%

Xtrackers USD High Yield Corporate Bond ETF (HYLB) 12.34%
Invesco NASDAQ 100 ETF (QQQM) 6.42%
Alphabet (GOOGL) 5.12%

Global X NASDAQ 100 Covered Call ETF (QYLD) 3.40%

Facebook (FB) 3.10%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.89%
Intuitive Surgical (ISRG) 2.50%

Global X Russell 2000 Covered Call ETF (RYLD) 2.29%

Global X S&P 500 Covered Call ETF (XYLD) 2.19%
UnitedHealth Group (UNH) 1.46%

Visa (V) 1.31%
Costco Wholesale (COST) 1.28%

Verizon (VZ) 1.27%
AT&T (T) 1.26%

ProShares UltraPro QQQ (TQQQ) 0.03%

ProShares UltraPro Russell 2000 (URTY) 0.01%

ProShares UltraPro S&P 500 (UPRO) 0.01%

ETFs Of The Month: QYLD, RYLD, XYLD

I have sold all of my previous holdings in the iShares Core U.S. Aggregate Bond ETF (AGG) at a slight loss.  The proceeds from this sale, plus some of my existing cash reserves, were used to:

• add the usual monthly purchases of HYLB, QQQJ, QQQM, and USHY;
• add a large "catch-up" purchase to PFFD; and
• initiate purchases in three "Covered Call" ETFs:  QYLD (NASDAQ 100), RYLD (Russell 2000), and XYLD (S&P 500).

These covered call ETFs are an idea I've been looking for ever since I started investing - I've just discovered that they actually exist.  Everybody knows that on average over the long term, the market goes up 8 to 12 percent per year...just not in a straight line.  Covered call ETFs approximate these long term returns by owning the underlying assets (in these cases, stock indices) and selling calls (in these cases, stock index options) against those assets, turning capital gains into monthly dividend payments.  The prices of these ETFs follow the overall performance of the assets, with dampened volatility:  investors are forgoing the potential of excess total returns (and paying an expense ratio of 0.6%) for more immediate cash flows.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 53/47.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.54T market cap
• no dividend
• $386.1B revenue
• 44% revenue growth
• $84.4B cash
• $101.2B debt
• $66.1B operating cash flow
• $36.6B free cash flow

Microsoft (MSFT)

• $1.77T market cap
• 1.0% dividend yield
• $153.3B revenue
• 17% revenue growth
• $132.0B cash
• $82.9B debt
• $68.0B operating cash flow
• $34.8B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Microsoft (MSFT) 12.91%

iShares Broad USD High Yield Corporate Bond ETF (USHY) 12.89%

Global X U.S. Preferred ETF (PFFD) 12.89%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 12.84%
Amazon (AMZN) 12.49%
Invesco NASDAQ 100 ETF (QQQM) 6.11%
Alphabet (GOOGL) 4.63%

Global X NASDAQ 100 Covered Call ETF (QYLD) 3.50%

Facebook (FB) 2.86%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.80%
Intuitive Surgical (ISRG) 2.28%

Global X Russell 2000 Covered Call ETF (RYLD) 2.20%

Global X S&P 500 Covered Call ETF (XYLD) 2.17%
UnitedHealth Group (UNH) 1.40%

Verizon (VZ) 1.39%
AT&T (T) 1.38%
Visa (V) 1.27%
Costco Wholesale (COST) 1.25%

Stocks Of The Month: T, VZ

Going forward:  I will only be posting about stock purchases outside of the regularly-scheduled monthly purchases of HYLB, PFFD, QQQJ, QQQM, and USHY.  (It's going to get really, really boring.)

First...two triggered sales!  I've always thought of Adobe (ADBE) and Autodesk (ADSK) as a pair; they entered my portfolio together in January 2016, and now they have exited together.  Both stocks were similarly outstanding investments as well.  Adobe increased 337% (34% annualized), and Autodesk returned 325% (32% annualized).

