M1 Finance Portfolio updates

 Top 50 Stocks: 

1. ABBV
2. ALKS
3. ALLY
4. AMGN
5. ATKR
6. AVGO
7. BABA
8. BAC
9. BKNG
10. BLDR
11. BMBL
12. CACC
13. CELH
14. CNC
15. COP
16. CTVA
17. DAL
18. DOX
19. EA
20. EPAM
21. FB
22. FBHS
23. GRMN
24. HOLX
25. HON
26. HSIC
27. JOBY
28. LHX
29. LLY
30. LRCX
31. LYB
32. MIDD
33. MOH
34. MS
35. OLN
36. ON
37. PARA
38. PINS
39. REGN
40. ROL
41. SBUX
42. SHW
43. SLB
44. T
45. TECK
46. TMUS
47. UPS
48. V
49. WAL
50. ZIM

Trend Portfolio 50 Stocks: 

1. AJRD
2. AMCR
3. AMD
4. BIDU
5. BKI
6. BL
7. BLKB
8. C
9. CFG
10. CPB
11. CVI
12. ENPH
13. FDX
14. FICO
15. FUTU
16. FWONA
17. GLD
18. GLPI
19. GRFS
20. GTLS
21. JD
22. JNJ
23. LSPD
24. MDT
25. MGA
26. MPC
27. MRVI
28. NLOK
29. NTES
30. OXY
31. PATH
32. POOL
33. PRGS
34. PTC
35. PUBM
36. RKT
37. RUN
38. SAGE
39. SEDG
40. SKX
41. SNPS
42. SOFI
43. SQM
44. STE
45. TMO
46. VIR
47. VRTX
48. VTRS
49. WEX
50. WM

Favorites Stock Portfolio 50 Stocks:

1. AAPL
2. ABNB
3. AMZN
4. ASAN
5. AXP
6. BA
7. BILL
8. BYD
9. CMG
10. COST
11. CPE
12. CRL
13. CROX
14. CRWD
15. CVNA
16. DASH
17. DBX
18. DIS
19. DKNG
20. DPZ
21. ETSY
22. EXPE
23. FND
24. HUBS
25. HZNP
26. IQV
27. LULU
28. MAR
29. MDB
30. MELI
31. NFLX
32. NIO
33. NVDA
34. OKTA
35. PTON
36. ROKU
37. SE
38. SHOP
39. SPOT
40. SQ
41. TOST
42. TSCO
43. TSLA
44. TTWO
45. UBER
46. ULTA
47. UPST
48. VEEV
49. Z
50. ZION

Risky 100 Stocks: 

1. ABC
2. ABT
3. ADP
4. AI
5. ALRM
6. APD
7. AVTR
8. BC
9. BDX
10. BIIB
11. BUD
12. BZUN
13. CCJ
14. CDNS
15. CGC
16. CNXC
17. COMM
18. CRON
19. CTXS
20. CVS
21. DFS
22. DKS
23. DNUT
24. DOW
25. DWAC
26. EMN
27. ERJ
28. EXFY
29. FANG
30. FL
31. FLT
32. FOUR
33. GD
34. GDRX
35. GLW
36. GPC
37. GRIN
38. HIMX
39. HLT
40. HPQ
41. HWM
42. IBM
43. INTC
44. J
45. KHC
46. KNTE
47. LDOS
48. LILM
49. LITE
50. LMT
51. MCHP
52. MGNI
53. MHK
54. MMM
55. MPWR
56. MQ
57. MRO
58. MU
59. MVIS
60. MX
61. NAVI
62. NET
63. NKE
64. NKTX
65. NOC
66. OPEN
67. PCAR
68. PCOM
69. PEP
70. PII
71. PKI
72. PLUG
73. QGEN
74. RACE
75. RADI
76. RF
77. RH
78. RS
79. S
80. SAM
81. SAVA
82. SCI
83. SGEN
84. SKY
85. SLM
86. SNX
87. STX
88. STZ
89. TAK
90. TAP
91. TJX
92. TPR
93. TSN
94. UDMY
95. UI
96. YOU
97. YUM
98. ZEN
99. COF
100. FVRR

Following stocks are now not part of any of the portfolio: 

