Put in $2500, then purchased:
$500 for APO
$500 for BN
$500 for PAX
$673.87 for NVDA
$500 for TSM
I planned to stop putting in more cash last week, but today's big drop in the stock market attracted me to advance some cash from somewhere else to put in more. The 10% drop of the market since last week was due to Trump's tariffs and the retaliation from China caused the world to fear a serious global tariff war will cause a global recession.
My portfolio has retreated substantially since the last portfolio update, albeit still outperformed the market since inception.
The fear is somewhat legit, but I think the stocks in my portfolio were punished excessively. They were already well off the peak before this week. For example, APO was at $136.94 last Friday, which was 27% off its peak at $189 reached by the end of 2024, and 15% off of its stock price after 2024 Q4 earnings in February. Then it saw a 20% cut this week since last Friday. Its insurance business is sticky and its asset management business is sticky to some degree as well. Growth can be impacted, but should have less impact than the overall S&P index.
I also sold a few stocks.
I sold MCHI due to the uncertainty geopolitical tension between the US and China. I had paused the purchase of the ETF a while, so I am just pulling the plug now. I lost about 31.2% in 3 years excluding dividends. It was about 2.7% of my portfolio.
I put all $3623.07 sale proceeds into APO.
I sold CKHUY due to the unjust influence of the China government over the company. Its port deal was blocked by the government due to politics. The government also utilized the media to criticize the Li family. It will not do well for the company no matter how the ports deal ends up. I earned about 3.28% in 17 months on average excluding dividends (about 10% return with dividends). It was about 8.7% of my portfolio. For the sale proceeds:
Put $5000 in TSM
Put $7217.18 in APO
Finally, I sold GLDM. I decided not to hold gold long-term. Considering advancement in mining in space, gold may not be as rare as it seems, so its store of value is a bit uncertain.I earned 4.2% for holding about one month on average. It was about 0.6% of my portfolio.
I put all $938 sale proceeds into APO.
Most of the sale proceeds went into APO because it is such a good deal at the current price. It's trading at less than 13 P/E that has earnings growing 15+% annually with a bit over 1% dividend yield:
For TSM, 2025 expected EPS is $9.05, so it's trading at $147/9.05 = 16 P/E for pretty much the most important AI chip company in the world, which is growing 20% annually or so.
In this presentation of the portfolio update, I changed the "Individual holdings" section a bit because I found a snapshot page in Robinhood that gives more information for the holdings in one screen, including the average cost per share..
Transactions
Recent and upcoming dividend distributions
Portfolio
All-time return:
One-year return:
Portfolio IRR (calculation): 9.8%
Approximated IRR for an SPY-only portfolio: 5.55%
Individual holdings:
Breakdown by categories (real-time):
All-time returns for individual holdings:
Last prices:
Portfolio holdings conviction
The convictions in the table below reflects my current opinions and will guide the future contribution of additional investment to existing holdings. Stocks not inside the table are stocks with subpar return on equity that will be very unlikely to receive more contributions from new money (there can be exceptions for very cheap stocks).
Conviction in long-term prospects means how much I believe a company would match or outperform the market (e.g. S&P 500) in the long run. Valuation matters so the conviction generally corresponds to the neutral rating of Valuation. It has the following ratings: weak, moderate, strong
Valuation: overvalued, slightly overvalued, neutral, slightly undervalued, undervalued, greatly undervalued
Brief comments on individual holdings
ADC
Agree Realty is one of the lowest leverage triple-net lease REITs with a debt to EBITDA ratio of 4.9x. Its tenants are mostly investment grade (67%) retailers and restaurants. At the worst time of 2021, it collected 95% of the rents, which shows the quality of its assets.
One special thing about Agree Realty is its 14% portfolio in ground leases, which has low default risk, low cash flow, with short-term inflation risk, but long-term stable return. It diversifies the risk portfolio of the company.
Its acquisition and disposition ratio is 4.2% in 2021. The ratio is kept low for the past, which again, shows the quality of the assets, so that it does not have to sell many non-performing assets.
XYZ
Brief analysis and latest updates here
PYPL
Analysts expect Paypal 2023 EPS to be $4.94, and will grow more 15-20% annually for a few years. Its top line will grow at a high single digit as well. 2023 P/E ~ 13 is quite attractive. Paypal's economic moat did not change recently. Its neutral position in payments is a good counterposition for big competitors like Apple Pay, Google Pay, Visa, Mastercard, Zelle, etc. It's OS and payment network neutral. As a case in point, Paypal was accepted as a payment on Amazon.