This month's stocks are AT&T (T) and Verizon (VZ).  I believe both of these companies are fundamentally undervalued; if each of them were to be built from scratch, the cost would substantially exceed their current enterprise values.  They both generate large cash flows which easily fund generous dividends.  Their telecommunications duopoly represents the level of incumbency that makes for confident investments.  And finally:  the 5G revolution has just begun (i.e. revenues will be growing again soon).

AT&T (T)

• $204.8B market cap
• 7.2% dividend yield
• $171.8B revenue
• -2% revenue growth
• $9.8B cash
• $183.0B debt
• $43.1B operating cash flow
• $36.4B free cash flow

Verizon (VZ)

• $231.8B market cap
• 4.5% dividend yield
• $128.3B revenue
• 0% revenue growth
• $22.2B cash
• $151.2B debt
• $41.8B operating cash flow
• $16.1B free cash flow

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 55/45.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.51T market cap
• no dividend
• $386.1B revenue
• 44% revenue growth
• $84.4B cash
• $101.2B debt
• $66.1B operating cash flow
• $36.6B free cash flow

Microsoft (MSFT)

• $1.75T market cap
• 1.0% dividend yield
• $153.3B revenue
• 17% revenue growth
• $132.0B cash
• $82.9B debt
• $68.0B operating cash flow
• $34.8B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Microsoft (MSFT) 13.02%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 12.83%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 12.76%
Amazon (AMZN) 12.39%
iShares Core U.S. Aggregate Bond ETF (AGG) 11.00%
Global X U.S. Preferred ETF (PFFD) 8.50%
Invesco NASDAQ 100 ETF (QQQM) 5.89%
Alphabet (GOOGL) 4.79%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.68%
Facebook (FB) 2.65%
Intuitive Surgical (ISRG) 2.26%
Verizon (VZ) 1.34%
AT&T (T) 1.34%
UnitedHealth Group (UNH) 1.31%
Visa (V) 1.31%
Costco Wholesale (COST) 1.14%

Stock Of The Month: MSFT

Going forward:  I will only be posting about stock purchases outside of the regularly-scheduled monthly purchases of AGG, HYLB, PFFD, QQQJ, QQQM, and USHY.  (It's going to get really, really boring.)

This month's stock is Microsoft (MSFT), fresh off yet another outstanding quarterly result.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 55/45.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.70T market cap
• no dividend
• $347.0B revenue
• 37% revenue growth
• $68.4B cash
• $96.8B debt
• $55.3B operating cash flow
• $33.7B free cash flow

Microsoft (MSFT)

• $1.83T market cap
• 0.9% dividend yield
• $153.3B revenue
• 17% revenue growth
• $132.0B cash
• $82.9B debt
• $68.0B operating cash flow
• $34.8B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Amazon (AMZN) 13.49%
Microsoft (MSFT) 13.23%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 12.35%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 12.29%
iShares Core U.S. Aggregate Bond ETF (AGG) 10.90%
Global X U.S. Preferred ETF (PFFD) 8.04%
Invesco NASDAQ 100 ETF (QQQM) 5.87%
Alphabet (GOOGL) 4.56%
Facebook (FB) 2.59%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 2.51%
Intuitive Surgical (ISRG) 2.30%
Adobe (ADBE) 1.96%
Costco Wholesale (COST) 1.24%
UnitedHealth Group (UNH) 1.23%
Visa (V) 1.18%
Autodesk (ADSK) 0.75%

(Preferred) Stock(/Bond ETF)s Of The Month: AGG, HYLB, PFFD, QQQJ, QQQM, USHY

I skipped November's post because...excuses. Here's what happened: 

• Bought more AGG, HYLB, PFFD, USHY
• Swapped my previous holdings of QQQ into mostly QQQM (just like QQQ, but with a lower expense ratio) and some QQQJ (an entirely new ETF consisting of "minor-league prospects" of the Nasdaq - it's what one might wish the Russell 2000 to be, instead of the perpetual underperformer that it is).

Detail-oriented readers will note that these same six ETFs are in the title of this post, as they were bought in December as well.

Also, a trigger sale!  Salesforce (CRM) just reported a so-so quarter and a high-priced acquisition of Slack, which sent its stock below my previously-established threshold.  First bought in October 2013 and purchased on three additional occasions, it posted a 178% gain (15% annualized).

