Friday, July 29, 2016

Portfolio and Net Worth Update July 2016

The time has come for my monthly portfolio update. At the end of every month, I will update my portfolio and comment on any changes. I do that for accountability and also so you may glean some ideas on how I allocate my capital. You have the opportunity to learn from what I do well, so you can do the same, as well as what I do poorly, so you will not have to repeat my mistakes.


Starting this month, my portfolio takes a new look! It is now broken by account by account, which makes it easier for me to track. Take a look here. It is also updated in real time, instead of once a month as before.


My transactions in July are listed as follows:

StockActionCostPrice per shareImpact
GILDNew Buy$2,524.00$81.420.34%
AANAdd$2,508.00$22.590.34%
SNYNew Buy$2,200.00$41.220.30%
SRCLNew Buy$2,008.70$91.300.27%
RHHBYNew Buy$1,959.24$31.600.26%
AZONew Buy$1,589.08$794.540.21%
BENAdd$1,539.45$34.210.21%
NVSNew Buy$1,100.00$81.050.15%
POTAdd$992.43$15.480.13%
DISCANew Buy$990.00$24.810.13%
RLNew Buy$979.90$97.990.13%
GGGNew Buy$949.00$73.000.13%
RHINew Buy$937.56$36.060.13%
CVSNew Buy$930.00$93.000.13%
UHSNew Buy$896.00$128.000.12%
BIIBNew Buy$722.37$240.790.10%
NKEAdd$650.00$55.730.09%
VFCAdd$650.00$61.510.09%
DISNew Buy$600.00$97.550.08%
HFCNew Buy$517.00$23.500.07%
PIINew Buy$516.00$86.000.07%
AAPLNew Buy$500.00$94.640.07%
AXPNew Buy$500.00$59.540.07%
FOXNew Buy$500.00$27.020.07%
GPSAdd$500.00$20.880.07%
TGTAdd$500.00$69.890.07%
VIABAdd$500.00$40.740.07%
TIFAdd$496.00$62.000.07%
FOSLNew Buy$493.00$29.000.07%
WFCNew Buy$477.50$47.750.06%
CCFNNew Buy$474.00$39.500.06%
KSSAdd$400.00$37.490.05%
SONAdd$257.77$48.230.03%
BDXAdd$206.77$171.700.03%
AFLAdd$200.00$71.640.03%
BRKBAdd$200.00$142.380.03%
EMRAdd$200.00$53.850.03%
KOAdd$200.00$45.610.03%
XOMAdd$200.00$94.710.03%
VMIAdd$160.97$136.760.02%
HCNAdd$150.00$74.820.02%
MCDAdd$150.00$125.770.02%
NSCAdd$150.00$92.250.02%
WMTAdd$142.00$73.470.02%
YORWAdd$136.60$30.400.02%
PEPAdd$120.21$106.660.02%
BUDAdd$100.00$128.600.01%
MOCOAdd$100.00$14.680.01%
NNNAdd$100.00$51.730.01%
ULAdd$100.00$47.900.01%
MSFTAdd$93.68$53.320.01%
INTCAdd$71.33$31.880.01%
EXCAdd$68.00$36.410.01%
PPLAdd$25.52$37.750.00%
PNYAdd$14.15$56.830.00%
SJIAdd$12.04$31.790.00%
ISHReduce-$0.03-$0.510.00%
LGCYReduce-$0.33-$1.650.00%
SANReduce-$0.48-$4.250.00%
ZAHLYReduce-$0.59-$0.120.00%
CELReduce-$0.92-$7.020.00%
PDLIReduce-$1.26-$3.560.00%
VEAReduce-$1.38-$36.320.00%
DVReduce-$1.53-$22.170.00%
OGZPYReduce-$2.09-$4.290.00%
MPCReduce-$2.27-$37.830.00%
ELNKReduce-$2.44-$6.850.00%
CPLPReduce-$2.92-$3.850.00%
BKReduce-$3.27-$39.880.00%
HNNMYReduce-$3.29-$5.930.00%
MROReduce-$3.43-$13.140.00%
MVCReduce-$5.58-$8.050.00%
