2022 - Risky Small Cap Stock Picks

 Following 20 stocks are my picks for 2022 which are categorized as small cap (as all of them are valued below 10 Billion Dollars). They are up significantly in 2021 - hence there is a risk associated with these names, but some of them will continue to find buyers in 2022 and are good long term picks. 

2 PM - Dec 27 Price

AMBA 208.35

BMBL 33.84

BOOT 122.9

BROS 52.47

CELH 74.39

CPE         53

CROX 127.63

CYBR 176.8

DOCN 84.38

GLBE 61.43

HIMX 13.82

HUT 8.89

INMD 72.58

PLBY 29.36

SEAS 66.85

SI        164.32

SITM 296.18

SKIN 23.84

TDC 44.21

ZIM        54.79

SPY 476.04

QQQ 402.88

RISKY BETS - TIER 4 PORTFOLIO UPDATE

Removed SAM to Tier 1 - Top 50 stock from current portfolio. 

Removed following stocks and moved them to "Trend - Tier 2" portfolio. 

• CHGG
• ERJ
• SAGE
• SRPT
• VIR
• MRNA
• RKT

Removed following stocks and moved them to "Favorite Stocks - Tier 3" portfolio. 

• CELH
• CCL
• DAL
• VIAC

Updated Risky Bets Tier 4 Portfolio with following allocation: 

Following 14 stocks with 3% Allocation: 

• APPS
• BEAM
• BMBL
• DISCA
• EXAS
• FOUR
• FSLY
• JAZZ
• PENN
• RDFN
• REGI
• SABR
• WYNN
• ZNGA

Following 18 stocks with 2% Allocation: 

• AFRM
• BBY
• CRM
• ESTC
• ETSY
• FB
• FTCH
• HUBS
• HUT
• MNDY
• MTTR
• NTES
• PLBY
• PUBM
• SHOP
• SIVB
• ZI
• ZIP

Following 22 stocks with 1% Allocation: 

• AI
• BYND
• CGC
• DDD
• DOCU
• FVRR
• GDRX
• IRBT
• JOBY
• LMND
• LZ
• MGNI
• MS
• PAGS
• PLUG
• PSTG
• SAVA
• SPCE
• VRM
• XPEV
• YNDX
• YOU

Following 28 stocks are completely removed from all lists. 

• CHPT
• CHWY
• CSIQ
• EDIT
• EXPI
• FCEL
• FROG
• FUTU
• LAZR
• LILM
• LSPD
• MARA
• MQ
• MSTR
• PACB
• PATH
• QS
• RUN
• SAVA
• SFIX
• SHAK
• SKLZ
• SNAP
• SOFI
• TOST
• UPWK
• WISH
• ZM

UPDATED FAVORITE STOCK PORTFOLIO - TIER 3

 Removed Z (Zillow) and ROKU from favorite stocks to move them to Tier 1 - Top 50 Stocks. 

Updated Favorite list of stocks portfolio with following allocation: 

Following 11 stocks with 3% Allocation: 

• ATVI
• BABA
• CELH
• DBX
• DFS
• DPZ
• HON
• JCI
• PTON
• SPOT
• TWLO

Following 23 stocks with 2% Allocation: 

• ABNB
• AMD
• BA
• BILL
• CVNA
• CYBR
• DKNG
• DKS
• ENPH
• HOOD
• LULU
• LYFT
• MDB
• MTCH
• NFLX
• NIO
• NVDA
• PINS
• TDOC
• TWTR
• UBER
• UPST
• ZIM

Following 21 stocks with 1% Allocation: 

• ALLY
• BMY
• CCL
• DAL
• DXCM
• JD
• MELI
• PLTR
• PYPL
• RH
• SE
• SGEN
• SQ
• TGT
• TTD
• U
• URI
• VIAC
• WAL
• WM
• ZS

UPDATED TREND PORTFOLIO (TIER 2)

Removed Stocks from Trend Portfolio are: 

• AFRM
• BBY
• ETSY
• FTCH
• HUBS
• MNDY
• NTES
• SHOP
• SIVB
• ZI
• CRM
• ESTC
• HUT
• MTTR
• PLBY
• PUBM
• ZIP

Updated portfolio allocation for Trend Portfolio is: 

(Following 40 stocks with 2% Allocation):