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 56/44.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.60T market cap
• no dividend
• $347.0B revenue
• 37% revenue growth
• $68.4B cash
• $96.8B debt
• $55.3B operating cash flow
• $33.7B free cash flow

Microsoft (MSFT)

• $1.63T market cap
• 1.0% dividend yield
• $147.1B revenue
• 12% revenue growth
• $138.0B cash
• $83.2B debt
• $66.2B operating cash flow
• $32.2B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Amazon (AMZN) 13.22%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 12.33%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 12.30%
iShares Core U.S. Aggregate Bond ETF (AGG) 11.07%
Microsoft (MSFT) 10.02%
Global X U.S. Preferred ETF (PFFD) 8.00%
Invesco NASDAQ 100 ETF (QQQM) 4.59%
Alphabet (GOOGL) 4.18%
Facebook (FB) 2.84%
Intuitive Surgical (ISRG) 2.41%
Adobe (ADBE) 2.05%
Invesco NASDAQ Next Gen 100 ETF (QQQJ) 1.90%
Costco Wholesale (COST) 1.35%
UnitedHealth Group (UNH) 1.32%
Visa (V) 1.27%
Autodesk (ADSK) 0.73%

(Preferred) Stock(/Bond ETF)s Of The Month: HYLB, PFFD, USHY

I'm buying yield.

In a few days, I'll receive the first dividend payments from last month's substantial turn from growth to yield. It is...dare I say...kind of exciting!


Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 58/42.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.60T market cap
• no dividend
• $321.8B revenue
• 40% revenue growth
• $71.4B cash
• $91.4B debt
• $51.2B operating cash flow
• $33.7B free cash flow

Microsoft (MSFT)

• $1.59T market cap
• 1.1% dividend yield
• $143.0B revenue
• 13% revenue growth
• $136.5B cash
• $82.1B debt
• $60.7B operating cash flow
• $34.3B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Amazon (AMZN) 13.64%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 11.75%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 11.73%
iShares Core U.S. Aggregate Bond ETF (AGG) 10.79%
Microsoft (MSFT) 10.13%
Global X U.S. Preferred ETF (PFFD) 7.47%
Invesco QQQ Trust (QQQ) 3.72%
Alphabet (GOOGL) 3.52%
Facebook (FB) 2.75%
Intuitive Surgical (ISRG) 2.32%
Adobe (ADBE) 2.13%
Salesforce (CRM) 1.81%
Costco Wholesale (COST) 1.34%
Visa (V) 1.28%
UnitedHealth Group (UNH) 1.25%
Autodesk (ADSK) 0.63%

The End Of The Innocence: Sold TSLA, NVDA, AAPL, AMD

Remember when the days were long
And rolled beneath a deep blue sky
Didn't have a care in the world

I've been meaning to write my September update for a while now, but things kept on happening...

On September 1st, I bought (more) of AGG, HYLB, PFFD, and USHY.

On September 4th, the first of my recently-established stop-losses triggered for TSLA.  I used the (substantial) proceeds from this to buy (even more) AGG, HYLB, PFFD, and USHY; and also establish a new holding in QQQ.

On September 8th, my stop-loss triggered for NVDA.

On September 11th, my stop-loss triggered for AAPL and AMD.

It is difficult to overstate how important these particular stocks have been for my portfolio.

Tesla - due to both the size of the investment, and its extraordinary performance - had an especially large importance.  The gains from TSLA alone exceeded the value of my entire portfolio through the first 19 years of my investing career.

The result of these sales is a lot of cash...now my largest holding.  I plan to use the proceeds primarily towards QQQ, AGG, HYLB, PFFD, and USHY over the upcoming months.

As if that wasn't enough, the super-secret high-conviction stock in my Roth IRA was also sold on September 3rd via stop-loss trigger.  The proceeds from this sale re-established a 50/50 split between AGG and two new high-conviction stocks.  I will soon update my Grand Unified Theory accordingly.

Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 66/34.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five Two every month, whether I buy them or not.