NTTReduce-$5.76-$46.830.00%
BVNReduce-$6.23-$12.530.00%
BFRReduce-$6.55-$20.280.00%
AGNCReduce-$6.80-$19.480.00%
CSXReduce-$7.53-$28.400.00%
ICEReduce-$8.71-$263.940.00%
TLKReduce-$9.31-$63.510.00%
NATReduce-$9.56-$12.780.00%
HPQReduce-$11.59-$14.090.00%
MDLZReduce-$12.65-$43.920.00%
MRKReduce-$14.06-$58.580.00%
AZNReduce-$14.33-$31.060.00%
CTLReduce-$14.50-$30.720.00%
DTEGYReduce-$15.75-$16.700.00%
IMBBYReduce-$16.13-$52.030.00%
HPEReduce-$16.71-$20.310.00%
LUKOYReduce-$18.64-$43.880.00%
DGSReduce-$21.05-$40.830.00%
TLSYYReduce-$21.37-$21.500.00%
CQPReduce-$25.33-$27.210.00%
RBCAAReduce-$28.28-$29.970.00%
VWOReduce-$30.04-$36.860.00%
WBAReduce-$35.12-$81.390.00%
CEOReduce-$37.18-$126.72-0.01%
CHLReduce-$39.61-$62.25-0.01%
TReduce-$39.64-$42.76-0.01%
ESLTReduce-$52.99-$96.82-0.01%
KHCReduce-$60.20-$85.63-0.01%
VIGReduce-$60.66-$84.96-0.01%
LLYReduce-$75.56-$83.40-0.01%
LMTReduce-$86.67-$254.16-0.01%
SBReduce-$91.17-$1.11-0.01%
JNJReduce-$111.92-$124.77-0.02%
EVEPReduce-$229.41-$2.50-0.03%
OPTISold Out-$329.99-$0.55-0.04%
CRCSold Out-$331.49-$13.26-0.04%
OIBRQSold Out-$340.99-$0.50-0.05%
TRONCSold Out-$366.07-$14.08-0.05%
APASold Out-$396.79-$56.47-0.05%
TSCDYReduce-$418.94-$6.65-0.06%
ESold Out-$426.65-$32.82-0.06%
CIGSold Out-$462.33-$2.51-0.06%
BPReduce-$488.79-$36.71-0.07%
HIMXReduce-$560.95-$8.60-0.08%
CACQSold Out-$575.99-$12.00-0.08%
NUSSold Out-$596.86-$49.03-0.08%
SWRAYSold Out-$620.56-$11.52-0.08%
GSHReduce-$638.81-$23.66-0.09%
PTRReduce-$653.75-$69.99-0.09%
SOUHYSold Out-$704.01-$7.16-0.09%
IAGSold Out-$748.98-$4.99-0.10%
FTDSold Out-$821.98-$27.40-0.11%
EZPWSold Out-$1,035.48-$9.50-0.14%
SCSold Out-$1,166.52-$11.11-0.16%
OJSCYSold Out-$1,235.38-$5.23-0.17%
MBTSold Out-$1,253.83-$8.83-0.17%
ERYShort-$1,444.79$14.45-0.19%
DOSold Out-$1,485.30-$24.99-0.20%
RYAMSold Out-$1,495.95-$14.00-0.20%
ERXShort-$1,580.67$31.61-0.21%
PKXSold Out-$1,626.73-$46.31-0.22%
RDSASold Out-$1,906.13-$55.77-0.26%
TOTSold Out-$1,985.71-$48.74-0.27%
PBRSold Out-$2,286.04-$8.01-0.31%
SKMSold Out-$2,322.05-$20.98-0.31%
CIGCSold Out-$2,512.46-$1.79-0.34%
EDZShort-$2,754.77$27.55-0.37%
FASShort-$2,806.76$28.07-0.38%
TZAShort-$3,169.75$31.70-0.43%
VALEReduce-$3,303.68-$5.13-0.45%
FAZShort-$3,441.54$34.42-0.46%
BBLSold Out-$4,371.85-$26.37-0.59%
Bought$34,258.274.62%
Sold-$53,942.14-7.27%
Net-$19,683.87-2.65%

Purchases
This month, I initiated 22 new positions, most of which are attractively priced stocks near 52-week low with low dividend payout. I had an annual bonus money to spend and also recently did a partial ACAT from TDA account into Merrill Edge and a partial ACAT from Merrill Edge to open a new brokerage account with Interactive Brokers (IB), to take advantage of low margin rates. 

