5 Changes I Made to My Portfolio (Mid Year Review 2024) | Top 5 Changes I Made to My Portfolio

Summary

In this video, the speaker discusses strategic stock transactions in their portfolio, focusing on buying more of NRG due to its significant growth and high billionaire interest in energy stocks. They sold Caterpillar, replacing it with KKR for diversification, and swapped Ulta for Deck due to Ulta's underperformance and Deck's promising outlook. The speaker also shares lessons learned from value investing and the importance of following personal investment processes. Other stocks like Marriott and Palo Alto Networks were sold to consolidate the portfolio and reallocate funds to better-performing stocks, emphasizing the need for portfolio management and strategic decision-making.

Takeaways

• 📈 The speaker has made changes to their stock portfolio, buying and selling stocks based on market performance and personal strategy.
• 🛒 They purchased more shares of NRG, a stock that has seen significant growth over the past 6 months and year, with interest in doing more covered calls with the company.
• 🚜 Sold Caterpillar, which had good performance but was replaced with KKR, an asset manager, as part of a diversification strategy and due to long-standing interest in KKR.
• 👟 Bought Deckers Outdoors, known as Deck, replacing Ulta which did not perform well, reflecting a shift from a value investment that didn't pan out to a growing company.
• 💄 Expressed dissatisfaction with Ulta's performance, citing personal errors in selling timing and acknowledging a struggle with value investing strategies.
• 🔄 TransDigm (TDG) was acquired, replacing Marriott, as part of an effort to maximize gains and maintain a manageable portfolio size.
• 🏨 Sold Palo Alto Networks, taking profits due to perceived slowing growth, aiming to reallocate funds to other areas of the portfolio.
• 👧 Made changes in the speaker's daughter's portfolio, swapping Lululemon for Chipotle and Ulta for Netflix, based on recent market trends and personal preferences.
• 📊 Highlighted the importance of reviewing investment notes and being consistent with one's own investment process rather than trying to emulate others.
• 📈 Mentioned the recent stock splits of Chipotle and other companies, indicating a belief in the potential positive impact of such actions on stock performance.
• 📚 Offered to do a deep dive on the energy sector and why billionaires are investing in it, showing an openness to explore and share knowledge on specific market trends.

Q & A

What significant action did the speaker take regarding their stock portfolio?

The speaker bought and sold stocks in their portfolio, specifically adding more shares to NRG, selling Caterpillar and Ulta, and replacing them with KKR, Deck, and Netflix.

Why did the speaker decide to buy more shares of NRG?

The speaker decided to buy more shares of NRG because the stock has performed well, being up 52% in the last 6 months and 110% over the last year, and they want to do more covered calls with the company.

What was the speaker's reason for selling Caterpillar stock?

The speaker sold Caterpillar stock and replaced it with KKR because they have been interested in KKR for a while and believe it could perform better, despite Caterpillar's recent gains.

What mistake did the speaker acknowledge making with Ulta stock?

The speaker acknowledged being too patient with Ulta stock, holding onto it longer than they should have, expecting a recovery that never came, which resulted in a loss.

Why did the speaker choose to replace Ulta with Deck?

The speaker chose to replace Ulta with Deck because Deck has shown strong performance, being up 45% in the last 6 months and 84% over the last year, and they wanted to diversify their portfolio.

What was the speaker's strategy for managing the number of stocks in their portfolio?

The speaker's strategy is to keep the number of stocks between 10 to 12 to maintain manageability and ensure they can research and stay informed about each company.

Why did the speaker decide to sell Palo Alto Networks stock?

The speaker decided to sell Palo Alto Networks stock because they believe it is slowing down and they want to take their profits and invest in other companies that are performing well.

What was the speaker's reasoning for the stock split prediction of Chipotle?

The speaker had predicted the stock split of Chipotle based on their analysis and had mentioned it in a previous video, which turned out to be correct.

How did the speaker's daughter's portfolio changes reflect the speaker's investment philosophy?

The changes in the daughter's portfolio, such as selling Lululemon and Ulta and buying Chipotle and Netflix, reflect the speaker's philosophy of diversification and investing in companies that have shown recent strong performance.

What is the importance of reviewing investment notes according to the speaker?

Reviewing investment notes is important for the speaker as it helps them to reflect on their investment process, identify areas of strength and weakness, and make more informed decisions in the future.

What did the speaker learn about their investment style from the experience with Ulta?

The speaker learned that they are not particularly good at value investing, despite following the principles from books and doing their homework, and that they should stick to their own investment process.