Amazon (AMZN)

• $1.58T market cap
• no dividend
• $321.8B revenue
• 40% revenue growth
• $71.4B cash
• $91.4B debt
• $51.2B operating cash flow
• $33.7B free cash flow

Microsoft (MSFT)

• $1.58T market cap
• 1.0% dividend yield
• $143.0B revenue
• 13% revenue growth
• $136.5B cash
• $82.1B debt
• $60.7B operating cash flow
• $34.3B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Amazon (AMZN) 11.90%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 9.55%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 9.53%
iShares Core U.S. Aggregate Bond ETF (AGG) 9.53%
Microsoft (MSFT) 8.87%
Global X U.S. Preferred ETF (PFFD) 4.94%
Invesco QQQ Trust (QQQ) 3.27%
Alphabet (GOOGL) 3.20%
Facebook (FB) 2.49%
Intuitive Surgical (ISRG) 2.07%
Adobe (ADBE) 1.92%
Salesforce (CRM) 1.59%
Visa (V) 1.14%
Costco Wholesale (COST) 1.13%
UnitedHealth Group (UNH) 1.06%
Autodesk (ADSK) 0.57%

(Preferred) Stock(/Bond ETF)s Of The Month: AGG, HYLB, PFFD, USHY

First...a triggered sale! During its most recent earnings call, Intel (INTC) announced that they are considering exiting the chip manufacturing business, as they are experiencing delays with their 7nm process. Self-announcing that they are now a second-rate chip manufacturer, paired with their existing rank of third-rate chip designer, was not well received by the market. Intel had already been flirting with my stop-loss trigger order for a while; with this news, the stock price cratered right through it.

A holding since 2010, INTC gained a dollar-cost-averaged 54% (4% annualized). I hope that Intel will return to its status as a great American innovator - in the meantime, current holdings AMD and NVDA will stand to benefit from Intel's miscues, particularly in desktops/laptops and the cloud. The proceeds from this sale went mostly to PFFD, and the rest to AGG, HYLB, and USHY.


Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 95/5 - and even if tomorrow all of my stop-loss trigger orders were executed, it would be just 78/22.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five every month, whether I buy them or not.

Amazon (AMZN)

• $1.60T market cap
• no dividend
• $321.8B revenue
• 40% revenue growth
• $71.4B cash
• $91.4B debt
• $51.2B operating cash flow
• $33.7B free cash flow

Apple (AAPL)

• $1.87T market cap
• 0.8% dividend yield
• $273.9B revenue
• 11% revenue growth
• $93.0B cash
• $122.2B debt
• $80.0B operating cash flow
• $52.3B free cash flow

Microsoft (MSFT)

• $1.64T market cap
• 1.0% dividend yield
• $143.0B revenue
• 13% revenue growth
• $136.5B cash
• $82.1B debt
• $60.7B operating cash flow
• $34.3B free cash flow

NVIDIA (NVDA)

• $270.9B market cap
• 0.2% dividend yield
• $11.8B revenue
• 39% revenue growth
• $16.4B cash
• $7.6B debt
• $5.0B operating cash flow
• $3.2B free cash flow

Tesla (TSLA)

• $276.7B market cap
• no dividend
• $25.7B revenue
• -5% revenue growth
• $8.6B cash
• $15.5B debt
• $2.7B operating cash flow
• $1.1B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks/ETFs - until I sell them.

Tesla (TSLA) 26.66%
NVIDIA (NVDA) 16.29%
Amazon (AMZN) 13.13%
Apple (AAPL) 11.81%
Microsoft (MSFT) 10.30%
Alphabet (GOOGL) 3.46%
Facebook (FB) 2.58%
Intuitive Surgical (ISRG) 2.23%
Adobe (ADBE) 1.93%
Salesforce (CRM) 1.44%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 1.27%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 1.27%
iShares Core U.S. Aggregate Bond ETF (AGG) 1.22%
Costco Wholesale (COST) 1.21%
Visa (V) 1.18%
UnitedHealth Group (UNH) 1.17%
Global X U.S. Preferred ETF (PFFD) 1.13%
Advanced Micro Devices (AMD) 1.09%
Autodesk (ADSK) 0.64%

(Preferred) Stock (ETF) Of The Month: PFFD

After reading this article, I decided that I needed to add a preferred stock ETF to my portfolio. Global X U.S. Preferred ETF (PFFD) is the only one that I could find with an expense ratio (a still-not-insignificant 0.23%) that I can stomach.


