My Mock Portfolio Over the Last Few Months
I have been following a number of stocks over the last few months. I have felt that while the economy is not doing the best, that these companies will definitely survive. Here is the portfolio as of Friday, April 10th, 2009. After the picture, I go into how I went about choosing these stocks.
After following the markets, it is clear that many stocks have been affected by the market, and are depressed only because the entire market is depressed. I assume this is somehwhat due to people shorting indicies instead of individual stocks, which creates a correlation between stocks in a given sector.
My strategy has been simple. First, invest in stocks involved in expanding the internet. The internet is not going away; its growing faster than anything we have ever seen. Thus, infrastructure, such as cables, fiber optic, etc is largely in demand. The reason Comcast is not on my list is because I’m scared of antitrust suits against it.
Second, find stocks who’s prices are depressed past their lowest point in the last 5 years. My assumption is that there is some artificial pricing in the last 2-3 years. Similarly, many stocks around 2001 were mispriced due to the internet bubble. Thus, 2003-2005 are the steady years.
Of course, I look at the last few quarterly earnings, and compare them to make sure they equal or exceed that of the 2003-2005 vintage. If they do, then clearly the company must be worth more (even though the stock price is now depressed).
This strategy is simple and straightforward, but the timeline is at least 5 years.