Here's what I bought yesterday

Investing $2,500 | Round 6

Mar 16, 2021

Yesterday was the sixth purchasing round of the 2021 investment schedule. I’ll first cover the positions and then go through a bit of the thought process behind it.

Main Fund Purchases

#. Company / Stock Name (Ticker) - $ Amount | $ Cost Basis / Share

Arch Capital Group Ltd. (ACGL) - $300 | $37.50
Cboe Global Markets Inc. (CBOE) - $300 | $103.50
Check Point Software Technologies Ltd. (CHKP) - $300 | $116.25
D.R. Horton Inc. (DHI) - $300 | $81.50
Espey Mfg. & Electronics Corp. (ESP) - $300 | $15.15
Genmab (GMAB) - $300 | $33.45
Electronic Arts Inc. (EA) - $150 | $130.00
Emergent BioSolutions Inc. (EBS) - $150 | $90.50
Aberdeen Standard Physical Palladium Shares ETF (PALL) - $25 | $224.15
iShares Gold Trust (IAU) - $25 | $16.45
iShares Silver Trust (SLV) - $25 | $24.25
iShares 7-10 Year Treasury Bond ETF (IEF) - $25 | $113.95
Residual Cash - $300

Some Qualitative Thoughts

Just like with the last investment round, I’ve been doing a broader spread of buying, this time across twelve different investments.

Two of the stock purchases, ACGL and DHI, were a result of digging into the analysis I did previously on the short-term relative underperformance for mid-cap value stocks. The hope is that this group of stocks will rebound back to the trend. So, I took a look at some of the constituents in that fund and picked two that had good fundamentals.

CBOE, CHKP, ESP, and GMAB are four new stocks to the portfolio that were a result of a broader market scan for stocks with good financials, profitability, and valuation. The challenge for stocks that appear to have good valuation prospects is that they sometimes have underperformed to get there. A guarantee that they will suddenly rebound will never happen but, in the long run, the hope is that the undervaluation suggested by various metrics will lead to excess return.

For EA and EBS, these are stocks I’ve already invested in that have declined. In regards to EBS, I am confident to buy more. On the other hand, EA has been a huge disappointment and also a stock I didn’t feel totally comfortable buying but I’m adding for the long run given how much it has dropped.

I also bought a small stake in some Platinum and Silver for the first time, while also adding to my usual Gold and Bond purchases. I like the diversification here but don’t want too much weight unless there is a solid decline. I also held three hundred in residual cash for a rainy day.

In terms of buying, patience paid off today as the market had a slight dip mid day and I was able to get favorable entries for most of the purchases. As for the end of the day rally we had, well, it’s always nice to see some return right away!

Some Quantitative Thoughts

Right now, the portfolio is running fairly in line with the S&P with the exception of being underweight communication and overweight energy and financials:

Domestic stocks have done extremely well for some time now so it’s not a super specific decision to be underweight US stocks but it’s happened somewhat by chance as I’ve just happened to find a lot of foreign names I like:

The S&P 500 is, of course, going to have mostly large and established companies but there are lots of opportunities outside of that too, so I feel good about the size allocation now and might even look for more mid and small cap stocks to add:

Overall, I’m really happy with the setup of the portfolio right now. For the most part, I wouldn’t change any of the choices made thus far. My only disappointment has a been the general S&P 500 correlation and the slight underperformance up to this point but that could change quickly (and hopefully will for the better). Anyways, let’s see what the next two weeks in the market has to offer us!

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