Looking for the Next Big Winners

Ten years ago, I didn't expect Netflix or Amazon to be the big winners that they are today.  If I had bought and held, we'd have significantly more in our are retirement savings accounts.

So I thought I would try to identify companies today that may be big winners 10-20 years from now.  My hypothesis is that small/mid capitalization companies that use tech to better serve a convenience oriented, home oriented consumer will have the  potential to be big winners.   

My initial picks that meet the criteria are:  StitchFix (SFIX), Shopify (SHOP), Grub (GRUB), Baozun (BZUN), IQIYI (IQ), and Twitter (TWTR).

I have also chosen stocks of companies that provide the technology:  Zuora (ZUO), Square (SQ)

My dark horse pick is Kroger (KR).

At this point, it is unclear which or whether any of these will become big winners.    In fact, some of these companies may become unsuccessful.   So I have bought all of them, with the hope that one will be come a star.

I will also continue to look to buy additional stock in companies that meet my criteria.

Disclosure: At the time of posting, we own shares of StitchFix, Shopify, Grub, Baozun, IQIYI, Twitter, Zuora, Square, and Kroger.

For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial nor investing advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Articles Predicting Further Gains for the Stock Market

Here are two interesting articles from CNBC and Marketwatch on why the S&P is likely to be up from now at the end of the year.

https://www.cnbc.com/2018/07/31/the-sp-is-doing-something-it-hasnt-done-since-eisenhower-presidency.html

https://www.marketwatch.com/story/the-fate-of-the-stock-market-for-2018-could-rest-on-the-next-5-trading-days-2018-07-24

The indicator has been right 100% of the time since 1935.  Of  course, past performance does not guarantee future performance.  But I'm betting this year doesn't break the streak.

For more on  Ideas You Can Use, check back every Tuesday for a new segment.

This is not financial nor investing  advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Sticking to the Investment Plan

Staying invested since the end of January 2018 has been tough.   The correction was longer than average, there was a lot of geopolitical concerns, and there were growing legal issues for the Trump administration.  During that time, the market was a roller coaster, with seemingly more dips that rises.   It was hard, but I bought cautiously during the dips, even when the market kept going lower.

Now that the correction is officially over (as of last Friday), all the anxiety and commitment has paid off.  We've increased our investments in equities by around 25%.  Most of the increase was adding to current positions, but I did initiate some new positions.     With the recovery, most of the purchases now have positive gains.  A few, like TWTR and IQ, are still below my average purchase price.  However, I do expect these to recover in the next few months.

My forecast for the S&P index is that is will be up 10% from Friday's close before 2019.  My plan, at this time, is to maintain about the same level of investment through the end of the year.

Disclosure:  We own share of TWTR and IQ at the time of posting.

For more on Strategies and Plans, check back every Tuesday for a new segment.

This is not financial nor investment advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

College Savings Plan Adjustment

Our College 529 Plan made two adjustments for 2018.

First, the amount that can be deducted from income has been increased from $2000 to $4000 per year for each beneficiary.   We can take a state tax for contributions up to $4000.    So we will be increasing our contribution from $2000 to $4000 for each beneficiary. 

Second, per federal and our state regulations, College 529 Plan funds can be used for expenses in K-12.   Since we paid over $3000 in tuition for full day kindergarten in public school, I am considering using the 529 plan funds to cover this cost.

Some argue that it is inefficient to use 529 funds for K-12 since there is a reduction of funds for college.  To address this issue, I plan to pay the funds to the student (beneficiary), who can then invest the funds.  The growth in these funds will be tax free since the beneficiary is a minor dependent and can earn up to $900 per year with no taxes.

Of course, funds in the child's name will reduce financial aid packages, but we expect to receive very little needs based aid at this time.

For more on Crossing Generations, check back every Thursday for a new segment.

This is not financial, investment or eductation advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Mildly Optimistic

It's had to be optimistic about the stock market with all the negativity swirling about.   However, that's probably the time to tough it out and stay invested.   

I have mixed feelings.   I believe the market will be significantly higher by year end, no matter what the outcome of the midterms.  If the Democrats win, the market will go up; if the Republicans winn, the market will go up.  But I believe August will be a volatile month, perhaps even being a down month.