Boilerplate time...

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 96/4 - and even if tomorrow all of my stop-loss trigger orders were executed, it would be just 78/22.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond and/or preferred stock ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I want to track my Big Five every month, whether I buy them or not.

Amazon (AMZN)

• $1.54T market cap
• no dividend
• $296.3B revenue
• 26% revenue growth
• $49.3B cash
• $78.2B debt
• $39.7B operating cash flow
• $26.7B free cash flow

Apple (AAPL)

• $1.65T market cap
• 0.9% dividend yield
• $268.0B revenue
• 1% revenue growth
• $94.1B cash
• $118.8B debt
• $75.4B operating cash flow
• $45.0B free cash flow

Microsoft (MSFT)

• $1.61T market cap
• 1.0% dividend yield
• $138.7B revenue
• 15% revenue growth
• $137.6B cash
• $84.0B debt
• $58.1B operating cash flow
• $36.2B free cash flow

NVIDIA (NVDA)

• $251.3B market cap
• 0.2% dividend yield
• $11.8B revenue
• 39% revenue growth
• $16.4B cash
• $7.6B debt
• $5.0B operating cash flow
• $3.2B free cash flow

Tesla (TSLA)

• $253.3B market cap
• no dividend
• $26.0B revenue
• 32% revenue growth
• $8.1B cash
• $15.2B debt
• $2.6B operating cash flow
• $1.6B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks - until I sell them.

Tesla (TSLA) 26.10%
NVIDIA (NVDA) 16.08%
Amazon (AMZN) 13.83%
Apple (AAPL) 11.00%
Microsoft (MSFT) 10.78%
Alphabet (GOOGL) 3.73%
Facebook (FB) 2.65%
Adobe (ADBE) 2.10%
Intuitive Surgical (ISRG) 2.00%
Salesforce (CRM) 1.51%
Visa (V) 1.29%
Costco Wholesale (COST) 1.24%
UnitedHealth Group (UNH) 1.23%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 1.19%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 1.18%
iShares Core U.S. Aggregate Bond ETF (AGG) 1.15%
Intel (INTC) 1.12%
Advanced Micro Devices (AMD) 0.80%
Autodesk (ADSK) 0.70%
Global X U.S. Preferred ETF (PFFD) 0.32%

Stock Of The Month: MSFT...And Also AGG, HYLB, USHY (The Those Aren't Stocks - Those Are Bond ETFs! Edition)

One additional sale was triggered by stop-loss after last month's mega-sale: Nike (NKE), which had been part of the portfolio since 2013 and added to four times thereafter, for an overall 87% gain (9% annualized).

The proceeds went to Microsoft (MSFT), as June is a dividend stock month and it is now almost the same in allocation to Apple (AAPL) as the 4th and 5th of my core holdings; and once again, equal amounts of my bond ETFs (AGG, HYLB, USHY).

As a stretch goal: for dividend income purposes, I'd like this portfolio to eventually be as much as a 50/50 split between stocks and bonds. As seen below, it is currently 96/4 - and even if tomorrow all of my stop-loss trigger orders were executed, it would be just 74/26.

I am in no rush to flip into bonds. I would rather let my winners run forever. However, if in any given month I see no stocks that present themselves as especially good buying opportunities, I have no reservations in simply adding to my bond ETFs. It is truly a month-to-month situation (as it has always been!).

For the foreseeable future, I not only want to track which of my Big Five I buy in a given month - I want to track those that I don't buy.

