Investing Update
What I'm buying, selling & watching
We’ve seen a lot of volatility come to the surface recently. Airlines, casinos and cruise line stocks are all back nearing their levels prior to the reopening. Most of these stocks gains have gone away. The bottom has also fallen out of energy related stocks.
As the rotation out of the COVID stay at home winners into the reopening plays gained the headlines, the past few months those trends have now changed. You would see a bounce back and forth from the high level growth into the more value and cyclical stocks. That was going on under the surface and keeping the overall market up.
What I’ve noticed of late is that rotation has stopped. Outside of the large cap safe tech stocks, most of the stocks in the S&P 500 are seeing a pullback. Many stocks are in correction territory. That includes the stay at home COVID winners, the reopening stocks, high multiple growth stocks, SPACs and value centered stocks.
Apple (AAPL), Microsoft (MSFT), Google (GOOGL), Nvidia (NVDA) and Facebook (FB) have really been allowing the overall market to stay at the current highs due to their large share of the indexes and overall market weighting. This is another reason to make sure you always diversified and have money in the overall market through low cost S&P 500 index funds.
This week two well known strategists, Liz Ann Sonders and Jonathan Krinsky who I follow closely came on CNBC and both had very similar sentiments on the market. Clips of each of their appearance are below.
The AAII Investor Sentiment Survey from this week shows it at its lowest level since October 2020. This indicates that individual investors have become slightly more bearish than bullish.
If you have significant gains in certain stocks this is a good time to take some off the table and lock in some gains. I’ve started to nibble at some stocks as you’ll see below but am prepared for more of a sell off if it happens. My shopping list is updated and ready if some stocks fall to certain levels.
Think of stock selloffs as things being on sale. When retailers announce upcoming sales, consumers get excited. Think of buying stocks the same way. They just don’t advertise the sales ahead of time. Always be ready!
Moves I’ve Made
Square (SQ) Added to my position. I’ve been consistently growing my position in Square. This is one of my favorite long term stocks and rising to be one of my largest overall holdings.
Crowdstrike (CRWD) Another of my favorite long term stocks. When there are any pullbacks this is one of the stocks that I add to. The sector of cyber security is just beginning and I feel this is the leader. 61 of the Fortune 100 are clients.
Uber (UBER) In the midst of a bad stretch I decided to add to my Uber position. Of all my stocks this is the one I’m starting to really dig into to see where this fits long term. I loaded up on this stock at the onset of the pandemic and have seen a very good return but this is a stock with a lot of challenges at the moment.
General Motors (GM) My position in GM was sold as it hit a stop loss I had in. When I start new position in a stock, I limit my downside after I buy it. I will only risk losing so much before the position automatically sells. So I cut my losses. GM has fallen sharply. The chip shortage looks to be an issue that is going to be longer than I was expecting. Going to let this stock come in a bit and settle down before I get back in.
What I’m Watching
Shopify (SHOP) This stock is at the top of my shopping list and the stock I’ve done the most research on of late. It’s the one stock that I kick myself for not buying as I’ve looked at buying it many times since early 2020. All it does is continue to climb higher. It’s come down a bit of late so I’m trying to establish where I want to initiate a position.
Disclaimer: This is not investment advice. You should not treat any opinion expressed as a specific inducement to make a particular purchase, investment or follow a particular strategy, but only as an expression of an opinion.