My main goal is to build a portfolio of $1,000,000 in 1500 days with no debt*, starting from 1/1/2013. Every month, I provide an update on my status. My goal for 2015 was to get my portfolio up to $874,353. Because we saw exceptional returns in 2013 and 2014, I have already accomplished this. Let’s have a look at July.
One trillion is a huge, strange looking number:
1,000,000,000,000
I had to triple-check the amount of zeros to make sure I had it correct. I just don’t write out numbers this big with any regularity. More on 1 trillion in a moment.
July Performance Update
July was a fantastic month for the 1500 portfolio. I started the month out at $999,668 and ended at $1,044,913, for gain of about $45,000. At one point, I was up to $1,070,000, but couldn’t hold it.
My great month was due to some of my stock holdings. Mr. Market loved Google’s earnings and it’s new CFO. The stock went up about $100/share. It also dragged another one of my big holdings, Facebook, up with it. Amazon was similarly spectacular, also rising about $100/share. Mr. Market was NOT happy with Apple’s earnings (Are people buying the watch or aren’t they?) and that is why I couldn’t hold $1,070,000.
Please know that I recommend none of these companies. It’s not that I don’t like the companies, but I rarely buy individual stocks any more, so these holdings are a relic left over from my younger days. Do your own research and be careful about taking anyone’s advice, especially from a weird, random dude on the Internet.
Here are the numbers as of 7/31/2015:
2015
- Days elapsed: 212
- Days remaining:153
- 2015 gains: $57,362 ($27,375 of this is from 401k contributions)
- Left to go (2015 only): Goal accomplished!
Since the start (1/1/2013)
- Days elapsed: 941
- Days remaining: 559
- Gains since 1/1/2013: $458,870
- Needed for $1,000,000 (investments and cash only): I’m there!
- Needed to retire ($1,120,000 in investments): $75,087
- Net worth***: $1,294,913
One Trillion and Beyond
The market capitalization of a stock is the value of all outstanding shares. No company has ever had a market cap of one trillion, but I believe that some have a shot doing it before the decade is out. Here is a slightly dated list from Wikipedia of the current top 10:
The three companies that I think have a shot at a trillion dollar market cap before 2020 are:
- Apple (691 billion, P/E: 14)
- Google (428 billion, P/E: 29)
- Facebook (263 billion, P/E 91)
Apple (691b)
Apple is only (!) 300 billion away from a trillion, but by no means are they a shoe-in to win the race. The overwhelming majority of their profits come from the iPhone, a product that wasn’t even around 10 years ago (!). Some may say that having all of your fortunes tied to one product in a rapidly maturing market is a precarious position.
Apple is currently firing on all cylinders, but it doesn’t take much for the engine to seize up. Nokia anyone? Blackberry??
However, crazy rumors still give me hope that Apple isn’t adverse to taking chances on highly speculative and expensive projects. Have you heard of the Apple Car?
To hit a trillion, I believe that Apple needs another hit product. I also believe that the watch isn’t it.
Google (428b)
Remember when Google was just a search engine? Now, the company has embedded itself into the fabric of our lives with products like Gmail, Google Maps, Android and YouTube. Have you heard about Google’s new cell network?
However, it’s the really crazy chances that intrigues me. Autonomous cars? Awesome! Contact lenses with microchips? Wow. Read more about Google’s skunkworks here.
As cool and great as these projects are, some may question the business sense in pursuing such moon-shots. I think that Google is going to be OK though. He who controls information…
Facebook (263b)
Facebook is a distant 3rd behind Apple and Google, but don’t underestimate CEO Mark Zuckerberg. Most people know Facebook as the social network. However, the company is also betting big in many other areas. I believe that 2016 will be the year that virtual reality finds its audience, led by Oculus Rift which is owned by Facebook. Have you seen Facebook’s new drone for beaming down Internet access?
Facebook is pouring money into itself to fund all of these initiatives and Mr. Market was not happy. However, Mr. Market thinks in terms of minutes and days. I think in decades. For a long term investor, it’s great that Facebook is investing so heavily in itself. I believe the long term future of the company is bright. Get the products right and the money will follow.