Amazon (AMZN)

• $1.23T market cap
• no dividend
• $296.3B revenue
• 26% revenue growth
• $49.3B cash
• $63.7B debt
• $39.7B operating cash flow
• $40.7B free cash flow

Apple (AAPL)

• $1.40T market cap
• 1.1% dividend yield
• $268.0B revenue
• 1% revenue growth
• $94.1B cash
• $109.5B debt
• $75.4B operating cash flow
• $45.7B free cash flow

Microsoft (MSFT)

• $1.39T market cap
• 1.1% dividend yield
• $138.7B revenue
• 15% revenue growth
• $137.6B cash
• $84.0B debt
• $58.1B operating cash flow
• $36.2B free cash flow

NVIDIA (NVDA)

• $216.6B market cap
• 0.2% dividend yield
• $10.9B revenue
• 41% revenue growth
• $10.9B cash
• $2.6B debt
• $4.8B operating cash flow
• $3.2B free cash flow

Tesla (TSLA)

• $166.5B market cap
• no dividend
• $26.0B revenue
• 32% revenue growth
• $8.1B cash
• $15.2B debt
• $2.6B operating cash flow
• $1.6B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks - until I sell them.

Tesla (TSLA) 21.00%
NVIDIA (NVDA) 16.97%
Amazon (AMZN) 13.58%
Apple (AAPL) 11.36%
Microsoft (MSFT) 11.33%
Alphabet (GOOGL) 4.36%
Facebook (FB) 3.09%
Intuitive Surgical (ISRG) 2.42%
Adobe (ADBE) 2.19%
Salesforce (CRM) 1.63%
Visa (V) 1.57%
UnitedHealth Group (UNH) 1.54%
Costco Wholesale (COST) 1.48%
iShares Broad USD High Yield Corporate Bond ETF (USHY) 1.45%
Intel (INTC) 1.45%
Xtrackers USD High Yield Corporate Bond ETF (HYLB) 1.44%
iShares Core U.S. Aggregate Bond ETF (AGG) 1.40%
Advanced Micro Devices (AMD) 0.98%
Autodesk (ADSK) 0.77%

Putting The Damage On: Sold AWK, CNI, KSU, NSC, SBUX, UNP, WM; Bought AGG, HYLB, USHY

It is a fine line between prudence and panic.

Having observed my portfolio peak on February 19th along with the rest of the market, then precipitously decline, then expediently rebound back to where it was...

Yesterday, the market crumbled in the final hour of trading. This is something, as a long-term investor, I probably should have ignored. But I did not...

I read some tweets, and recalled some books, from some trusted sources. I reconciled with my new-ish portfolio philosophy. Mostly, I thought about the days and weeks following February 19th - and the nagging feeling that I could have, and should have, done something.

I feel like the days and weeks to follow May 12th will offer a sort of a 'do-over' for the days and weeks following February 19th.

Earlier this month, I had identified six stocks that I wanted to sell. I had planned to do this over the second half of 2020, but now my prudence was telling me the time is now.

Here are the six stocks (plus one) that I have sold. They all feature anemic growth and undesirable amounts of debt:

American Water Works (AWK): $3.6B revenue, 4% revenue growth, $0.1B cash, $10.4B debt
Canadian National Railway (CNI): -6% revenue growth
Kansas City Southern (KSU): $2.9B revenue, 8% revenue growth, $0.1B cash, $3.3B debt
Norfolk Southern (NSC): $11.1B revenue, -8% revenue growth, $0.6B cash, $12.2B debt
Starbucks (SBUX): $26.7B revenue, -5% revenue growth, $2.6B cash, $22.9B debt
Union Pacific (UNP): $21.6B revenue, -3% revenue growth, $1.2B cash, $29.2B debt
Waste Management (WM): $15.5B revenue, 1% revenue growth, $3.1B cash, $13.5B debt

In their place, I have purchased the first bond holdings of this portfolio's twenty year existence: equal amounts of AGG, HYLB, and USHY. I also have established stop-loss trigger orders - some of which, as of this writing, are very close to firing - for each of the remaining non-Big Five stocks; upon execution, the proceeds will be reinvested into the same three bond ETFs.

The result of all these moves is to:

• Increase focus on my largest (i.e. core) holdings;
• Retain capital gains via automated decisioning; and
• Rebalance my portfolio in favor of lower-risk assets.

Stocks Of The Month: MSFT, NVDA

On January 2nd I posted my Plan for 2020 and Beyond in which I committed to "get[ting] each of Amazon, Apple, Microsoft, NVIDIA, and Tesla to reach 16% of my holdings."

