Will this year bring a “wealth wipeout” as President Biden makes some effort to roll back the tax cuts of a few years ago, or as interest rates rise? Or will it be a massive rebound year thanks to government stimulus, really strong balance sheets among regular folks who have kept their jobs through the pandemic but haven’t been able to spend much, and a re-opening of economic activity as the vaccinations proliferate?
I don’t know, and it’s also quite possible that the growth will be fantastic… but that the ebullient stock market of the past year has already overcompensated for that.
I can’t tell you what the future will hold, of course, but I’ve now at least completed my annual review… so I know what I think of all of my investments, today.
If you’ve missed those prior installments over the past few weeks, I do this “check in” once a year — so I’ve now looked at each of the stocks in the Real Money Portfolio and made some kind of value/opinion assessment or update to reset my thinking for another year (now that I’m pushing 60 stocks in that portfolio, it takes a while). A lot of these companies are ones that I watch pretty closely every quarter and write about pretty regularly, but there are a few that often slip through the cracks without a lot of big news items, and I do want to make sure to check in on all of them, try to apply at least a little analytical discipline and be specific about a current opinion on the price or value, and see how they stack up at least once a year.
I should note that I may be a little short of the discipline I might like to think I can follow in a perfect world, because I didn’t sell much of anything as part of this process, despite the fact that a lot of stocks I own have traded, particularly at the peak earlier this year, at valuations which can’t really be justified in any historical context… but at least this positions me to be ready to move if stocks move meaningfully and create either stop loss signals or buy signals in my addled brain. And in a few cases, I’m feeling a little greedy so I’m really hoping that we get to a ...