One of the areas of investing I've become involved with over the past year and a half has been an AAII (American Association of Individual Investors) special interest group that meets very close by. Many of the AAII activities are much further away (1/2 hour to 1+ hours with traffic), so when they started a group in northern Delaware, I was on-board with that. Even better that the leader was Rajeev Vaidya who has been a long-time teacher of investment strategies whom I met about 25 years ago.
One of the aspects of the group is that we have a paper portfolio that we are using to purchase stocks that we feel are worth owning in a portfolio. Many of the members will bring stocks that they own or that they have researched recently that they may feel are worthy stocks. Our portfolio consists of an initial paper value of $100,000 in cash and based on our criteria of limiting our exposure in any one stock to 5% of the portfolio value, we tend to invest about $5,000 in paper money into each stock.
I have the role in the group as portfolio manager, so this means I'm keeping track of this paper portfolio and our trades in it. I'll be including that report on a monthly basis in this blog. I probably will also use the blog each month to add some commentary about our portfolio, similar to what we do when I do a live presentation to our group each month.
So with that background, here is the information for December of 2019:
The portfolio consists of a number of stocks that pay dividends. Over the past few months, our group has focused more on dividend-paying stocks because we feel that while the market is still in an uptrend, even if the stocks we pick don't move much, we are paid to wait via the dividend.
This month, three of our stocks paid dividends, which we just store in our cash portion and don't reinvest. In addition, we sold our position in Alaska Air (ALK). Initially when we bought it in May of this year we set (as we always do) a price goal as well as a stop-loss price that helps us reduce our losses to a set amount. ALK was able to meet and exceed our goal, so we raised our goal and sell-stop so that we could let this stock continue to rise, but if it changed direction we would hold onto our gains. So, when ALK dropped below our sell-stop price in early December, we sold the position for about a 10% gain (for holding it six months!).
We have another stock in our portfolio, Analog Devices (ADI) that has met our goal price (although that goal was not very aggressive) and so it will be time to revisit our sell-stop and goal prices for that stock as well. Our member Bruce "owns" that stock in that he provides updates for the stock as we hold it. In addition to giving updates for price goal/sell-stop, that may also include quarterly information on the company and company news that might affect the value of the company.
If you would like to see the portfolio update for December 2019, it can be found here.