Alberto Sigismondi's avatar

follower assets

SW Product Manager in SF Bay Area.
Investing since 2009
Remember we are not a fund. They have to show the best results to their clients on a quarterly basis, usually compared with the indexes. So they had to sell Tech and Semis and Discretionary to avoid their ratings to drop massively.

I am a firm believer this is a once in a decade opportunity to buy good quality businesses. So am I adding every 3 weeks to them.

If you don’t feel confident, probably you need a good emergency fund to sustain 1y of your expenses. That’s what I do.
3 of my smaller holdings reported recently. Some quick thoughts

  • $SOFI Happy with their results. I will add to to lower my cost basis
  • $GDRX Meh.. concerned with concentration surprises. Have to think it through, maybe the money is better off somewhere else...
  • $LMND Happy with their results. I will add to it to lower my cost basis
Growth Portfolio - April 2022
April 2022 performance: -24% (Worst month since March 2020)

Top holdings by weight:
$TSLA 15%
$NET 7%
$U 4%
$SQ 4%
Rest of holdings ~ 30%

  • I own a very small position in $PTON. Down significantly by 60%, decided that it doesn't make sense for me to sell. Will see what happens with the new CEO (good reputation) and potential new direction. If I see interesting things, I may keep building. If I still see bad management actions, I may end up selling.
  • $TDOC I own a full position and down also 56%. I am not selling, it doesn't make sense at this point. Once again, another case of management not at the required level. Management and boards can be changed and corrected. Will hold and see what happens in the following quarters.
  • Added new money from paychecks to almost all of my top holdings to keep my cost basis weight.
  • Not trimming $TSLA (probably the only holding I would not trim over 15%)
Hi Alberto

Really appreciate the transparency here. I think keeping a close eye on management and the direction they take is the best course of action at this point for $PTON. What are your thoughts on CEO Barry McCarthy’s recent decision to raise subscription fees while cutting prices for its Bikes and other equipment?
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$MSFT Earnings
Some stats for those interested

  • Office Commercial products and cloud services revenue increased 12% (up 14%) driven by Office 365 Commercial revenue growth of 17% (up 20% CC)

  • Office Consumer products and cloud services revenue increased 11% (up 12%) and Microsoft 365 Consumer subscribers grew to 58.4 million

  • LinkedIn revenue increased 34% (up 35%)

  • Dynamics products and cloud services revenue increased 22% (up 25%) driven by Dynamics 365 revenue growth of 35% (up 38%)

  • Server products and cloud services revenue increased 29% (up 32%) driven by Azure and other cloud services revenue growth of 46% (up 49%)

  • Windows OEM revenue increased 11%

  • Windows Commercial products and cloud services revenue increased 14% (up 19%)

  • Xbox content and services revenue increased 4% (up 6%)

  • Search and news advertising revenue excluding traffic acquisition costs increased 23% (up 25%)

  • Surface revenue increased 13% (up 18%)

  • Microsoft returned $12.4 billion to shareholders in the form of share repurchases and dividends in the third quarter of fiscal year 2022, an increase of 25% compared to the third quarter of fiscal year 2021.
How you do it? This is how I do it...
Last Wednesday I shared that I added to some of my growth positions with the 15th paycheck. Looking at the market today, I could be thinking:

If I only knew about the sell-off last Friday...
If I only knew today would be even lower...

See, I don't worry about these things. I can't control the market nor I can predict the fluctuations.

So, here is what I decided to do many years ago, and I haven't found a better way. This works for me and my personal and family situation. FEEDBACK APPRECIATED!

  1. Every 2 weeks I use paycheck money to add to my portfolios. So I $ cost average. Currently, the allocations are set: 45% DRIP, 40% Growth, 15% Crypto. (I max out 401k and an IRA separately). My Real Estate portfolio is self-funding for new properties (it took years).
  2. I try my best to only invest in great businesses. Have I made mistakes? Hell yeah, however...
  3. I never go beyond 5% of cost basis in one position. This allows me to keep adding my positions in a controlled way, as the portfolio grows.
  4. I let the winners win. I only trim them on rare occasions.
  5. What about losers? You have to ask yourself, what is a loser... I don't sell stocks I am underwater except if I seriously find supporting data that tells me the business has a fundamental problem. I love comebacks and usually, this is how I reduce my cost basis.
  6. My bottom line on selling is: If I have doubts about adding to a position in red, then I ask myself why I hold it. This forces me to be objective. Sometimes I give a business an extra quarter or 2 to see if a business trend is confirmed. (I am in this situation now with a small $PTON position. Interested to see what Barry McCarthy will do. He has a great resume)

What you can expect doing what I do is:

  1. Because I am constantly adding, don't expect to see gains in the thousand %
  2. This might not work if you are looking to make the big bang winnings with a single stock, although 2020-2021 proved me wrong with $TSLA and a couple of others!!
  3. Peace of mind. I really value peace of mind.
Great strategy!

I do something similar by letting winners run and methodically adding to my highest rated positions. I have my target allocations to keep me in check, but will not trim back unless a winner really takes off and eclipses my "sleep number".

As far as selling, I have not done much - mainly trimming larger positions. I don't trim until I have hit a minimum holding period of 3 years, and only trim if the position is larger than my target allocation and performance is lacking. I never sell more than a quarter of my "overweight" shares at a time to control trimming.

Naturally, my "losers" will fall to the bottom and will not have new capital added. My plan is to sell any positions with less than 1% portfolio allocation after my 3 year holding period.
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