Your thoughts?
Are you crazy like me? Do you spend precious waking hours thinking about trillion dollar companies? If so, I’d love to hear your thoughts.
Do you think Apple, Google or Facebook will do it? It not, who? And when?
Your actions
Remember that this is just a thought exercise. I’m a computer programmer who thinks about money more than I should. Don’t take my advice. Off the top of my head, the only people in the world that I would take money advice from without giving it a second thought are John Bogle, Charlie Munger and Warren Buffett. I’m sorry, but if you are not one of them, I’ll have to think on it a bit and get back to you.
*I still owe something like $120,000 on my mortgage. Because I have a low rate, I firmly believe in not paying it off. My compromise is to have enough money put away to pay off the mortgage at time of retirement. So, to retire today, I would need about $1,120,000.
**This is an affiliate link. If you sign up, the blog makes a little bit of money. Personal Capital is a totally free and superior way to keep watch over your investments. It’s worth it for the fee analyzer alone. I would never recommend anything that I don’t personally use and completely believe in, so give it a try. If you’ve already signed up through the link, please know that I can think of absolutely nothing clever to write here this month. Move on, nothing more to see.
***The numbers on the right side of the page only reflect my investments and cash. Net worth includes, but is not limited to:
- Home equity
- Cars
- Bicycles
- Playhouse! We’re building an epic playhouse at the 1500 household! I’m a dad and there are a lot of things that I want my girls to know about. I call them the Four B’s:
- Buffett: Teach your children about money! Do it. Now. Never too early to start.
- Books: Perhaps my most valuable trait (besides my stunning looks and quick wit) is a love for reading and an unquenchable passion for knowledge. I am trying like hell to instill the same passion in my children.
- Bikes: Until someone invents that crap from Star Trek (“Beam me up Scotty!”), there is no better way to get around
- Building: In many ways, I’m a relic from an earlier time. If something in our home breaks, I start tearing into it, even if I know nothing about it. If I’m unsuccessful in fixing it, which I rarely am, I still learn something. This attitude seems uncommon. Even though the knowledge of the world is now a Google query away, most people just don’t like getting their hands dirty. I don’t want my girls to be like this. They will help me change the brakes on the car. They will help me fix the computers. To get them started, we are building a playhouse together. Like many things in life, I tend to go overboard. This one will have a roof that opens up with hydraulics, lighting, a climbing wall and a zip-line. We just started the project on Saturday, so it doesn’t look like much yet. Just wait though. More soon…
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Great update! And I’m always on board with a playhouse. I helped my dad build one in my backyard and spent hours inside.
My kids better spend hours inside after all of the time we’ve put into it…
I don’t really think about companies, I also hate Facebook. I just try to deal, it’s only getting bigger. That said I could really use another internet option, that Facebook drone internet could possibly replace my overpriced crappy DSL. I’m with you on not paying off the mortgage if your APR is tiny. Always happy to find another fellow carpenter. $350 for something that will last 10+ years and give many great memories. That’s a great investment.
Kyle recently posted…Camping Trip
Ha, there is no shortage of facebook hate. They do cool things with technology though, from their APIs all the way up to crazy ass initiatives like VR. The future will be interesting.
Talking about 1T$ companies, we would almost forget you reached the 1M$.
Congrats on that, this is amazing!
I agree that those 3 companies are hot and still have a lot of potential growth, but I doubt that either Google or Facebook have a chance to reach the 1T$ (if at all possible) before Apple.
In their latest filing, Apple had almost 200B$ cash. They could almost buy out FB with all that.
For sure the next 5 years will be interesting and the battle for the leading ecosystem is not finished…
TheMoneyMine recently posted…Pledge to my Future Self : 3 steps I am taking to not screw you over
“For sure the next 5 years will be interesting and the battle for the leading ecosystem is not finished…”
A sticky ecosystem will likely determine the winner. Perhaps there can be multiple winners though? I don’t see either Apple or Google going away any time soon.
I’d also bet that Apple will reach 1 trillion first. However, for the very long term, I’d bet on Google.
