Update of portfolio from 24 - 30 May 2021

 Since January 2021, the stock markets evolved. China A shares and Tech fell by 20%. Emerging Tech like Tesla, Square, ARK ETFs fell by 30%. Whereas the old economy sectors moved higher. S&P500, European big caps, moved higher. Energy, mining, banking performed better.

 

I think the old economy China A shares are recovering fast. This will be followed by emerging tech, China tech, somewhere in June or July. Emerging markets too (Fidelity Emerging markets). It looks like a set up for a rally in the second half of 2021.

 

Here is an update of my investments. It is for sharing only. I find that putting my investments in a model portfolio helps me analyse where I made mistakes and correct them quickly.

 

New investments for the week:

 

  1. Taiwan Semiconductor, TSMC. I never liked foundry biz. I used to cover Chartered Semicon and the company ran to the ground. However, the world has an increased need more chips, from mobile devices to cars. There is a further need for power-saving chips as everything is run by batteries. TSMC is the biggest, most dominant player. I put a ½ position on this stock.
  2. Chicago Mercantile Exchange Group. I love this business. It’s like selling spades to the gold miners. Either way they will make money. Momentum play. Add another ¼ position.
  3. Salesforce. Customer relationship management, cloud computing. This is a strong business. Strong growth, low capex. Add another ¼ position.
  4. 2823 HK, UBS China A Opportunity and JPMorgan China A Opportunity. I detected the momentum turning up after a 10 – 15% drop. Add ¾ position.



 

My model portfolio rose 2.5% in the week, mostly contributed by my increased position in China A 50. All in I’m up 3.48% from 23 Mar to now (around 2 months).

 



 

 

The red line is my portfolio. At the point where I overweight China, the portfolio began to “follow” the trajectory of 2800 HK (China Benchmark).

 



My allocation is still 72.8% in the US. It has decreased from 75% because I increased my weightage in Chinese old economy stocks from 12 to 15.5%.

 



 

Top 10 performing stocks:

 

  1. Shorting MicroStrategy earned me 32.9% because I believed the Crypto they own will drag them down.
  2. 18.4% for China A50 or UBS China A, or JPMorgan China A.
  3. Facebook. Up 12.6%
  4. UnitedHealth Group 12.0%. Biggest private healthcare insurance.
  5. YUM China is up 11.3%. F&B biz is booming even in a lockdown. People will still order KFC and Pizza takeaways in China. Pizza Hut I really hate because it’s not wood fired pizza and I’m quite particular about how my Pizza is made. It’s gotta be a crispy crust with melted, liquid cheese with Salami or the Chicago Deep Dish.
  6. US Healthcare Providers ETF is up 9.3%.
  7. S&P Global (S&P rating agency) up 9.3%.
  8. Lockheed Martin up 8.7%.
  9. iShares Europe up 7.9%. Finally…. The giant awakens. Mostly driven by financials. Look at Natixis and Deutsche Bank.

 

 



 

Bottom 10 are:

 

  1. MercadoLibre down 7.9%. Biggest e-commerce player in Latin America. I’ll hold this. Big growth coming.
  2. Alibaba down 10.8%. e-commerce giant of China that’s temporarily sick. Hold.
  3. SEA Ltd. Down 11%. E-commerce giant of ASEAN. Hold
  4. JD. Down 11.4%. E-commerce of China. Hold.
  5. NIO. Down 11.8%. 3rd or 4th largest EV in China. Watch out as hedge fund managers cover their shorts on this. It could rebound. HOLD.
  6. ARK Genomic Revolution. Down 14.3%. After a horrible quarter, Cathie Wood may come back.
  7. Square. Down 13.6%. HOLD
  8. ARK Innovation. Down 14.3%. HOLD
  9. Shanghai International Airport. Down 16.1%. HOLD
  10. Lemonade. Down 16.9%. HOLD.

 

Notice that the worst performers are down less. Last week, the worst was either Shanghai Airport or Lemonade, down 20%. It is down 17%. There are nascent signs of recovery now.



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