Short-term catalysts are continuous growth of users in Venmo, shopping super app, and the cost cutting measure to make the company more efficient. The stock price is depressed now only because the market worries about its short-term growth.
META
Global Monthly Active User (MAU) above 2.8 billion. Facebook is the biggest social network in the world. There will always be people buying Facebook/Whatsapp/Instagram.
The economic moat is weakened by Tiktok, but Tiktok is not really a social network that connects users who are familiar with each other, but another variant of youtube, so Facebook is still the top dog in social networking, although user time spent is definitely hurt.
Given Facebook's investment in VR; optional values in Facebook dating, and Facebook shops; Facebook Pay and Messenger have good monetization potential; Instagram has a unique position for people to express themselves; the improvement in Ads Infra to compensate for the loss in Apple App Tracking Transparency, I believe Facebook will come back. Long term annual growth of 15-20% in earnings should not be a problem.
BRK.B
Berkshire Hathaway in the current form was found by my idols, Warren Buffett and Charlie Munger. I will try to buy more if it's not very expensive.
AMZN
Brief analysis and latest updates here
OWL
Blue Owl Capital is an alternative asset management company, similar to Blackstone. Its focus is on direct originations of loans to private-equity backed and non-sponsored companies (middle-market and upper-middle-market companies). It has a net leases real estate platform. It also provides long-term minority equity and financing to private capital investment managers. A majority of the company's assets are funded by permanent capital, so it does not have withdrawal risk. Most of its earnings come from recurring fees from asset management without performance consideration, so the earnings stream is quite stable. Given it acquired STORE Capital (STOR) recently at a decent price, the management is very good.
Equity compensation related expenses were about 35% of DE that got added back into GAAP when getting DE. Its "true" EPS is about $0.1 per quarter, or about $0.4 in 2023. The P/E is about 30, not cheap, but not very expensive considering its growth is 15-20% annually. Another way to look at it is that its dividend yield is about 4.5%, and it's growing in double digits for at least 3+ years, which makes it quite attractive.
APO
Apollo specialized in distress situations, which reduced the number of competitors. Its famous slogan is purchase price matters, which shows how price conscious they are in picking investment. It has another slogan "we want 25% of everything and 100% of nothing on the asset", which is a goal post of the company about engaging in a lot of asset managing transactions even for other asset managers. It's a good way to position the company to have a large adjustable market. Their use of reinsurance company, Athene, helps them to grow assets under management effortlessly as well.
[2025/04/04] Expected 2025 EPS is $8.3, so P/E around 13.25, pretty cheap with an expected growth of 10-15%. 1.68% dividend yield helps a bit as well.
BN
Brief analysis and latest updates here
BAM
The pure asset management company part of the Brookfield Corporation. With BN, BAM can grow its asset under management (AUM) easily. Oaktree Capital, founded by the famous Howard Marks, is part of it, so it's very reputable.
The management has already indicated they are locked in to grow its cash flow 15% annually for the next field years. Its management fees do not rely on performance that much, so they are stable. With an expected 2023 EPS of $1.39, P/E 25 is not cheap, but with the help of 3.8% dividend yield (close to 100% payout, thanks to the asset light business model), there is a fair chance the stock can return 15% annually.
BX
A very reputable company in real estate. Its management fees rely on performance much more than Brookfield, but Blackstone has a track record, so I am not too worried about it.
Expected 2023 EPS is $4.36, P/E ~ 21. A 3.5% dividend yield with expected annual growth of 10-15%, this stock can potentially get a 15+% return in the long run.
HASI
Brief analysis and latest updates here
AHH
Brief analysis and latest updates here
EPRT
Brief analysis and latest updates here
MAIN
Brief analysis and latest updates here
BABA
Brief analysis and latest updates here
PAX
Brief analysis and latest updates here
BNL
Brief analysis and latest updates here
BIDU
Brief analysis and latest updates here
NVDA
Brief analysis and latest updates here
TSM
Brief analysis and latest updates here
TSLA
Brief analysis and latest updates here
NNN
Brief analysis and latest updates here
BTC
Bitcoin Brief Investment Thesis (for BTC)
HOOD
Brief analysis and latest updates here
SPY, VWO
ETF Brief Descriptions and Updates
