My main goal is to build a portfolio of $1,000,000 in 1500 days, starting from 1/1/2013. Every month, I provide an update on my status. My goal for 2013 was to get my portfolio up to $672,750, from a starting point of $586,043. I accomplished this last month and then raised my goal to $727,750 to account for the money I made selling our last home that I plowed back into the portfolio. Time to look back on the month of July.
July was the best month for me ever. My portfolio jumped from $685,926 to $752,915 for a gain of $67,089. I contributed $2,000, so my holdings appreciated by $65,089. I still don’t believe it. I ran through the numbers a couple of times to make sure it all checks out and it does.
Here are the details (as of 7/31):
- Days elapsed: 211
- Days remaining: 1289
- 2013 gains: $166,872 (including my contributions)
- Left to go (2013): Goal accomplished!
My Dirty Little Secret
How on earth did my portfolio do this? I have a secret that I’ve been very, very hesitant to talk much about. I sell Amway. Just kidding.
Here is the real scoop. While I think index funds should be the core of any stock portfolio, I also invest a little bit of money straight up in stocks. I don’t recommend this, but I have my reasons. That is a topic for another post.
My stock purchases are very few and even farther in between. In an average year, I may buy one or two stocks. Sometimes, I’ll think about a company for a couple years before investing. Once I buy, I rarely sell. I’m a buy and hold guy. I don’t mess around with options or anything like that either. Keep it simple.
Through a combination of dumb luck (buying Google at IPO) and spending many waking hours churning things in my head (ask Mrs. 1500 about how my brain is in a cloud many of my waking hours: “Huh, what?”), I’ve been a pretty good stock picker. My individual stocks have outperformed the rest of my portfolio. Again, this is a topic for another day when I’ll disclose all of my holdings and why I bought them.
The stocks* that kicked my portfolio in high gear were Apple and Facebook. Most of my Apple shares were purchased in January 2007 (when Jobs announced the iPhone) for somewhere around $90. The average share price I paid for Facebook was $29. As of this writing (7/31), Apple is at $452 and Facebook sits at about $37. Both had a huge month.
Other Random Thoughts
- If my gains hold, this will be the second year in a row where I make more money from investments than my job.
- While Apple helped me a lot this month, it has actually been a big drag on my portfolio this year. It is still down over $50 from where it started 2013.
- I didn’t really expect my stock portfolio to come on strong until the last quarter of the calendar year. I’m pretty optimistic about the rest of 2013, despite any action from the fed.
- Most importantly, while I’m thrilled with my performance this month, it really doesn’t mean much at all. There will always be ups and downs. Long-term performance is what really matters, not short-term gyrations. Check back in 2015 and again in 2020 and 2025. If I’m still earning great returns, be impressed then.
*I am NOT a professional investor. Don’t take any of this to be advice. Do your own research and make your own decisions.
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