The good news is that I've bumped each of those stocks to a goal of 17%.

The bad(?) news is that each of these 17% (or 16%) goals are not viable without selling the more insignificant of my holdings. I've been lamenting for years that my portfolio has too many stocks; additionally, I've recently determined that several of the lesser holdings have undesirable amounts of debt.

This month's casualty is CSX. It features negative revenue growth (-5.2%), earnings growth (-7.7%), and a cash-to-debt ratio of $2.5B to $17.2B. First bought in March 2017, I was able to realize a 20% gain (6% annualized).


For the foreseeable future, I not only want to track which of my Big Five I buy in a given month - I want to track those that I don't buy.

Amazon (AMZN)

• $1.14T market cap
• no dividend
• $296.3B revenue
• 26% revenue growth
• $49.3B cash
• $63.7B debt
• $39.7B operating cash flow
• $40.7B free cash flow

Apple (AAPL)

• $1.27T market cap
• 1.1% dividend yield
• $268.0B revenue
• 1% revenue growth
• $94.1B cash
• $109.5B debt
• $75.4B operating cash flow
• $45.7B free cash flow

Microsoft (MSFT)

• $1.32T market cap
• 1.1% dividend yield
• $138.7B revenue
• 15% revenue growth
• $137.6B cash
• $84.0B debt
• $58.1B operating cash flow
• $36.2B free cash flow

NVIDIA (NVDA)

• $173.1B market cap
• 0.2% dividend yield
• $10.9B revenue
• 41% revenue growth
• $10.9B cash
• $2.6B debt
• $4.8B operating cash flow
• $3.2B free cash flow

Tesla (TSLA)

• $129.3B market cap
• no dividend
• $26.0B revenue
• 32% revenue growth
• $8.1B cash
• $15.2B debt
• $2.6B operating cash flow
• $1.6B free cash flow

Here's my current portfolio (buy, hold, and sell). As always, I believe in all of these stocks - until I sell them.

Tesla (TSLA) 18.87%
NVIDIA (NVDA) 15.68%
Amazon (AMZN) 14.46%
Apple (AAPL) 11.75%
Microsoft (MSFT) 10.90%
Alphabet (GOOGL) 4.61%
Facebook (FB) 3.10%
Intuitive Surgical (ISRG) 2.42%
Adobe (ADBE) 2.22%
Costco Wholesale (COST) 1.67%
Salesforce (CRM) 1.66%
UnitedHealth Group (UNH) 1.65%
Visa (V) 1.63%
Intel (INTC) 1.55%
Nike (NKE) 1.52%
Starbucks (SBUX) 1.16%
Advanced Micro Devices (AMD) 1.05%
Waste Management (WM) 0.98%
American Water Works (AWK) 0.74%
Autodesk (ADSK) 0.71%
Union Pacific (UNP) 0.61%
Norfolk Southern (NSC) 0.57%
Kansas City Southern (KSU) 0.24%
Canadian National Railway (CNI) 0.24%

Stocks Of The Month: AMZN, TSLA

First - a sale! Comcast (CMCSA) has been an underperformer ever since I bought it over three years ago. Additionally, inspired by this article warning of the fragility of growth via leverage (among other things), I looked at all of my stocks' cash-to-debt levels...and Comcast was by far the worst, with $5.5B in cash and a whopping $112.0B in debt. It was sold at an 18% loss (-6% annualized). Going forward, I will add cash and debt levels to my monthly tracking stats.

For the foreseeable future, I not only want to track which of my Big Five I buy in a given month - I want to track those that I don't buy.


