This is Part 2 of a series of posts that I’m writing to share my process for selecting and investing in growth stocks. Part 1 was just a short introduction. In this post, I’ll focus on how I find growth stocks to analyze. I’m looking for stocks that I believe will outperform the market. On…
The only reason to invest in individual stocks is to beat the average, which I’ll define as the S&P 500 index. Otherwise, the index can be bought without having to expend a single ounce of thought and effort. Anybody reading this post is most likely interested in beating the average, and, as I wrote about…
I prefer to write portfolio updates after some of my portfolio companies have reported quarterly results, and this may not coincide with the end of a month. So far this earnings season, LSPD, PTON, DDOG, and NET have reported their results. I plan to write my next portfolio update at the end of March, after…
Have you ever delayed selling a stock because you wanted to wait until that stock’s price climbed back up to your purchase price? If so, you’re probably incurring a cost: opportunity cost is forgoing the next best investment. Sometimes that next best investment can be better than the one that you still own. For example,…
You may have heard the phrase “The House Always Wins.” It refers to casino games that are designed so that the casino (a.k.a. “the house”) always turns a profit at the expense of its patrons. It comes down to simple math: the casino games are designed so that the odds are in favor of the…
PREVIOUS RELEVANT POSTS My journey to financial freedom Financial freedom: how to get it The math behind getting financial freedom WHY INVEST IN STOCKS If you read the last post referenced above then you have seen how important the percentage growth rate is to growing your nest egg. Small percentage differences over a long period…
PATH TO FINANCIAL FREEDOM Achieving financial freedom means passively generating enough income so that you may spend your time as you wish rather than to support your lifestyle by working, which is really trading your time for money. If the goal is to produce passive income, you will need assets, which Robert Kiyosaki described so…
YEAR RETURN CUMULATIVERETURN 2017 +61.6% +61.6% 2018 +55.9% +152.0% 2019 +41.8% +257.3% 2020 +245.6% +1134.7% 2021* +3.1% +1173.0% *YTD through 31Jan all returns are pretax 2020 was such a spectacular year that it will be a very hard act to follow. While the early 2021 returns for the GauchoRico portfolio and the overall stock market…
A very concentrated growth stock portfolio can provide superior returns compared to the returns from other types of portfolios. However, since each company constitutes a large percentage of the portfolio’s value, a steep drop in one of the portfolio’s components can be harmful. Therefore, I believe that it’s imperative to possess a depth of knowledge…
GameStop (GME) is not a growth stock, and it’s not a company in which I would ever invest. Everyone who’s into stocks has heard about GME by now, and it’s gotten much of the attention this week. The Company GME is a retailer of video games. With video game sales going mostly online, this brick…