• AMBA
• ARE
• ATKR
• AVTR
• BBWI
• BJ
• BKNG
• CHGG
• CNC
• CPRI
• CVS
• EL
• ERJ
• FBHS
• FTNT
• IBM
• IQV
• KR
• LITE
• MKC
• MRNA
• MRVI
• MRVL
• NKE
• NOW
• ON
• PANW
• POOL
• QGEN
• RACE
• RKT
• SAGE
• SRPT
• TJX
• TMO
• VIR
• VRTX
• YUM
• ZBRA
• ZION

(Following 20 stocks with 1% Allocation):

• ASAN
• BOOT
• COIN
• COMM
• CROX
• CRWD
• DASH
• DDOG
• DNUT
• HIMX
• INMD
• NAVI
• NET
• RBLX
• S
• SEDG
• SMAR
• SNOW
• TSLA
• XLNX

TOP 50 STOCKS CHANGES

 It has been one month since I picked top 50 stocks and result is not as good as expected. There are more than 22 stocks which saw more than 10% correction and they need to be replaced with other better stocks. 

So, the stocks which are getting dropped from Top 50 are: 

1. ABNB
2. AMD
3. BA
4. BILL
5. CYBR
6. DKS
7. DXCM
8. ENPH
9. JD
10. LULU
11. MDB
12. NFLX
13. NVDA
14. RH
15. SE
16. SGEN
17. TTD
18. U
19. URI
20. WAL
21. ZIM
22. ZS

Most of them are moved to either Tier 3 (which is collection of my favorite stocks) and rest to Tier 4 (Risky list). All are great companies and good stocks, just not in trend anymore and usually when stock is corrected over 10%, it continue to see more correction, so better to be cautious. At the same time, its better to reward companies which are outperforming since last one month. So newest additions are: 

1. AAPL
2. AMGN
3. ANET
4. AVGO
5. DLTR
6. EMN
7. FDX
8. GD
9. HPQ
10. INTU
11. PEP
12. ROKU
13. SAM
14. SHW
15. STZ
16. TECK
17. TNDM
18. UI
19. ULTA
20. V
21. Z
22. ZTS

Many of these stocks were already part of my Tier 2, Tier 3 and Tier 4 list. ANET, TECK, TNDM, ZTS, SHW, STZ, UI were part of Tier 2 group, ROKU and Z were in my favorite list of Tier 3 and SAM was part of Tier 4. Some of them are sort of direct replacement, such as TNDM outperforming DXCM and General Dynamics outperforming BA in Aerospace. Apple, AMGN were part of dividend portfolio and performing better. 

My thoughts on crypto

I always believed - and still do - that 5% of your total worth has to be invested in GOLD. When crypto was introduced (not back in 2008, but sometime in 2017-2018) to mainstream media and each household as the topic of discussion - I believed - we should at least nibble with 1% of total worth in it. That 1% was taken away from GOLD allocation and it was insignificant to your overall worth but good enough allocation to a new asset class to begin with. 

When Bitcoin was flying each day from 10,000$ to 18,000$ - it did felt amazing, but when it tanked from 18000$ to 3,000$ it felt miserable. But losing 70% from 1% of your worth did not created a dent. Good time to pick it back up was when it crossed the milestone of 10,000$. I did mention it to our advanced trading group in Whatsapp that's the time to get back in. It was worth it to see it fly from 10,000$ to 60,000$. 

Bitcoin consolidated a bit and was unable to form higher highs and I got out and sold all my crypto allocation when it was 56000$. It felt bad initially - as I saw Bitcoin went to 62000$ after I sold it, and based on chart analysis - I said to myself - if it crosses 66000$ - I must get back in. Fortunately it didn't and then it was a falling knife until it hit 30,000$. 

Another area which might have been a great entry to see it get back to 60,000$. I traded a bit from 30K to 34K, 38K to 44K, 50K to 54K but those were all small trades and I was taking profit for 10-20-30% gains. Today, as of now, I do not own any Bitcoin or any other crypto and hesitant to do so as Fed is tapering. It would be difficult for crypto to find new money going forward. However, there is a general consensus that Bitcoin will see 100,000$ mark in near future. 

I may trade Bitcoin if it crosses 66000$ in near future as next step would be 78000$ but apart from that I would be hesitant to invest in Crypto at this point. Its about "Risk-Reward" and although there is a chance that Bitcoin can go from 47K to 100K (that's just 100% return). However, Bitcoin becomes interesting to me if it goes near 20K (because then from 20K to 100K would be 500% return and that would be worth the risk). I may not go all in at 20K but I would certainly initiate a position at 20K and continue to dollar cost average until it hit 10K and by 10K - I would have my full position (the one that I sold when it was at 56000) with Stop Loss of 7,500$. If Bitcoin goes below 7,500$ that would be bye bye moment. 

