2020 is over. But the unforgiving and thoughtless market has not paused to let investors reflect. I will briefly attempt to do that here. But first…
**Insert platitudes about 2020 being an unprecedented year here**
Now, the results for the calendar year 2020.
Asset Allocation — 2020 to 2021
Over the last 12 months, the portfolio has moved from significantly overweight cash to something approaching balance. It should be noted; there were some personal dynamics that contributed to the allocation being so heavily weighted to cash.
2020 Performance
The infographic below summarizes the individual stock holdings for the calendar year 2020.
And the best 2020 performers1in the portfolio were…
And the worst 2020 performers were…
- Chevron
- ConEd
- GoodRX
- Alibaba
- Duke Energy
Each of the above are in the range of single digit loss to single digit gain.2
2021 Playbook
A playbook needs to be flexible enough to work across a spectrum of scenarios, yet rigid enough to provide a path for decision making. Here is what I am thinking as of now:
- Initiate monthly index fund and/or ETF purchases in individual brokerage (i.e., a non tax advantaged) account
- Sell individual companies purchased in 2020 if the investment was based more on prior depressed stock price (e.g., in March/April 2020) and less about the company’s longer-term future
- Initiative new positions from the 2021 Conviction Buy list3
- Preserve semi-significant cash position to be used for new individual stock ideas and/or during a significant drawdown in asset prices