Let's quickly close 2020 so we can put it behind us as fast as possible. We had 12 of the 14 grandkids participate, and we did pretty darn well as a group. I think we kicked this off in April, which means we had nine months of performance to track. We turned $14,000 into $21,506. That's a healthy 54% return. The S&P 500 returned 41% over the same time period, which means we 'beat' the market. Needless to say, this year was bonkers, so don't expect these returns every year. Typical annual average return on stocks is 9.5%. I think Poppy would be very proud of us. If there's any takeaway here for a beginner, I hope that it is it is both possible and not very hard to make money in the stock market. Anyone can turn $1000 into $1500 (or even $3000) in less than one year with some logical thinking and luck.
Poppy's Picks & Updates
Poppy advice: Don't hold too many stocks or investment positions. As Peter Lynch once said, "Know what you own and why you own it."
It's easy to buy into many things, let time pass, and then lose touch with what you own. This happens especially when anytime you have a few thousand dollars, you look to invest in a new stock. Instead of buying yet another new stock, to keep things simple, it may make sense to add more money to your existing stock holdings or buy into an index fund or ETF. Poppy told me that I should share this as we were looking over his portfolio of 40+ positions, which he says are far too many. Personally, I've given myself a maximum of 10 individual stocks, so that I don't fall into this trap. Uncle Joey P has a max of only 4 or 5 holdings. It is definitely easier to follow the news and performance of your stocks when there are fewer of them.
No trades this month, but Lindsay's QuantumScape battery tech company had a crazy month. She bought it at the end of Nov, and it has already doubled in value to over $2,000. At one point, it was over $3,000. Very volatile!
- Brenna, and Milena are still sitting on their $1000 in cash.
Please remember to update the google sheet detail tab when you buy/sell something. I look at the revision history each month so I can include your trade in this newsletter. The summary tab is at the bottom of this email as a picture and the live link to it is here.