Stock Market Weekly Review (Nov 29-Dec 03 2021)

 

Small cap's IWM got destroyed two consecutive week's now - tanking 4% last week and 5% this week. New Covid variant is why re-opening economy stocks are getting sold off, Fed Tapering is the second reason why many growth stocks are tanking and De-listing of Chinese stocks from US Market is causing Chinese names are getting sell off. 

Some of the notable movers on the down side are: 

Fed Tapering Growth Names Plunge: NFLX, CRM (-9%), FB, ADBE (7%), TSLA (6%), DOCU (-45%), ASAN (-36%), ESTC (-26%), HOOD - AFRM - DKNG - BILL - ETSY - NET - TOST - QS - S (-20%), 

MQ, MNDY, ZI, U, UPST, PLUG, SOFI, ZM, MELI, PINS, DASH, TDOC (-15-20%), CRWD, W, SE, VEEV, ROKU, MDB, COIN, ENPH, DXCM, UBER, SGEN, PATH (-10-15%)

Other Notable sellers are: YOU, SKIN, INMD, AI, SI, LAZR etc (more than 15% sell off). 

Chinese Tickers due to delisting: BABA (-16%), PDD, BILI, NIO (-20%), TME, XPEV (-15%), JD (-12%) , IQ (-27%) FUTU (-20%) etc. 

Few Names that ended the week on positive are: ABT, AAPL (3%), certain chip names such as AMBA, MRVL, ON, NXPI, MCHP as well as Z (due to Buy back news), HPQ (good ER) and SHW (at all time high), and some biotech names such as (VIR, ADGI). 

Next Week - watch out for re-opening the economy stocks rebound as new variant does not seems to be that deadly. 

Weekly Review (Nov 22-26 2021) - Thanksgiving Week

Weekly performance of major etf's:  

From Mega Cap's: ASML down 11%.

Payment Processing (FINTECH) continue to sell off: MA, V, PYPL etc.

Defensive names ended up in green: PFE, COST, WMT, VZ etc.

Correction in the Large Caps: 

ASAN, DOCN, ADSK, FTCH, OPEN, S, PDD, M, RCL, DASH, OKTA, BBY, ABNB, MNDY, CCL, ESTC, LSPD, LYFT, YNDX, ZM, MELI, BA, CRWD, TDOC, SOFI, DLO, TEAM, AXP, U, FIVN

MRNA (Vaccine name) along with BNTX were up huge: 31% and 27% respectively due to new covid variant found in South Africa.

Other Notable Large Cap Winners: MRVI, HPQ (ER), MU, XPEV (ER), W, INTU, BMRN, DLTR (ER), GH (looks good for long term). 

Mid-Cap Sell off: JWN, GPS, PLAN, FL, SABR, NCLH, KSS, YOU, FOUR, PAGS,BEAM, FVRR, CYBR, MGNI

Mid- Cap Winners: NEGG, SAVA, VIR, SITM, 

Million Dollar Plan

 Although, it seems like market is forming a near term Top - as federal bank has started tapering the bond purchase program - historically speaking, market always rebounds due to TINA (There is no alternative) factor. 

To take advantage of upcoming downturn plan is to invest iteratively. I have distributed stocks in the following four categories: 

1) Top 50 Stocks: These are - in my opinion - best 50 stocks - as of today. I would prefer to keep this list as is at least for a year - if not 10 years. There might be some changes in it - if the fundamental story behind it changes. 

2) Trend Portfolio: These are after the 50 stocks picked in the 1st list - however they are in the uptrend. This list will always needs some update - if not each quarter - may be after each month. As often - trend sometimes form the near term top while big money moves to new other alternatives. Nevertheless this list has 62 stocks as of now - out of which 39 of them are more preferred compare to other 22, so 39 of them will get double the allocation within this portfolio. 

3) Beaten Down Growth Stocks: It is a small list of my favorite stocks - 20 to be precise. But they are in downtrend and hence sort of falling knife. But for bargain hunters - it is the best opportunity to buy them at a discounted price. 

4) Risky Bets: Fourth list has the more risk involved. Its the list of 70 stocks - which are beaten down - but some of them provide great opportunity for long term winners. 

In my opinion, if you are planning to invest in all four portfolio's - you may put 400$ in Top 50 Stocks, 300$ in Trend Portfolio, 200$ in Beaten Down Growth Stocks and 100$ in Risky bets. This way, you are putting maximum amount in best at the same time not missing out on potential multi baggers. Whether you can afford to invest 1000$ per week or twice a month or month - depends entirely upon you. 

