Safe Haven Monthly Update

A review of our Safe Hanfen portfolio.

Looking back to earlier this year when we created this portfolio, we now realise the name Safe Haven might have been a little ambitious. There has been no safe hideout during this bear market, except maybe energy stocks, but these are highly cyclical and do not fit our investment style. This should not discourage other investors to stay away from these stocks but we like to stay in our relative circle of competence and always be wary of value traps. 

Another option is probably to keep your cash in cash, the dollar has been mighty strong and at least you don't have to look at the bloodbath every day. Seeing your portfolio down 20, 30 or even 50% does take its emotional toll and if you instead choose to leave your dollars in a savings account it will at least only go up, thanks to the generous 1% interest rates the banks are offering you. You might be thinking in South Africa we can get much higher rates like 8%. That sounds great but if you take a holistic view of the value of each rand you save after you compensate for inflation and currency devaluation you are still fighting a losing battle.

So what choice do we have? Each individual must really take their time and think about this. There are many paths to financial freedom, unfortunately just as many to poverty. We chose to invest from an early age even though we are fully aware of the massive risk involved, we couldn't bear the risk of not investing. 

Back to our Safe Haven portfolio, where our prospectus was to choose 10 indestructible companies that will almost guarantee their existence for the next decade and help you SWAN (Sleep Well At Night) during this volatile period. Well, it is 5 months later and all 10 companies are still breathing, so far so good. Jokes aside, these companies have shown their relative strength and are generally less volatile than the stocks in our more risky portfolios.

There is a valid argument to rather own an index fund compared to these 10 companies and we don't really have a strong counter against this. In fact, we also recommend it, if you don't have a strong passion for stocks, research and the financial markets in general you should stay away from picking individual stocks. These portfolios also don't represent the author's personal portfolio although many stocks do overlap. We started the Unicorn Portfolio, Core Fund, Biotech Longshots, ETFs and Safe Haven to show potential investors how to build different portfolios from scratch. These ideas can be used for inspiration to build your own portfolio depending on your risk tolerance and time horizon.

Portfolio Update Summary

We are adding to all ten positions in our Safe Haven portfolio while the market is giving us the opportunity to acquire these long-term compounders at attractive valuations.

• Buy $200 HD at $280.73
• Buy $200 SBUX at $84.08
• Buy $200 AAPL at $138.02
• Buy $200 PG at $126.90
• Buy $200 RACE at $184.09
• Buy $200 BRK.B at $267.85
• Buy $200 DIS at $94.74
• Buy $200 TXN at $156.66
• Buy $200 MO at $40.84
• Buy $200 LMT at $391.19

Disclosure

This article is not financial advice and is based on the author's opinion.  This article is not a research report and is not intended to serve as the basis for any investment decision. All investments involve risk and the past performance of a security or financial product does not guarantee future returns. Investors have to conduct their own research before completing any transaction. There is always the risk of losing parts or all of your money when you invest in securities or other financial products. The $10K in the Safe Haven is not real money and only a demonstration of a typical portfolio.