Please note that our next update can be expected in
about 12 weeks, in May 2017.
You can also have a look at our
actual portfolio and previous portfolio updates here:
Despite everyone’s
fears after the US
Will it last? Our
typical answer prevails: nobody knows!
Markets still look
expensive as they continue to hover close to record highs. In the latter part
of January, we could sense markets were getting nervous about the first moves
of the Trump administration. In fact, turbulences began around inauguration
day.
Investors initially
seem pleased about Trump’s probable economic policies. But markets don’t like
uncertainty and President Trump sure brings his fair share to the table.
So, it appears we could
be in for some wild ride.
What are we going to do with our DIY
Portfolio from now on?
Once more, I’ll remind you that I
am not an investment or tax professional of any kind. The intent of this blog
is not to give specific investing advice. Before investing yourself, we suggest
you to do all necessary research and consult a licensed financial professional
if need be.
Entering Consolidation Phase after Milestone
The short answer is
that it will simply remain business as
usual.
As we discussed in our
last update, we will continue to avoid buying and selling in anticipation and Only
React to Important Events Using Known Facts. As far as investing is
concerned, there’s no use trying to predict the future. And this is especially
true about foreseeing Trump’s influence. We can only choose to invest in solid
companies and remain optimistic about their long-haul perspectives.
Up to now, we are very pleased with the performance of our DIY Portfolio and are still very confident about getting similar long-term results in the future.
Up to now, we are very pleased with the performance of our DIY Portfolio and are still very confident about getting similar long-term results in the future.
We’ve also noticed that
it took a lot less time to amass our second 100K$ as the first one accumulated
over about 10 years (from 2003 to 2013) and the second one within a bit more
than 3 years (from 2013 to 2016). This can be explained because we were able to
put in more capital but also because our investing technique as greatly
improved.
We hope the next major
step, 300K$, will come to us as easily.
As we already mentioned
before, our DIY Portfolio
has now entered a consolidation phase. In line with our 12-Minute Approach, we are content to limiting its
scope to 3 sets of about 12 stocks each: our Canadian Prime 12, US Prime 12 and Extra 12 groups.
On top of providing us
with sufficient diversification, that limited number of different stocks allows
us to monitor and manage our DIY Portfolio with
minimal time and effort.
To some extent, you could say our DIY Portfolio is now on cruise control. A few new candidates will still be used but only to replace less adequate old ones.
To some extent, you could say our DIY Portfolio is now on cruise control. A few new candidates will still be used but only to replace less adequate old ones.
Staying Prudent with Recent Buys
As stated above, valuations
of many stocks appear rather expensive as market levels are continuously
flirting with record highs. Our Portfolio Variations numbers pretty much tell
the same story. Our Dip Factor averages
are almost at all-time lows. In our last two updates, we explained Why
we were holding on to more cash.
With all that in mind
and because new money continues to pour in our DIY
Portfolio, we decided to start acquiring stocks again but our initial selections
still have been relatively careful and somewhat conservative.
In fact, in line with
our recent consolidation mode, we only purchased additional shares to consolidate
existing positions.
Consequently, here are
our choices this time around.
Metro (MRU) Down 15.96% Dip Factor 3.45
Mostly known for its supermarket
chain, Metro is a well-diversified giant established in the food and pharmaceutical
distribution sector.
Metro is a fairly
conservative stock that is stress-free to own. It has delivered solid results
and steady growth over the years. Its stock value keeps going upward, slowly
but surely. Occasional temporary dips also makes it a stock relatively easy to
acquire at attractive prices.
Metro probably won’t
get you spectacular short-term results but bad surprises won’t come from that
steady performer either.
We first purchased
Metro in 2013 and added to that original position a couple times since.
Frankly, we wonder why we didn’t buy in that rock solid corporation earlier.
Fairfax (FFH) Down 20.91% Dip Factor 4.09
Fairfax Financial
Holdings Ltd is mainly engaged in the casual insurance sector.
The mastermind behind
Fairfax success, CEO Prem Watsa kind of goes against the grain. Because of his incredible
instinct and business sense, Fairfax usually performs better than most stocks
in difficult markets conditions.
With a Dip Factor over
4, we felt Fairfax represented an interesting opportunity and decided to
increase our previous stake in it.
That’s it from us for
this update. Come back again for another one in a couple months…
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