Should you choose to put 1000$ (in above mentioned 4 portfolio's) per week, that will be 52000$ per year and 260,000$ in 5 years. My expectation is that after 5 years, these portfolio combined should have close to million dollar (if not more) - hence the title Million Dollar Plan. 

List of Top 50 Stocks: 

1. ABNB
2. ABT
3. AMD
4. AMZN
5. AXP
6. BA
7. BAC
8. BILL
9. BLDR
10. CF
11. CMG
12. COF
13. COST
14. CRL
15. CYBR
16. DIS
17. DKS
18. DXCM
19. ENPH
20. EXPE
21. FND
22. GRMN
23. H
24. HLT
25. HZNP
26. JD
27. LHX
28. LRCX
29. LULU
30. LYV
31. MCHP
32. MDB
33. MIDD
34. MOH
35. NFLX
36. NVDA
37. OKTA
38. RH
39. SBUX
40. SE
41. SGEN
42. TMUS
43. TSCO
44. TTD
45. TTWO
46. U
47. URI
48. WAL
49. ZIM
50. ZS

List of Trend Portfolio: 

The ones that gets double allocation: 

1. AFRM
2. AMBA
3. ANET
4. ASAN
5. BBY
6. BJ
7. BKNG
8. BOOT
9. COIN
10. CROX
11. DASH
12. DDOG
13. ETSY
14. FBHS
15. FTCH
16. FTNT
17. HUBS
18. INMD
19. INTU
20. MNDY
21. MRVL
22. NET
23. NOW
24. NTES
25. ON
26. PANW
27. POOL
28. RBLX
29. SEDG
30. SHOP
31. SIVB
32. TECK
33. TNDM
34. TSLA
35. ULTA
36. XLNX
37. ZBRA
38. ZI
39. ZTS

The ones that get single allocation: 

1. ATKR
2. BBWI
3. CPRI
4. CRM
5. CRWD
6. EL
7. ESTC
8. HUT
9. IQV
10. MTTR
11. NKE
12. PLBY
13. PUBM
14. QGEN
15. RACE
16. S
17. SHW
18. SNOW
19. STZ
20. UI
21. ZION
22. ZIP

Beaten Down Growth Stocks: 

1. ATVI
2. CVNA
3. DBX
4. DKNG
5. HOOD
6. LYFT
7. MELI
8. MTCH
9. NIO
10. PINS
11. PLTR
12. PTON
13. ROKU
14. SPOT
15. TDOC
16. TWLO
17. TWTR
18. UBER
19. UPST
20. Z

Risky Growth Picks: 

The Ones that get double the allocation: 

1. APPS
2. BMBL
3. BYND
4. CELH
5. CGC
6. CHGG
7. CHPT
8. CSIQ
9. ERJ
10. FOUR
11. FSLY
12. FVRR
13. IRBT
14. LILM
15. LMND
16. LZ
17. MGNI
18. PAGS
19. PLUG
20. RDFN
21. SAGE
22. SAVA
23. SFIX
24. SHAK
25. SOFI
26. SPCE
27. SRPT
28. VIR
29. VRM
30. WISH
31. YOU

The ones that get single allocation: 

1. AI
2. BEAM
3. CCL
4. CHWY
5. DAL
6. DDD
7. DISCA
8. EDIT
9. EXAS
10. EXPI
11. FCEL
12. FROG
13. FUTU
14. GDRX
15. JAZZ
16. LAZR
17. LSPD
18. MARA
19. MQ
20. MRNA
21. MSTR
22. PACB
23. PATH
24. PENN
25. QS
26. REGI
27. RKT
28. RUN
29. SABR
30. SAM
31. SKLZ
32. SNAP
33. TOST
34. UPWK
35. VIAC
36. WYNN
37. ZM
38. ZNGA

Apart from these lists, there is also one list for "Dividend Portfolio" - just in case you want to park your money - for consistent but slow growth - which will give better return than banks or fixed deposits or bond yields. 

1. AAPL
2. ABBV
3. AVGO
4. BMY
5. CFG
6. CVS
7. CVX
8. JEPI
9. JPM
10. MCD
11. NEE
12. PEP
13. PFE
14. PG
15. PSEC
16. QYLD
17. RYLD
18. SPG
19. SPYD
20. VZ

These lists are complex lists but it won't take more than one hour to set it up in M1-Finance or Robinhood (which allows fraction stocks trading). In my opinion, M1-Finance is best suited for this - as you can open multiple different accounts for each of these portfolio's. (something that I have done myself). You may use this referral link (https://m1.finance/fezeRdaR7PIt) to open new M1-Finance account(s) and you will get 30$ (and so will I). 

