Hello everyone, welcome to BudgetHolics. Here is my investing strategy for 2021!
2020 Overview
2020 has been a great year for most investors. I had a return of 120% which I know is not duplicable. If you want to learn more about my best stocks of 2020 check out this video, but you should know these results are not duplicable. A lot of it was due to sheer luck. 2020 was a great year to start investing, and moreover, the companies that already fell within my circle of competence, the companies that did well, were the biggest winners of this past year. There is no way this is going to happen again in 2021. And we should all realise that. You making a good choice, or having a good overall year, doesn’t make you an investing Guru. As you can see from that video, most of my profits came from a handful of companies, which I was then able to use and buy other companies, which, at the time were undervalued or fairly valued.
Active Investing
My strategy only involves active investing. No ETFs, no Index Funds. Prices are inflated, with the 2nd stimulus bill in the works, prices are going to go up even more. Most companies in my portfolio are currently overvalued.
Inflated asset prices, a slow rollout of vaccines and further lockdowns are a clear indicator of an imminent stock market crash. Or at least a correction. I’ve made a full analysis of my thoughts on the 2021 stock market crash, if you want to learn more, check out my video.
Timing the market is pointless though. You don’t know when the stock market is going to crash and you could lose months or even years worth of profits by trying to find the right time to invest. Although keeping some investing cash on the side is a good habit, as ti will allow you to grasp good investment opportunities.
Increasing Circle of Competence
I will also seek to widen my Circle of Competence, with respect to both Asset Classes, and Assets.
Crypto
For the past months I’ve been studying up and researching cryptocurrencies, the technologies behind them, their possible application, and their future impact into the world. Particularly I’ve been looking into BTC and ETH as the main assets, extending my research into BCH and smaller cryptocurrencies, in terms of market cap.
My goal for this year is to better my understanding in Crypto, as I will keep DACing into that specific class, and start learning about real estate. From what I have gathered so far, when you look into real estate you need to look into the fundamental characteristics of the region you will invest in.
Stocks
IPOs will continue to stay in sight. A lot of companies going public like stripe, Instacart, Robinhood and Coinbase. Will be rebalancing the portfolio. Trying to DAC in other assets, the main focus is the building of a dividend portfolio.
I am aiming for a 70-30 dividend paying stocks, and I am expecting some companies, like Apple, to overlap.
A lot will depend on the price. Most of the companies in my portfolio are overvalued, and regardless of the type of stock investor you are, dividend or growth, you should always look to buy a good price.
Let me know what is your investing strategy for 2021, and if you enjoyed this article please subscribe to both my read.chash page, and my YouTube Channel!