Portfolio Performance In 2020
Seeking Alpha Analyst Since 2020
I am currently a Senior at The University of Mississippi pursuing a double major in Banking and Finance and Managerial Finance. My investment strategy is focused on long-term growth stocks within the eCommerce, Financial Technology and Consumer-Packaged Goods sectors.
- This blog post highlights my personal portfolio performance in 2020.
- My portfolio largely consists of technology and e-commerce equties.
- My returns were achieved solely by having long positions, I plan on beginning to trade options and shorting equities this new year.
When I fist began my brokerage account in March of 2020 I was primarily interested in learning about the market as a whole. I had a good understanding of the financial system but I had never traded a stock prior to this year. I chose to use SoFi invest when I started my account as I personally found the financial holding company offered a good mix of investing and banking incentives for qualifying accounts.
A majority of my holdings and trades this year were based on technology and e-commerce companies. As Cvoid-19 became a major concern for most Americans I like many investors saw the incoming shift to online purchases and sales. As a result I focused my account towards growth technology and e-commerce companies. The companies I primarily focused and invested in were Amazon, Tesla, Shopify, Etsy, Chewy, Microsoft and, PayPal.
Tesla was one of most profitable trades with an average return of 335.33%. I originally invested in Tesla as I liked how disruptive the car manufacturer is. I also saw it as a good way to possibly make profit from Elon Musk's company Space X. Although, Space X is not listed publicly on any exchange every time Space X completes a major accomplishment Tesla stock will also rise slightly. Little did I know the historic bull run Tesla would also go on for a majority of this year. Tesla's current market capitalization has grown tremendously and is currently larger than the other top nine auto-manufactures. This is a concern for many as investors are beginning to fear how long this bull run or bubble lasts for Tesla in 2021. I personally remain bullish on Tesla but I do expect some growth decline. This will be primarily because of their net margin per-unit decreasing about 5% and the fact that it would be very difficult to replicate the growth experienced in 2020.
PayPal is another one of highest return equities in my portfolio at 68%. I always had a fondness and interest in PayPal after the company inadvertently founded "The PayPal Mafia". This along with the company being the most used electronic transfer service in the U.S. make the company a solid investment for any investor. The company has been able to sustain it's place as one of the largest Financial Technology (Fin Tech) companies due to incredible innovations and acquisitions over the years. This is proven through PayPal letting third party developers directly access PayPal infrastructure and revolutionizing instant fraud detection within the Financial Technology space. These innovations along with PayPal's acquisition of Braintree (Venmo) in 2013 have put PayPal in a very advantageous place compared to other Fin Tech companies. Because of all of these various factors discussed I remain bullish on PayPal and believe the company is extremely innovative and agile to changes in market conditions through 2021.
**Most of my remaining trades through 2020 are listed below**
Company: Apple | Return: 20.78% | Position: Holding
Notes: Apple will continue to be a consumer staple in 2021 and should he held by any investor wanting technology exposure as the company is established and safe.
Company: Amazon | Return: 30.64% | Position: Holding
Notes: As the largest online retailer Amazon is a great company to hold onto. However, I would not recommend this being your largest position. I say this because at one point Amazon was my largest holding and was not producing the level I expected it to as compared to smaller growth companies I also held at the time.
Company: Chewy | Return: 35.68% | Position: Holding
Notes: I originally invested in Chewy after ordering several products for my pets from their online store. I thought that the service was a great idea and within the same price range as in store products but with much more ease. Because of this I have been holding Chewy since October and estimate that the company will continue to grow and be a highly successful company. This is one of my few holdings based on personal preference rather than technical analysis.
Company: Etsy | Return: 67.89% | Position: Holding
Notes: I expect Etsy to continue to experience high growth as hand crafted items purchased online are at an all time high. The company is also fairly innovative compared to other online marketplaces which will help them adapt to future market changes.
Company: Shopify | Return: 12.34% | Position: Holding
Notes: When I first purchased Shopify I took a rather large loss. It was one of my first trades in my brokerage account and I did not have much experience. I originally purchased shares in the company as I saw the stock was at an all time high and I did not want to miss out on the potential opportunity. After purchasing my shares the stock then went on a decline for many days. This led me to losing much of the money I invested in Shopify. In order to re-coup my losses I learned about the concept of averaging down and did this a few times. After averaging down twice I am happy to say my Shopify shares are now positive after due time.
Company: Cannabis ETF | Return: 17.25% | Position: Sold
Notes: As marijuana continues to be legalized throughout the country new potential markets are opening by the day. My strategy surrounding this Cannabis ETF was to purchase shares at large decline right before an upcoming state announced their vote on legalization. Often, my purchased shares were priced extremely low and any good news on state legalization would net around a 5% increase. I would then sell on the good news and repeat the same thing with more companies and other states. This was one of my first trades in my brokerage account and I greatly learned from it.
Company: Plug | Return: 367.85% | Position: Hold
Notes: I originally purchased Plug (Ticker: PLUG) after doing some due diligence on the internet. I saw many analysts and investors were saying Plug was poised for a large increase as hydrogen fuel becomes more desired. Hydrogen fuel will be a main fuel source for cars moving forward as it will become cheaper and more readily available compared to gas and electricity. Plug experienced over a 1,000% return in 2020 alone and I am glad I was able to get in rather early.
Company: Genius Brands | Return: 137.34% | Position: Sold
Genius Brands was one of the first penny stocks I traded in my brokerage account. The stock was being pumped by about every investor on the internet as the company signed a huge deal with Stan Lee's company Pow Entertainment. Genius Brands stock rose sharply after this news and it reached past $10 a share from its previous penny stock status. I was lucky enough to have an average cost of $2.56 per share and realized my first gain from the stock market. However, I did not sell at the ATH as penny stocks are extremely volatile and the stock soon dropped back to its penny stock status. I was able to make a decent profit but learned that to trade penny stocks you need to have a clear entry and exit point. It is also probably wise to have stop loss orders activated as well. I do not trade penny stocks as regularly as I used to but I believe it was a great learning base for trading overall.
Looking back on my brokerage account in 2020 I am fairly happy with what I have accomplished. I originally wanted to begin trading to learn more about the overall market and I have done that and more. I learned a great deal about the market and I also learned many new financial skills while trading for my account. I would regularly practice stock valuation throughout the week and see what was over and under valued. I would also regularly evaluate Price to Earning Ratio's as well as perform CAPM calculations. Using all of these strategies this year I was able to realize a 76.68% overall return on my portfolio. I am very pleased with my performance this year but I do hope to beat my record this new year. I hope to beat this record by beginning to trade options and shorting equities early this year. This new strategy will have much more risk but it could potentially have much more upside if I am able to use my technical analysis correctly.
My main goal with publishing these financial articles is to improve my equity evaluation and analysis. I also think it could be advantageous to look back on my past trades in writing and learn from my actions. I do believe in all my positions but please invest at your own risk.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.