I have not started buying on margin yet, as I try to burn through most of my excess cash first before going on margin, and hope that the stock market might have a correction before I go on margin. I intend to leverage between 1.2 to 1.5. Considering that the stock margin return is roughly 10% a year, even just a 1.2 leverage would boost return to 12%. The difference over 40 years is staggering. Assuming $100,000 initial investment, it would grow to $9,305,097 at 12%, but only $4,525,926 at 10% annual return. That's more than double! At the currently elevated market levels, starting at leverage 1.2-1.3 is probably prudent. 


Sales
I sold a lot of old stock that were low quality and no longer fit well with my investment strategy. Some of the other sales are for partial shares sold during the ACAT process. I also sold short some 3x leveraged inverse ETFs, to take advantage of the time decay with these ETFs. I only shorted a total of $15,198.28, out of a total account value of $108,088.30 at IB, so I can tolerate a great deal of fluctuations before these leverage inverse ETFs eventually go to zero.

Portfolio turnover was 7.27% in July. This will probably be a record high for some time.


Here is how my assets, liabilities, and net worth have changed over the past month:

Beginning balance
on 6/30/2016
+ Cash inflow
/(outflow)
+ $ P/L= Ending Balance
on 7/31/2016
% P/L
ASSETS
Current assets
Cash35,467.1639,291.690.0074,758.850.00%
Bonds13,276.020.00(21.57)13,254.45-0.16%
Stocks493,373.43(19,683.87)25,699.18499,388.745.21%
Total current assets542,116.6119,607.8225,677.61587,402.044.74%
Tax-deferred retirement account125,267.211,649.073,943.36130,859.643.15%
Roth IRA63,120.840.001,528.3864,649.222.42%
Gold14,199.170.00353.6914,552.852.49%
Other non-current assets5,000.000.000.005,000.000.00%
Total assets749,703.8321,256.8931,503.04802,463.754.20%
LIABILITIES & EQUITY
Liabilities
Current liabilities108.24(108.24)0.000.00
Long-term debt
Student loan7,862.62(137.71)0.007,724.91
Margin loan0.000.000.000.00
Total liabilities7,970.86(245.95)0.007,724.91
Equity (net worth)741,732.9721,502.8431,503.04794,738.844.25%

My personal rate of return was 4.25% in July.

My monthly performance against the S & P 500 is shown below:
2016My Portfolio ReturnS & P 500 TR
Jan-3.69%-4.96%
Feb5.74%-0.12%
Mar3.99%6.79%
Apr1.39%0.39%
May0.21%1.80%
Jun3.41%0.26%
Jul4.25%3.52%
YTD16.00%7.52%

4 comments:

Investment Hunting said...

Wow, you were busy this month. I like your buys though. Buy high yielding stocks and cash checks ;-)

JTF said...

Thanks for commenting! I sold a lot of low quality stocks this month to prune my portfolio, which I have neglected to do for a while. I still have 74k of cash to dispose of, so I'll probably keep busy buying stocks in the upcoming month, too. Right now, I'm focussing more on high quality stocks with relatively low dividend payout, to reduce my tax liabilities while I'm still working, probably for at least another 6 years.

Passive Income Dude said...

Twenty Two new positions in one month is a lot!! Why so many? :)

JTF said...

You're right. It's probably too many. I tend to initiate new positions at $500 to $100, and happened to have a lot of uninvested cash this month due to a $12k annual bonus and $53k from sales of low quality stocks.

Plowing $6000 each into 5 high conviction stocks would have done the trick. Problem is I have been wrong before so I'm a bit apprehensive about putting $6000 all at once into a stock that could go down in flames, especially at the currently elevated stock market levels.

Another reason is that Merrill Edge and loyal3 don't charge commissions for these trades I made. I like zero commission, but it is also kind of a bad incentive for more frequent trading:) I certainly would have made far fewer trades if I had to pay commission for them.