At the beginning of the year, I shared my financial journey with you. If you have yet to read it, please do so here.
As an accountability measure, I thought I’d share regular updates as I continue my financial journey. I contemplated monthly updates, but I don’t do a ton of exciting investments or trades. A year might be too long too. I figure, if a company can share their progress quarterly, I can do the same.
I’ve labeled it the Blue Jean Recap because I wash my blue jeans once each quarter, so my recaps will occur when I fire up the washing machine.
Before I begin, it might be best to share my overall investing strategy. For the most part, I’m a fan of Warren Buffett and Charlie Munger. I gravitate to their style of investing, valuing companies, and then buying when the price of that company falls below the value.
I started option trading with a portion of my funds this year, limiting myself to lower-risk trades and those that could help me get into/out of my stock picks at better prices or reduce my cost basis.
Our goal this year is to increase our net worth by 30%. Given the state of the markets and our ability to liquidate some unnecessary items, we’re more than three-quarters of the way to reaching our 30% goal. That. is. crazy.
IF everything continues as it is, I expect us to reach our goal by the end of May.
That said, I lean pessimistic regarding the market. As things reopen, I still think we’re going to realize that some things will not return to the old normal.
- Though jobless rates are coming down, there are just some jobs that no longer exist.
- Many small businesses without cash reserves weren’t able to weather the storm.
- Residential property is going through the roof but what comes of commercial, like office buildings.
- Bond rates are going up.
- There aren’t enough shipping containers in the world.
- The stock market is historically and significantly overvalued.
I could list more, but my main point is that I see opportunities for corrections and market adjustments.
That said, I don’t think we’re without opportunities to park our money today. I’ve been reviewing companies and moving when I see an opening.
I keep my 401K separated from my other positions because there’s not a whole lot I can do with it. I have a small number of funds that I may invest in. You’d likely see it moving between a general S&P fund and a bond fund, depending on what the market is doing at any given time.
My stocks are generally held in tax advantaged accounts, Roth and HSA.
As for the stocks I’m currently holding, they include Verizon, Berkshire Hathaway – B, Tesla, and Kroger.
At some point, I might further explain why I’m in each position but not at the moment. I would note, Tesla is my one speculation rather than investment play.
I trade options with my cash position while waiting for a potential investment. My first option was an iron condor I opened on 2/25 in the SPY index. The options expire on 4/16 and I can tell I’m not extremely comfortable with it. I’ll give greater thought to potential iron condors in the future.
Over the previous month I’ve grown my cash position by 4.94% using options.
If you have any questions regarding my activities and how I make my picks, please feel free to ask.