1. BYND
2. FTCH
3. LMND
4. MNDY
5. PLBY
6. RDFN
7. VRM
8. SFIX
9. SKLZ
10. UPWK
11. WISH
12. ZM
13. COIN
14. INMD
15. INTU
16. JCI
17. RBLX
18. U
19. APPS
20. DDD
21. DELL
22. EXPI
23. FOX
24. HUT
25. IAC
26. IRBT
27. LPL
28. PVH
29. SHAK
30. SNOW
31. TECH
32. XPEV
33. TWLO
34. AFRM
35. AMBA
36. BBBY
37. BBY
38. BEAM
39. CHGG
40. CHPT
41. CPRI
42. CRM
43. CSIQ
44. DDOG
45. WBD
46. DLO
47. DOCS
48. EDIT
49. FCEL
50. HOOD
51. LNC
52. LOVE
53. LYFT
54. MARA
55. MRNA
56. MRVL
57. MTCH
58. MTTR
59. NOW
60. NTAP
61. PACB
62. PENN
63. PLTR
64. PYPL
65. SIVB
66. SIX
67. SPCE
68. TDC
69. TTD
70. URI
71. WSO
72. WYNN
73. ZBRA
74. ZI
75. ZTS
76. AKAM
77. ALK
78. CAT
79. CHD
80. CINF
81. CYBR
82. DLTR
83. EW
84. FTNT
85. GOLD
86. JNPR
87. MT
88. ORLY
89. PANW
90. PAYX
91. RTX
92. SEAS
93. TENB
94. TGT
95. ASO
96. ATI
97. BBWI
98. BG
99. BOX
100. BURL
101. CHKP
102. DE
103. EEFT
104. HCP
105. INVH
106. JAZZ
107. JWN
108. LZ
109. MOS
110. MTDR
111. NBR
112. NTR
113. PWR
114. QLYS
115. RARE
116. RPD
117. SABR
118. SPLK
119. UHS
120. VRNS
121. ZIP
122. BROS
123. CCL
124. CHWY
125. ADM
126. AGCO
127. ANET
128. ARE
129. BJ
130. BMY
131. BOOT
132. CAH
133. CF
134. CFLT
135. CTAS
136. DOCU
137. DXCM
138. ESTC
139. EXAS
140. FIVE
141. FIVN
142. FROG
143. FSLY
144. GDDY
145. GME
146. GTLB
147. H
148. HII
149. ISRG
150. KR
151. LAZR
152. LYV
153. MKC
154. MSTR
155. NCR
156. NWL
157. ONON
158. PAGS
159. PFGC
160. PLAY
161. PLTK
162. PSTG
163. QS
164. SMAR
165. SNAP
166. SRPT
167. TDOC
168. TDY
169. TLRY
170. TNDM
171. TV
172. TWTR
173. VIRT
174. VMW
175. VRSK
176. WOLF
177. WOOF
178. WWD
179. ZS
180. IQ
181. OPT

CAR LEASE FORMULA

 To determine you have got the good lease deal or not, use following formula. 

--> (Real Monthly Payment / MSRP) * 10000 < 125 --> Good Lease

--> (Real Monthly Payment / MSRP) * 10000 = 100 to 105 --> Excellent Lease

Real Monthly Payment = Monthly Payment + (Down Payment / 36 months lease) 

*Down payment includes tax and registration etc) 

For BMW Lease in 2017, I paid 4000$ down payment and my monthly payment was 403$, so my real monthly payment = 403 + 111 = 514 $

Applying above formula : 514 / 48400 (MSRP) * 10000 = 106.19

SQ or PYPL - Which one is better longer term?

Short Answer: PYPL 

Long Answer: 

Although SQ and PYPL are in the credit services business, fundamentally, they are different. PYPL has more concentration on "Online" transactions while "SQ" would prefer people to go offline from internet and rely on small businesses. 

SQ has been put under the bracket of "Software - Infrastructure" as it provides necessary infrastructure for small business to collect money from customers. 

But if we compare their valuation, revenue and profit - it shows completely different picture. 

Paypal is valued as of now as 90 Billion dollar company - slightly rich in PE as their profit is 3.5 Billion but forward PE comes out to be roughly 15 (which is more than reasonable PE). 3.5*20 = 70 Billion is roughly a good valuation for Paypal on current income, however, with the growth it is posting on year on year basis - 90 Billion (today's valuation) is reasonable. 

Paypal's 2017 Revenue was 13 Billion and 2022 Revenue was 26 Billion. They roughly doubled their revenue in 5 years and that is phenomenal growth. (20% on year on year basis). Same is true for their income. Now, there is a fear in market that many of these "online" companies saw their TOP during COVID and their growth will slow down. In my opinion, for Paypal, that will not be the case. Dollar is at high and transfer of money will remain consistent even if people go out and spend money elsewhere. There are no indications yet that their growth will slow down, Plus they have started credit card business to help with their growth scheme. 

SQ on the other hand had phenomenal 2021 year and perhaps it could be due to Crypto Boom. Their income though is shrinking year after year. From 0.88 EPS in 2019 to 0.36 EPS in 2021. SQ is valued at 41 Billion and they dont make money even in billions - its more like 166 Million. 

Both of them could be good investment, but if given a choice, I would prefer PYPL (because of the #'s that they have). Growing Revenue and Growing Profit and reasonable valuation. SQ can also outperform but that remain to be seen, it needs to be reflected in their balance sheet. 