A roof that opens up with hydraulics?!? Now I want you to come down here and build ME a playhouse! =)
I wondered what kind of roller coaster you’d be on this month as I heard the market news about Google and Apple come out within days of one another. Glad it turned out on the upside!
Mrs. PoP recently posted…PoP Income Statement – July 2015
Look up “electric linear actuator.” I don’t think the one I use will be hydraulic, but it will still be awesome.
“Now I want you to come down here and build ME a playhouse!”
From those cabinets you built, I think you could build one 100x more awesome than mine.
Stupid stocks. Can’t wait to be out of that game.
Welcome back to the double comma club, nicely done! Love the playhouse for the kids. I had a tree house as a kid, many adventures had.
Brian @DebtDiscipline recently posted…Net Worth Update: July 2015
I’m always happy to be in the DC Club, but I think that it will probably be a couple years until I’m in it for good…
Great month Mr. 1500. Playhouse sounds like it’s going to be kick-ass. Obviously, I think Apple has the best chance to get there first. But crazy the user base Facebook has. I heard that it’s basically 10x the size of Twitter in that category which is nuts to me. Another one that could get there perhaps is Amazon. Never underestimate Bezos.
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Yeah, fb’s user base is crazy. Its growth is slowing down, but they’ve hardly turned the screws on monetization efforts.
Bezos/Amazon is amazing. That guy is a stellar leader and visionary (Drone delivery!!!!). Completely agree never to underestimate him.
I’m on board with you on Apple and Google, don’t think that Facebook is going to make it though. Ah well, time will tell I guess.
As for bikes, we are catching up fast on our lack of cycling from our Canada days. It is by far the best way to get around (even when you need a raincoat!).
Very curious about the final design of the playhouse though, love it that the kids are helping out. Good luck.
Mr. FSF recently posted…Investment Strategies – Our View and Future Portfolio
Facebook is a curious case. Like Google, it started out doing one thing, but is rapidly evolving.
Bikes are great. I can’t wait to throw an electric motor on one of mine to make it even better.
I have a post coming up about the playhouse. Stay tuned…
I love reading your updates. It’s incredibly motivating to me. The playhouse is awesome! Your girls will remember it forever!
Mrs. Crackin’ the Whip recently posted…So who in the hell is Mrs. Crackin’?
I hope they remember it for all of the right reasons (not the splinters)…
Playhouse sounds like it’ll be awesome for the kiddos. When it comes to Facebook I’m not sure whether it makes sense to invest in this stock or not. I do sense a bit of Google in Facebook as Facebook has expanded into other areas. Need to do a bit more research to figure out whether Facebook makes sense for the long hold or not.
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All three of those stocks are speculative with facebook being the biggest gamble. If I had to only own one, it would be Google.
We should call it 1500 zeros…
Love the idea of a playhouse with a zipline. The kids will love that. I am not nearly as handy, but do like DIYing as much as I can. This week, I forayed into something I have no real experience with: upgrading Mrs. DB40’s computer. We put in RAM (easy) and then I cloned her hard drive and swapped it with a bigger one. Was very worried as I’d never done that before, but in the end, it wasn’t that hard. Like you said: knowledge is one google search away. (Or, maybe more like 25 google searches…)
Done by Forty recently posted…The Miracle of the Commons
Ha, that computer stuff isn’t much easier than building a playhouse or plumbing a real house. Take your time, read some book and watch some YouTube videos. It will all be good.
If the girls don’t like the tree house then you’ve got that rental property you’ve been wanting 🙂
I don’t think about trillion dollar companies unless they are featured in Harvard Business Review Cases, and even then, I don’t think about their valuations. I think valuations are the least interesting thing in the world. This is why I probably can’t become a certified financial planner.
YES! Our real estate market is one of the best in the country, so maybe I could get away with it?!? In San Francisco, it would definitely be possible!
I’m the opposite in that I love market caps and valuations. The bigger, the better. Come on, let’s see a trillion dollar company!!
Great work on your contributions as well!