I will be constantly monitoring these portfolios - as they will need update - most likely once in a month. 

Good luck and Happy Investing !!! 

Update on ETF Investing

On March 4th, 2021 - I published following blog: 

https://viralpatel15.blogspot.com/2021/03/stock-market-beginner-advice.html

If you followed it and invested 5$ per day in these ETF's (I did), following are the return: 

SPY: 9.62%

QQQ: 15.11%

IWM: 3.75%

INDA: 9.53%

FXI: -6.57%

Overall, return of, 5.93% in roughly 9 months. 

50 Stock Trend Portfolio

On September, 2021 - I created list of 50 stocks and started investing in them iteratively, putting 200$ per week in M1Finance. 

Following is the initial list of these 50 stocks: 

1. AMZN
2. AXP
3. BILL
4. BLDR
5. CMG
6. COF
7. COST
8. CRL
9. CRWD
10. CVNA
11. CYBR
12. DAL
13. DBX
14. DKNG
15. DKS
16. DXCM
17. ENPH
18. EXPE
19. FDX
20. FND
21. FUTU
22. GRMN
23. H
24. JD
25. LHX
26. LRCX
27. LULU
28. LYV
29. MDB
30. MELI
31. MOH
32. MS
33. MTCH
34. NFLX
35. OKTA
36. PINS
37. PLTR
38. RH
39. SBUX
40. SGEN
41. SWKS
42. TDOC
43. TSCO
44. TTD
45. U
46. UBER
47. ULTA
48. WAL
49. Z
50. ZS

Since September, I made few changes to this list. I removed FUTU, ULTA and added TTWO and BA. 

Today, I am removing, AMZN, MS, SWKS and Z from the list and adding CF, MCHP, URI and V. 

JULY 26-JULY 30 2021 WEEKLY STOCK PICKS

20 LARGE CAP STOCKS TO INVEST IN

 Following are list of 20 stocks which are safe to invest in for near future. Even if they go down, due to market correction, these are some great companies which are going to outperform overall market given 3 to 5 year time frame. 

They are:

Amazon (AMZN), Mastercard (MA), Nvidia (NVDA), Disney (DIS), Abbvie (ABBV), 

SalesForce (CRM), Costco (COST), Pinduoduo (PDD), Honeywell (HON), Citigroup (C), 

Bristol Myers (BMY), Boeing (BA), Starbucks (SBUX), Raytheon (RTX), American Express (AXP), 

3M (MMM), CVS, Target (TGT), Square (SQ) and Intuitive Surgical (ISRG). 

These list of companies has range of companies to cover multiple industries. These companies are all worth over 100 billion in market cap, so the selection is from large cap industries and hence risk level is low. 

Stock Market Beginner Advice

 Full disclosure: I have been trading stocks since 2007. Lehmann brothers collapse destroyed my account in 2008. Although, I was investing from 2007 till 2016 - intermediately - I was not a full time trader until 2017. 

From 2017, I have spend roughly 40-60 hours on a weekly basis, doing lot of analysis and following is my advice for any beginner. 

Step 1: Open a stock trading account. (Although professionally speaking, TD Ameritrade, E-Trade are two of the best trading websites - if you are a beginner - Robinhood's user interface is very customer friendly.)

(You may choose following link to open a Robinhood account: https://join.robinhood.com/viralp56)

Step 2: Invest 5$ in the following 5 ETF's

• SPY
• QQQ
• IWM
• INDA
• FXI

SPY will cover 500 top companies trading in United States.

QQQ will cover Nasdaq's top 100 companies in United States.  

IWM will cover top 2000 United States companies - many of them are small and mid caps. 

INDA will cover top companies from India (an emerging market)

FXI will cover top companies from China (perhaps the next global leader)

Step 3: 

Set up a recurring payment of 5$ on daily basis in each of the above 5 ETF's (Monday to Friday).

Note: This will ensure you are covered for downturn as well as you are averaging out on uptrend. 

Step 4: 

Enjoy nice 8 to 10% return on an average per year. 

Step 5 (Optional): 

Thank me after 10 years when you have more than 100% Gain on your investment :)

Edit 1: Follow above method at least for your first 10,000$. Once you reach that threshold and wanted to jump in individual stocks, please invest in any of the following three buckets based on your risk tolerance. 

https://viralpatel15.blogspot.com/2022/04/my-favorites-stock-compilation-list.html