Amazon (AMZN)

• $970.6B market cap
• no dividend
• $280.5B revenue
• 21% revenue growth
• $55.0B cash
• $77.5B debt
• $38.5B operating cash flow
• $18.8B free cash flow

Apple (AAPL)

• $1.11T market cap
• 1.2% dividend yield
• $267.7B revenue
• 9% revenue growth
• $107.2B cash
• $116.8B debt
• $73.2B operating cash flow
• $45.6B free cash flow

Microsoft (MSFT)

• $1.20T market cap
• 1.3% dividend yield
• $134.3B revenue
• 14% revenue growth
• $134.2B cash
• $87.2B debt
• $54.1B operating cash flow
• $35.1B free cash flow

NVIDIA (NVDA)

• $161.3B market cap
• 0.2% dividend yield
• $10.9B revenue
• 41% revenue growth
• $10.9B cash
• $2.6B debt
• $4.8B operating cash flow
• $3.2B free cash flow

Tesla (TSLA)

• $96.6B market cap
• no dividend
• $24.6B revenue
• 2% revenue growth
• $6.3B cash
• $14.7B debt
• $2.4B operating cash flow
• $1.5B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks - until I sell them.

NVIDIA (NVDA) 16.10%
Tesla (TSLA) 15.79%
Amazon (AMZN) 14.70%
Apple (AAPL) 11.93%
Microsoft (MSFT) 10.97%
Alphabet (GOOGL) 4.70%
Facebook (FB) 2.98%
Intuitive Surgical (ISRG) 2.70%
Adobe (ADBE) 2.37%
Costco Wholesale (COST) 1.93%
Salesforce (CRM) 1.74%
Visa (V) 1.73%
Nike (NKE) 1.71%
Intel (INTC) 1.70%
UnitedHealth Group (UNH) 1.67%
Starbucks (SBUX) 1.20%
Advanced Micro Devices (AMD) 1.12%
Waste Management (WM) 1.07%
American Water Works (AWK) 0.85%
Autodesk (ADSK) 0.68%
Union Pacific (UNP) 0.65%
Norfolk Southern (NSC) 0.57%
CSX (CSX) 0.56%
Kansas City Southern (KSU) 0.28%
Canadian National Railway (CNI) 0.27%

Stock Of The Month: MSFT

For the foreseeable future, I not only want to track which of my Big Five I buy in a given month - I want to track those that I don't buy.

Amazon (AMZN)

• $937.8B market cap
• no dividend
• $280.5B revenue
• 21% revenue growth
• $38.5B operating cash flow
• $18.8B free cash flow

Apple (AAPL)

• $1.20T market cap
• 1.1% dividend yield
• $267.7B revenue
• 9% revenue growth
• $73.2B operating cash flow
• $45.6B free cash flow

Microsoft (MSFT)

• $1.20T market cap
• 1.3% dividend yield
• $134.3B revenue
• 14% revenue growth
• $54.1B operating cash flow
• $35.1B free cash flow

NVIDIA (NVDA)

• $154.6B market cap
• 0.3% dividend yield
• $10.9B revenue
• 41% revenue growth
• $4.8B operating cash flow
• $3.2B free cash flow

Tesla (TSLA)

• $125.2B market cap
• no dividend
• $24.6B revenue
• 2% revenue growth
• $2.4B operating cash flow
• $1.5B free cash flow

Here's my current portfolio (buy and hold). As always, I believe in all of these stocks - until I sell them.

Tesla (TSLA) 18.96%
NVIDIA (NVDA) 15.06%
Apple (AAPL) 12.17%
Amazon (AMZN) 11.60%
Microsoft (MSFT) 10.26%
Alphabet (GOOGL) 4.86%
Facebook (FB) 3.02%
Intuitive Surgical (ISRG) 2.71%
Adobe (ADBE) 2.33%
Salesforce (CRM) 1.88%
Visa (V) 1.79%
Costco Wholesale (COST) 1.71%
Nike (NKE) 1.65%
UnitedHealth Group (UNH) 1.58%
Intel (INTC) 1.57%
Comcast (CMCSA) 1.40%
Starbucks (SBUX) 1.30%
Waste Management (WM) 1.17%
Advanced Micro Devices (AMD) 1.00%
American Water Works (AWK) 0.81%
Autodesk (ADSK) 0.77%
Union Pacific (UNP) 0.63%
Norfolk Southern (NSC) 0.62%
CSX (CSX) 0.59%
Kansas City Southern (KSU) 0.29%
Canadian National Railway (CNI) 0.26%