Last year I tried an experiment, take 5000 imaginary dollars and invest them in a collection of stocks that I believed would perform well in the following year. I discussed my results here, to recap I took a beating in the first half of the year and rallied in the second half. All in all I would give me 2013 performance a D+. A terrible grade, but on the upside I have plenty of room for improvement and I plan to take what I learned from last year and build on it this year.
What do I think 2014 will bring? It is always best to start with the big picture. As far as the stock market went 2013 was a gangbusters year, but the economy and the stock market are not one and the same. Over 1/2 of all home sales in this country are bought with cash and nearly 100 million Americans are not in the work force. This suggests to me that the rich are, as is often the case, doing very well. The rest of us are struggling and cautious. Some people are suggesting that 2014 will be the year that the economy begins roaring forward, others suggest that the next recession is right around the corner if we even left the last one.
I think 2014 will begin strong, but I see a lot of negatives that could pop up down the road. I think that energy prices should rise, home prices should fall, and while many stocks are overvalued quality stocks will continue to perform well. With this in mind here are the four stocks that I have selected for the 2014 “PiggyBankBuilder” portfolio. This time I again choose 4 stocks that I will fictitiously invest $1250 into each.
- Market Vectors Oil Services ETF (OIH) – Purchase Price – $47.98, number of shares 26. Last year I tried to pick and individual stock that would benefit from an increase in the price of oil, I failed. This time I am picking a fund that tracks the industry, a much safer decision.
- Cablevision (CVC) – Purchase price – $17.96, number of shares 68. This regional cable provider was a winner for me last year and I don’t see any reason why it won’t continue to perform well.
- Microsoft (MSFT) – Purchase price $37.47, number of 33. I have written about Mr. Softie in great detail. I believe that the selection of new CEO will go a long way in unlocking a huge amount of hidden value from this stock.
- iShares Silver Trust (SLV) – Purchase Price $18.92, number of shares 66. Last year I was super wrong about the price of silver. This year I don’t really see it falling much further. Of course I could be wrong, but the upside is greater than the down side.
Some old picks, some new, this time I feel like this portfolio will benefit from last years mistakes and bring a healthy yield in the upcoming year. Fingers crossed.
*Please not that I am not and investment advisor.Please consult your investment advisors before making any financial decisions that could result in loss.