Hey everyone, I'm excited to share my investment strategy for 2023. Let's get into it.
Portfolio Overview and Performance Analysis
First, let's recap how my portfolio did in 2022. I was up 40% on the year. I know that's a great return, but I also know that a lot of it was luck. The stock market was up big in 2022, and I was heavily invested in the stock market. So, I benefited from the overall market performance.
Contrarian Approach for 2023 Investment Strategy
For 2023, my goal is to be contrarian. I want to invest in areas that are out of favor and underappreciated. This means I'll be investing in areas that have not performed well recently.
Shift from Domestic to Emerging Market Index Funds
I've already started making changes to my portfolio to reflect this new strategy. For example, I've reallocated some of my retirement account funds from domestic index funds to emerging market index funds.
Rationale for Investing in Emerging Markets
I believe that emerging markets are currently undervalued and have the potential for strong growth in the future. There are several macroeconomic factors that support this view, including demographic trends and technological advancements.
View on Stock Market and Index Funds as Wealth Generators
I still believe that the stock market and index funds are great wealth generators over the long term. However, I think there are other areas of the market that have more potential for outsized returns in the near future.
Portfolio Management: From Diversification to Concentration
In order to take advantage of these opportunities, I'm transitioning from a diversified stock portfolio to a more concentrated one with fewer holdings.
Specific Stocks in Portfolio
Here are some of the specific stocks that are currently in my portfolio:
I own several dividend stocks, including JP Morgan (JPM), Air Products (APD), and Johnson & Johnson (JNJ).
Individual Stock: CrowdStrike
I also own individual stocks like CrowdStrike (CRWD). I bought CrowdStrike after it dipped significantly from its all-time high. I believe that cybersecurity is a growing industry with a lot of potential, so I think CrowdStrike has a bright future.
Investment Strategy for CrowdStrike
If CrowdStrike continues to fall, I'll buy more shares at lower prices. This will help me lower my average cost per share and increase my potential returns when the stock eventually recovers.
Thesis on Commodities and Industrials
I'm also bullish on commodities and industrials. These sectors have historically been underinvested, so there's a lot of catching up to do. Additionally, macroeconomic factors like inflation and supply chain disruptions are driving up prices for commodities and industrial goods.
Position on Gold and Gold Mining Companies
I'm particularly interested in gold as a hedge against inflation. While gold prices have been relatively flat recently, I think they have room to grow as inflation persists. As a result, I've invested in gold mining companies like Barrick Gold (GOLD) as a way to gain exposure to gold prices.
Non-Disclosure of Smaller Company Investments
There are other smaller companies that I've invested in as well, but I won't disclose them here because I don't want to influence their stock prices.
Other Areas of Investment
In addition to stocks, I'm also investing in other areas such as venture funds, land, small businesses, and cash reserves.
Venture Fund with AskSebi
I've partnered with AskSebi on a venture fund focused on early stage consumer facing tech companies. This is a long-term investment that will take time to generate returns, but I believe it has the potential for significant upside.
I'm also investing in land for timber or farmland. This is a unique asset class that provides diversification and potential cash flow through forest management or agricultural activities.
AcreTrader Syndication Option
For those interested in farmland investments but don't want to manage the land themselves, AcreTrader offers syndication options where investors can buy shares of farmland properties managed by AcreTrader.
Small Business Investments
I've made investments into small businesses such as e-commerce stores, YouTube channels, or blogs. These investments provide startup capital or lend money at an interest rate higher than what traditional banks offer.
Cash Reserves Strategy
Finally, I'm keeping some of my money in cash reserves using money market accounts or high interest savings accounts that offer over three percent annual interest. This allows me to earn some return on my cash while keeping it readily accessible for future investment opportunities.
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