Why and how I'm evaluating the Core Portfolio stocks for Q4

You should be re-evaluate (and maybe rebalance) your portfolio .Here I go over the reasons stocks are taken out and which ones are added and suggestions for rebalancing (as well as re-evaluating)

The Daily Stock Pick Core Portfolio Creation

When I started my podcast, I created a “Core Portfolio” for listeners. I would constantly get people new to investing and trading asking, “What stocks should I start with if I’m new”. My advice was and remains simple -

1. What products or services do you use in your daily business or personal life that you feel you can’t live without?

2. From there, let’s look at the fundamentals and see which stocks are good companies with good profits who have good products and good management.

   The key is to find companies that have solid long term growth who may have periods of pullbacks where it creates buying opportunities.

3. Create a mix of companies in different sectors where some have growth, some have dividends and some holdings are even ETF’s.

I initially put the stocks I either hold in my personal portfolio or have been watching in

TrendSpider

so anyone with a Trendspider subscription could scan for good entry points or trade them with my algorithm.

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I then moved the Core Portfolio to Savvy Trader. This allows anyone for FREE to see the Core Portfolio in real time. It’s an equal weighted portfolio so I simply buy 100 shares of each stock I add. If you haven’t signed up for Savvy Trader - it’s free and I always suggest journaling your trades and this allows you to do that FOR FREE.

I’m re evaluating - you should rebalance too

While I’m changing the stocks in the portfolio here, I think you should do this as well as rebalancing your portfolio. While AAPL is 50% of my portfolio, I should have been rebalancing much more of this over the years. I’m not great at managing my portfolio based on exposure and always tend to be in the thought of “It’s Apple - what could go wrong long term”?

I won’t do as good a job as explaining why YOU should rebalance as this article does - the GOAT INVESTOPEDIA.

The reason I’m not rebalancing the Core Portfolio here is because it’s equal weighted - just 100 stocks of each stock. That’s why COST is the largest position - it’s the highest share price at the time of purchase.

The selection process

A key point in my decision was getting Seeking Alpha and being able to identify weaknesses in stocks. A great example was KO vs. VOO. I was asked in the private Facebook group about buying KO because it’s SO boring. I also know it’s part of Warren Buffet’s core portfolio because he drinks Diet Coke. But when I charted it for 10 years on Seeking Alpha and changed the metric to TOTAL RETURN - it’s clear it’s been a laggard to VOO.

Let’s be honest - if VOO or a 3 fund portfolio (which you can find plenty of suggestions on) is going to beat you choosing 20-30 stocks and holding, the Chill and VOO method is just easier. Google it - it’s an actual strategy.

And Seeking Alpha has an algorithm they call the “Quant Rating”. I’ve posted below the stocks that rate high from top down on the Quant Rating.

It doesn’t automatically mean these stocks stay in the Core Portfolio, but you’ll see a SA Analyst rating and a Wall Street rating. Between all 3 of these and research I can make an educated guess as to which stocks I want to own vs. those I don’t.

Below is paid content and I’ll go through more of the process, but rest assured - Trendspider is part of this process as well. My system and tools are constantly changing, but for me technical trading and charting will always be part of my system as well as the fundamentals.

More of the process explained