RONALD READ ROBINHOOD PORTFOLIO

There are bunch of ways to create and manage stock portfolios but the one which is guaranteed to make money in the long run is a simple advice of "Buy and Hold it" for long term. Long term could be 10, 20, 30 years or more. One of the example that has been given multiple times are about AAPL (Apple) stock. If you bought Apple shares in 1982 and kept it for 20 years and wanted to sell them in 2002 - you would have lost more than 10% money in it. However, same apple stocks if you bought in 2002 and hold it for 2022 (next twenty years), you would have had millions of dollars in profit. (10,000$ worth of Apple stocks bought in 2002 now worth more than 5 million in 2022). So, it is difficult to determine which 20 years belong to that stock, but there is no denying the fact that Stock Market will give you the greatest return of all time - provided you are disciplined enough to hold those stocks forever. 

Please read through: https://en.wikipedia.org/wiki/Ronald_Read_(philanthropist) about Ronald Read and how he created mind blowing amount of wealth for himself by investing in good company stocks. I am building one of my Robinhood stock portfolio with the similar intent. "Buy and Hold" it forever. 

I buy stocks in that portfolio on daily and weekly basis. First method in this madness is following my own advice on buying 25$ worth of stocks on daily basis in five major ETF's as described in this blog: https://viralpatel15.blogspot.com/2021/03/stock-market-beginner-advice.html

Apart from that there there are recurring buy set up in some of my favorite stocks. Some of them are listed in this blog: https://viralpatel15.blogspot.com/2022/04/my-favorites-stock-compilation-list.html ; There are more than that - but majority of stocks listed in that blog,  I buy 2$ worth of each stock on daily basis. Some of them not listed - there is a recurring buy of 3$ per week and so on. 

Apart from that, I buy 5$ worth of each stock that I pick on weekly basis. I pick 20 stocks each week and I buy 5$ worth of each stock listed plus I pick 5 stocks out of that for long term and I buy 10$ extra in it. For eg: This week's picks are: https://twitter.com/viralpatel15/status/1523393048604209152

Apart from that, I also buy some stocks on the weekly basis based on their weekly performance. Theory behind this is that "Winners will keep on winning" - So, I buy 2$ worth of top 3 stocks from Mega Cap, 4$ worth of each top 3 stock from Large Cap, 6$ worth of each stock in Mid Cap, 8$ worth of each stock from small cap and 10$ worth of each stock in Micro Cap. For eg: last week's picks are: https://twitter.com/viralpatel15/status/1523003771030499329

Last but not the least, similar way, I buy small portion on daily basis. That is: 1$ in top 3 mega cap stocks, 2$ in each top 3 large cap stocks and so on. For Eg: https://twitter.com/viralpatel15/status/1522670928915836929

Besides all this, while scanning through some of the stocks during trading hours, if I do find a stock at a good correction level, I buy them randomly for 5$. 

Although - it may seem like a lot - it is within the boundary mentioned in my overall financial blog - which means, at any given point of time, I make sure that my total exposure to stock market does not exceed more than 20% of total value. Details are here: https://viralpatel15.blogspot.com/2022/01/ideal-allocation-of-money.html

P.S: These are details of my just one portfolio. I manage other portfolio's in M1 Finance for different reasons (majority of them are for trading purposes and I change those portfolio's on monthly basis) and there is another one in e-Trade -which I also use for trading purposes. There are other small portfolio's for growth stocks allocation, trading options etc. 

Fed raised interest rate by another 50 basis point

Fed chairman Jerome Powell announced today that they are increasing fed interest rate by another 50 basis point. Stock market went up by 2% - as direction was clear for next two fed meetings. Fed indicated that in June and July meetings they will be raising rate by 50 basis point. Powell also indicated that next two month's data - better or worse will most likely not impact their judgement of 50 basis point hike. 

In my opinion though, if inflation numbers continue to climb and increase by over 9% in year over year basis for April and May data - we may see 75 basis point hike talks back. Powell may not do 75 basis point hike in June, but there are high chances that he may have to do 75 basis point hike for July. 

25, 50, 50 and 75 would put us around 2% interest rate by end of July and then Fed will be data dependent. There are very high chances that April CPI Data will be higher than anticipated increase. It could be as high as 9.2% when we compare year over year increase. Please see below table which describes consumer price index data month over month since last decade. 

Inflation has always risen but it went from overall 2% increase on annual basis to 4.69% increase in 2021. Fed initially thought that it will be "Transitory" but later data indicated otherwise. Inflation is most likely going to stay high for next couple of months at least but peak some time in Summer 2022. That does not mean inflation will come down drastically however it does mean it will flat it out at the top. When we start comparing data from 2022 to 2023 - it will not grow to such high numbers such as 8% or 10% but it will return to normal growth of 2 to 3%. 

Fed expects that inflation will return to 2% but in my opinion it will take a lot longer time and perhaps Summer of 2023 might be realistic target. That means - there is more pain ahead for high growth stocks and we are probably not even half way there. Generally, Bear market does not last that long but inflation will make sure it lasts for full 18 months and Summer of 2023 will be a great buying opportunity for many of beaten down tech stocks. 

This does not mean that other stocks will not perform well for next one year. Energy stocks are still not owned by majority of big investors, specially alternate energy, solar energy stocks. Financial stocks are going to do well, in rising rate environment, specially regional banks, plus companies which are paying high dividends and have good balance sheet will continue to rise.