It is a bifurcated stock market, with a lot of rotation.  Some stocks are going up, while others are going down, resulting in a slight rise in the indices.

So I will take some profits in advancing stocks (which means they will probably advance further:-)   And I will buy some short term beaten down stocks, e.g. Chinese internet stocks, biotechs.   I expect that the stock market may be a bit of a roller coaster, and be prepared for slow rises and quick drops.

For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial or investment advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Free Medical School Tuition

NYU, a top ten medical school is offering free tuition to all its students beginning this year.   That will eliminate a significant financial burdens.  Students' only cost will be room and board, which is a normal cost of living.

For more details, see this CNN article.

This is great news for those interested in becoming a doctor.    If this were an choice when I was graduating, I would have given the option strong consideration.

For more on  Crossing Generations , check back every Thursday for a new segment.

This is not financial nor education advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Betting With American Exceptionalism

"Don't bet against the U.S." ~ my late father-in-law

In 2009, my late father-in-law commented that he was staying in U.S. stocks because he believed the U.S. would do well recovering from the Great Recession.  He was right.   Today, I still think his point of view is still valid.   The U.S. will do well because of the exceptionalism of its individuals.   I will continue to stay invested in the U.S. economy and the companies, despite all the naysayers.

For more on The Practice of Personal Finance, check back every Wednesday  for a new segment.

This is not financial or investment advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Scaling Into a Trending Up Market

Over the next few weeks, I plan to scale in the remaining additional funds into our different investment strategies.   Since the end of January 2018, I've been scaling into the dip.   In most cases, this has been a profitable approach.   Although I started purchases at higher levels, I have also made several purchases, hopefully, near the bottom.   In many cases, the short term bottom has already happened.  In a small percentage of stocks/strategies, the price/valuation is still finding the bottom.

At this point, I believe the correction is over and the market may soon cross new highs.  Rather than wait for the next correction, I plan to invest the remaining funds as the market advances.   However, I will do this by scaling in (buying small lots over time), just in case the market pulls back before making its next advance.

For more on Strategies and Plans Ideas, check back every Monday for a new segment.

This is not financial or investment advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Stock Market Breakdown ... Or Breakout?

It's been a little over 6 months since the most recent correction began in January '18. I know some still believe the market is in correction and will test the previous lows and may even breakdown.  However, with the market only about 3% below previous highs the recent correction possibly ended in March '18. 

Since the average time for a correction to reach a new high is 4 months (which is the end of July '18), I'm thinking there is also a good possibility of a breakout.  In my opinion, the market is more likely to advance over 3% than decline 8% in the next few weeks.   

.Breakdown or breakout?  I planning on a breakout.

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This is not financial or investment advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC

Why This Bull Market Can Continue

"The reports of my death are greatly exaggerated." ~ Mark Twain

Recently, there have been an increase of articles cautioning the end of the bull market.   The reasons are numerous:  the longevity, PEs, increasing interest rates, narrowing breadth, geopolitical uncertainty, and, of course, Donald Trump, whose actions extends the list of specific concerns further.

It is a great list of concerns.   However, I think the opposing view, that the bull market can continue, has merit also.

• This is the slowest post WWII economic recovery.  One would have expected a steep recovery given the depth of the recession.  However, the slow recovery may be delaying a future recession since business have not yet over invested and created excess capacity.
• Businesses are still cautious.   Most businesses seem to be still under investing and cutting costs, especially the industrial ones.   No one seems expect an economic boom. 
• Still a great deal of pessimism.  Almost everyone I know thinks this bull market is unsustainable will end.  And there has been a increase in people predicting the onset of a bear market since the election of Donald Trump.  Bull market die when there is excessive optimism and irrational exuberance, neither of which are evident at this time.
• Finally, it is questionable whether this bull market started in March 2009 (bottom of bear market), March 2013 (crossed previous high), or Feb 2016, (the latest major correction).  So this bull market may not be that long in the tooth.

My sense is that this market is still intact, but may be vulnerable to a significant external event.  But until then, this bull market can continue.

For more on  Reflections and Musings, check back every  Saturday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2018 Achievement Catalyst, LLC