March 2019 - So far so good
Three months passed since I executed the last rebalancing exercise on my portfolio. The original positions I took in some stocks started to diverge quite strongly from what I intended, as a result of strong fluctuations in the markets.
Definitely the strongest winners were $CRON, $ACB and $CYBR, which I respectively (partially) closed at a profit of 72%, 54% and 45% in three months time! Interesting to see how much profit my portfolio made overall, thanks to some very strong performers in the cannabis industry. I do still think cannabis is in an upward trend, and will continue to grow. However, to not over-expose my portfolio towards one sector, I have partially closed my positions in $CRON and $ACB. Together with $CARA, the cannabis industry now represents approximately 11,5% of my portfolio value. Those cannabis stocks are particularly interesting because of their very low Beta. So although those stocks are very volatile on their own, they lower the overall risk of my portfolio because of their low correlation towards other sectors. Hence, I’m happy to announce that my risk score finally lowered from 5 (high) towards a (medium) 4. This is something I have been aiming to achieve since the last rebalancing.
I have also decided to close some underperforming stocks with a loss, such as $DIS, $SEDG, $TSLA and $WUBA. And however I still believe in those stocks for the long run, I do believe (and this is backed by the mathematical model I ran) that we will be better off by investing in better performing stocks. I have used those funds that got free by closing those positions, to strengthen my positions particularly in the payment services and sustainability solutions. Both have been performing quite well recently, and are a welcome diversification to my portfolio. Stocks include $WP, $V, $FLT and $MA for the payment services, and $A2A.MC, $AES, $ANA.MC, $GAM, $NEE, $ASH and $DAR, representing a wide variety of sectors all contributing to sustainable solutions.
I still believe that we are nearing the end of an economic cycle. Economic and financial indicators look fragile, and the socio-political context is quite turbulent. And although the tech sector is usually not very attractive at that point in time, I have chosen to still invest in a couple of tech stocks, albeit in very little amounts compared to the overall portfolio. I have been particularly interested by stocks in the cyber security services like $CHKP and $CYBR, because I think this is a sector that will grow in importance as we continue to expand our internet-based connectivity on a global scale.
Where 2018 ended up in losses, 2019 took a great start in January and February, already resulting in a 20% up so far. Let's hope on evenly strong results for the remainder of the year.
As always, if you have questions, don’t hesitate to shoot them at me. I’d be more than happy to help you around. I also kindly invite you, and potential new copiers to read more about investing and my strategy on my personal web site www.investmenttales.com.