We just ordered the parts (not lumber) we need to build Daughter Person her own playhouse/swingset. We will begin building sometime in September, when the weather cools down (and I’ve verified we don’t need a building permit for it). I expect she’ll be helping to a certain extent as well (She’s only 4, still has trouble with the hammer and her fingers…)
Mom @ Three is Plenty recently posted…Credit Security Freezes – and why you might want to consider one
Ow wow, working in this heat has been misery. I can’t stand it.
We called our building office and they said anything 120 square feet or over requires a permit. Ours will be 118.
Agreed: hammer + 4 year old fingers = bad things!
So will the playhouse have a talking Buffett statue out front to great the kids? Book shelves……or map to get to the library? Bike racks? and side work bench with a chest full of tools to Build?
Probably just a play house, but I wonder?
Even Steven recently posted…Financial Independence Interview-Fervent Finance
Dude, I should hire you to be a design consultant! I must find a way to incorporate something from Buffett. I think I have it. Seriously, thanks for the inspiration!
I just ask to see the pictures as my consultant fee:)
Even Steven recently posted…What I Learned from a Week of Biking to Work
Great month, man. Yah, between the Google and Netflix reports, and then a few days later when Apple took a bath, my net worth was hitting all time highs, as well. Ah well, the market giveth and the market taketh away.
No plans to redistribute some of those tech shares into index funds?
Eric
Retire29 recently posted…Retire29’s Guide To Crushing Your Next Job Interview
Netflix is insane!
“No plans to redistribute some of those tech shares into index funds?”
This is exactly what I plan to do, but post retirement to minimize taxes.
Congrats on hitting $1MM it’s is a serious achievement. You also managed to get there in wrote a short time. Did you do a breakdown of what was your contribution and what was growth?
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I don’t have the numbers, but almost all of it was growth (>90%) because I was putting money into a house remodel.
Congrats on crossing $1M threshold (again). It looks like your investments fared better than mine in July 🙂
Thanks Steve! I wish every month was a July.
I have been sticking with ETFs. Less volatility and less downsides. This past few weeks were brutal for AAPL.
I am looking forward to your building project completion. I too, like to tear into things and fix them.
No Nonsense Landlord recently posted…Should I Pay Off My Rental Mortgage?
“Buffett” I read this as buffet. Why am I hungry at 9 in the morning?
I’m in the middle bucket. I do more than the average Joe around the house but I also don’t do as much as you. I also just bought our house last July and we rented prior to that.
So in the long run, I want my daughters to be able to do the minimal things (oil change, change a tire, re-wire a light) but not feel guilty about paying a little extra for someone else to do it.
I also worry that they’ll have no interest in any of these things and don’t want to force feed them. But then if I don’t, will they even want to? Ah, parenting. What a crap shoot.
Chris @ Flipping A Dollar recently posted…July 2015 “Profits” – Sales Slowdown
This is how I feel!
http://www.smbc-comics.com/index.php?id=3659
I love the thought of thinking in decades and not days and minutes. I always get frustrated with companies that think in terms of the latest quarter or the investor that freaks on the results from one 90 day period. It’s why I like to think a bit like a contrarian and take some calculated risks (American Airlines, Bank of America, and American International Group to name a few) as Mr. Market always behaves irrationally. I’m waiting until the first rate hike because I think it will likely decimate the REIT sector as the sky is falling mentality will take hold. If that’s the case I’m planning on having a bucks to take on some shares of some well established aristocrats from it.
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You and your projects! I don’t know how you find the time to work, run your blog, spend time with your family and do as much as you do on the house.
I guess that is why I still haven’t started on our bathroom or redoing the door frames in the condo.
When the play house is done, can we come up for an adult play in the play house? We will bring a six pack or two. 😉
PS. Congrats on getting back over the $1mm hump. The last few months has been a ride in the market.
David of the Debt Free Guys recently posted…The 1, 2, 3s of Emergency Savings Plans
Great progress on your investment portfolio! Looking forward to seeing the playhouse come together as well, that’s a pretty ambitious plan. I think you’re putting the rest of us dads to shame… 🙂
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