Thread by @RamBhupatiraju

Stocks I slowly bought over the past month (not recs). All of these are adds to existing positions. No new pos initiated (unlike previous downturns).

$ROKU : $246
$MTCH : $136
$PYPL : $181
$FVRR : $148
$UPST : $173
$TDOC : $101
$DOCU : $132
$NVCR : $82
$PINS : $38
$DDOG : $159

I'm definitely glad that my older/bigger positions in $AAPL $GOOG $AMZN $BRK $NKE $ISRG $SBUX $CMG etc. are acting as shock absorbers these past few weeks to the drawdowns in growth names.

With that said, let's dive in. ⬇️

It's not about how much up/down I'm from my previous purchases on the growth names (mostly done in 2019-21), or the drawdowns from 52wk highs. For me, it's more about where I think these could be in 3-5 yrs.

I'm NOT trying to predict which names are going to be

in favor for the next few months, buy them & flip soon after. For a majority of my portfolio, I'm trying to slowly buy pieces of Cos that interest me, think are high quality and believe are going to be much more relevant and bigger in the future.

The capital for these purchases usually comes from new cash, previous sales sold for a gain (as investment objective is met), previous sales sold at loss (when I'm no longer interested, thesis broken, weaker conviction..)

Few simple Qs I keep asking myself before taking action during volatile times.

1⃣ Am I interested in researching and following this Company and Industry for the next few years? Is it in a strong and durable growth trend?

2⃣ Does this Company have a good competitive positioning within that industry, good Management, good financial (for the life cycle and investment stage of that co) and operating metrics?

3⃣ Does this position hold/improve the quality of the Portfolio and diversify it well (to an extent)?

4⃣ Under reasonable assumptions for future scenarios, does the current price offer me a good R/R to initiate a position or add to existing one.

✔️I'm not trying to guess & nail the bottom. Just slowly deploying capital into what I currently believe are good Cos (within my current interest zone and circle of competence) for the next 3-5 years at what I think are sensible prices for normal operating and Market conditions.

✔️I don't really care what all these stocks are called in the short-term : COVID beneficiaries, Fallen Angels, broken stocks ....

✔️What I care about is if they are strong companies, with Management pursuing the right opportunities and whose intrinsic value could be much higher 5 years down the road if they execute well.

✔️Yes, I'll be wrong in some of these positions w.r.t quality, execution or estimate of intrinsic value, but I'll let the actual business results and a normal Market environment prove me wrong, not temporary Market/Valuation drawdowns due to Macro fears.

✔️I also usually rotate between Cos and sectors for the buys : SaaS, E-commerce, Fintech, Medical Devices, Consumer, Big Tech, Industrials other quality Co.s I'm familiar with...

This drawdown however isn't wide like COVID crash or 4Q'18. So fewer choices compared to normal.

✔️I'm also trying to come out of this phase with a more concentrated Portfolio than before along with some weightage changes that reflect my current interest/conviction levels and perception of R/R.

Things I AVOID
-Hindsight bias
-Wishful thinking
-Trying to predict the Macro and its specific impact/timing on Markets
-Making BIG Portfolio levels changes to move in and out of stocks

-Buying or Selling too much in a short time period
-Letting external opinions impact my Portfolio actions
-Commenting on what others should be doing with their own money

✔️Temperamentally and process wise, if I'm not inclined to move completely in and out of stocks, the best I can do is
-stay CALM
-get rid of any lower conviction names
-buying/adding slowly into my fav names
-consolidating and concentrating

Note that all of this differs hugely based on the individual, their goals, short term cash needs, risk tolerance, strategies and competencies.

The reactions and subsequent actions could vary a lot between

A Money Manager trying to showcase YTD performance

An individual investor concentrating on certain sectors and building positions over time

A person who is close to retirement and needs to be conservative

A new investor who has never experienced a Bear market or isn't rooted in investing concepts

A trader relying on Market signals to time entries and exits

There's no right or wrong answer that universally applies to every one for any given situation.

Know yourself first, read widely, learn from some, but always make your own decision and take actions that are aligned to your long-term goals and best interests.

All the best in navigating whatever the Market (and Fed) throws our way. 👍

/END