Around the New Year most of us reflect on what we accomplished over the past 12 months. In my personal life I renovated my house, battled a minor health problem, and navigated a struggling industrial market at work. From a financial standpoint, my portfolio increased by nearly 50% YOY. In January 2019, it was valued at roughly $106,000. By the end of 2019 the portfolio had grown to $157,000. Dividend income came in at just over $4000 up from $2600 the previous year. The resurgence in my account balance came largely from substantial market gains and frugal living. Overall, I managed to save 50% of my income. The other half went to living expenses, a new furnace/AC unit, and medical bills. Even better, the S&P was up 28.9% YOY, the best year since 2013. These gains did, however, follow a nasty crash in December 2018.
In 2019 my big winners were P&G, Apple, and Target. P&G completed its turnaround and saw healthy organic sales growth throughout 2019. The company sold off sluggish brands in favor of more natural, targeted start-ups. Apple, meanwhile, continued its push towards services and even launched its own streaming app. Like P&G, Target also completed its turnaround strategy. The company’s investments in its physical stores coupled with its ecommerce growth drove healthy sales numbers. Late in the year, I had some net new positions gain 30%+ in just a few months; ABBV & LEG. Another blogger I follow helped me identify the value in these two stocks, allowing me to buy at the very bottom.
In terms of weakness, my international securities lagged. I’m up or about even with all my ADRs. Scotiabank has acted like a bond proxy, paying 4-5%, and hanging around $55/share. Ditto Rio Tinto (RIO) and Canon (CAJ). Unilever, out of the U.K., was a big winner, but reported a bad quarter at the end of the year. Infosys, my Indian business services conglomerate, faced an accounting scandal, causing its price to move lower. My biggest loser was Exxon Mobil (XOM), languishing at a -14% loss. Oil prices remained low the entire year, crimping profits. Exxon’s future looks better with oil prices rising and the company’s massive expansion in the Permian Basin.
My goals for 2020 include rebuilding my business at work and achieving a portfolio value of $200,000. At work we had a challenging year as the industrial market contracted and our largest customer moved states. Therefore, I need to land another so called “whale” of a customer this year and continue to develop the business already on the books. I have to grow more than usual sales-wise to make up 2019’s shortfalls. This plays into my 2nd goal of achieving my next 100k. To reach $200,000 I would need to have an average year in the market (8-10%) and again save half of my income. If you’ve been following me for a while, you’ll see scale helps a lot when investing. The first $100k is always the hardest. But when you finally get there, you may find investments outperform that of your own income.
DISCLAIMER: I am long on PG, AAPL, TGT, ABBV, LEG, BNS, RIO, CAJ, INFY, UL, and XOM. I am not a licensed investment adviser or tax professional. I am not liable for any losses incurred by any parties. This blog should be viewed for entertainment and/or educational purposes only. Any transactions published are not recommendations to buy or sell any securities. Please consult with an investment professional before making investment decisions.