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:
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:
- 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 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.
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?
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 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.
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?
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
- 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…
Join the 10s who have signed up already!
Subscribing will improve your life in incredible ways*.
*Only if your life is pretty bad to begin with.