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No one at Get Irked is a professional financial adviser. All information provided on this website is for entertainment and educational purposes only. All investments involve risk, all equities could lose value, and investors are responsible for their own choices. Consult with your own financial adviser to see if any of these positions and strategies fit your risk profile and long-term financial goals.

Pandemic Portfolio: Update #8

This is an update to a series. See Starting a Portfolio from Scratch to learn how it started.

Sector Rotation – Bye, Bye Growth?

It’s been an interesting few weeks as investors have started to rotate out of the high-flying growth tech stocks and into value plays that had underperformed the market’s recent moves.

Accordingly, a lot of positions involving technology sold off over the past few weeks and hedge positions such as gold also dropped as investors moved their money into “risk-on” positions.

This movement provided me with the opportunity to Buy In Stages with a few of my positions, adding when others sold them down.

Barrick Gold (GOLD): Added to Position

Current Price: $22.68
Per-Share Cost: $25.17 (-4.114% from last update)
Profit/Loss: -9.90%
Allocation: 2.900%*
Next Buy Target: $21.30

Barrick Gold (GOLD) lost support last week when the market rallied as investors typically use gold as a hedge. Accordingly, investors sold their gold to buy equities and stocks in order to take advantage of the upside.

In my experience as a long-term investor, I prefer to buy weakness and sell strength, so I used trailing stop orders on November 18-19 to add more shares with an average buying price of $24.45.

Gold continued to lose support this week, with an order filling at $23.39 on Monday, November 23, and another order on Wednesday, November 25 at $22.77 which gave a total average buying price of $23.70 for all of the orders.

The combined orders lowered my per-share cost -4.114% from $26.25 to $25.17. From here, my next buy target is $21.30.

As of the writing of this update, GOLD closed at $22.68, down -4.30% from my total average buy price of $23.70.

Costco (COST): Dividend Reinvestment 

Current Price: $388.39
Per-Share Cost: $302.94 (-0.18% from last update)
Profit/Loss: +28.21%
Allocation: 3.835%*
Next Buy Target: Depends…

Costco (COST) paid out its quarterly dividend of $0.70 per share on Monday, November 16, 2020. At its closing price of $380.22 that night, it provided an annual yield of 0.74%. That’s certainly nothing to get too excited about, but given how amazing a performer this stock is, the growth far exceeds the dividend.

The payout lowered my per-share cost -0.18% from $303.50 to $302.94. Not a big move, but given all I had to do was hold the stock and reinvest the dividend, I’ll take it.

Later on, COST announced one of its “special dividends,” this time a $10 dividend. A special dividend is a one-time payment made per-share for all holders of a stock. As of Friday’s close of $388.39, a $10 dividend is a whopping 2.57% payout, not too shabby.

Key to this special dividend is that it’s paid out to all holders of a stock as of a certain date, in this case, December 1. So, if you buy some Costco before the market close on December 1, you will get $10 per share.

COST is very near its all-time highs, so I’m bouncing around the idea of whether I should pick up some more, raise my per-share cost, but get a $10 “discount” on each share I buy before December 1. Accordingly, my price target is around $382.00.

If COST sells off before December 1, I’ll add some more to my portfolio. If not, I’ll wait until Costco drops to lower levels, eyeing $370.30, specifically. 

Crown Castle (CCI): Strategy Update

Current Price: $167.17
Per-Share Cost: $162.50 (Unchanged from last update)
Profit/Loss: +2.87%
Allocation: 4.135%*
Next Buy Target: $155.40

Crown Castle (CCI) continues to bounce between the mid-$150s to the upper $160s as the activist investors try to get some of their ideas approved by management. Given its ongoing exposure to the rollout of 5G, my next buy target is slightly above the low of its most recent pullback at $155.40.

Digital Realty Trust (DLR): Added to Position

Current Price: $136.73
Per-Share Cost: $137.72 (-0.355% from last update)
Profit/Loss: -0.72%
Allocation: 4.738%*
Next Buy Target: $130.60

Digital Realty Trust (DLR) has proven to be incredibly volatile historically as it sold off in the midst of the market-wide rally this week leading me to add a little more with a buy order which filled on Tuesday, November 24 at $134.78.

The buy lowered my per-share cost by -0.355% from $138.21 to $137.21, a total decrease of -3.93% from where I first bought the stock at $143.35. My next buy target for the stock is $130.60.

Given that many investors rolled out of growth stocks into value stocks over the past few weeks, it’s no surprise that some decided to exit this excellent Real Estate Investment Trust (REIT) focusing on data centers.

DLR closed the week of writing at $136.73, up +1.45% from where I added.

Microsoft (MSFT): Strategy Update

Current Price: $215.23
Per-Share Cost: $187.53 (Unchanged from last update)
Profit/Loss: +14.77%
Allocation: 3.184%*
Next Buy Target: $203.60

Microsoft (MSFT) continues to remain a stalwart in the market. Despite the rotation out of growth generally, Microsoft (MSFT) saw very little movement to the downside. I’m willing to be patient and see what the next big break is for this stock, eyeing a buy target near the most recent selloff low at $203.60.

Pepsico (PEP): Strategy Update

Current Price: $144.60
Per-Share Cost: $129.41 (Unchanged from last update)
Profit/Loss: +11.74%
Allocation: 2.871%*
Next Buy Target: $130.60

Pepsico (PEP) continues to bounce between the low $130s and the high $140s during the past few rallies, leading me to wait patiently down near $130 with a price target at $130.60, slightly above a historical selloff low. If Pepsico eventually breaks out to the upside, I’ll revisit the strategy and determine if I’d like to buy more up at higher levels.

UnitedHealth (UNH): Strategy Update

Current Price: $337.94
Per-Share Cost: $280.03 (Unchanged from last update)
Profit/Loss: +20.68%
Allocation: 1.676%*
Next Buy Target: $307.90

After making new all-time highs much higher from these levels, health behemoth UnitedHealth (UNH) dropped substantially as healthcare fell out of favor with investors rotating into other sectors. That being said, this one is still up substantially from where I bought it. 

As much as I hate it doing it – particularly with a stock as volatile as UNH – I’ve decided to raise my next buy target to $307.90, quite a bit higher than my current per-share cost so I can increase my allocation in this position.