In January 2018, an investor on r/investing – a discussion board for stock market enthusiasts with over 2.8 million members – shared his success story and investing journey. The investor, who said he was 50 years old, started with about $20,000 in college debt and made about $21,000 in the first year after college.
“I opened my first brokerage account with $2,000 in Ameritrade in 1997, thinking I was going to jump on the internet bubble. I bought and sold weekly and rode that baby down. I basically never made any money and when the whole thing crashed, my $2,000 literally got down to $37. So many internet stocks just evaporated.”
However, he did not lose hope and kept returning to the market, making some changes to his investing approach:
“I pretty much focus on mutual funds now after getting my a** handed to me on individual stocks a few times. The few I have left are ‘sentimental.'”
The investor said “pretty much all” of his portfolio resulted from him putting small amounts of money into the market via 401(k) and IRAs. He lived below his means to save up:
“I bought cheap used cars when I was under 25 but then bought a new car and drove it for 20 years,” he added.
He shared screenshots of his portfolio showing holdings and each position’s worth. His portfolio’s total worth reached just over $1 million as of his post. He shared his investing strategy:
“I pretty much buy and just let it sit. Last time I sold anything was about three years ago when I last rebalanced. I held all through the 2009 recession and lost about 60%. I’ve always invested pretty aggressively, so I got hit hard when it went down, but I’ve recovered well as it’s gone up.”
A key lesson from the investor: never try to time the market and be patient.
“I’ve never tried to time the market before, so the last six months isn’t going to change that. I will likely start shifting to more conservative investments at some point, but I’ll probably always have 75%+ in equities.”
Based on publicly shared portfolio screenshots, let’s examine some of the investor’s biggest holdings.
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The Emerald Growth Fund
The Emerald Growth Fund Class C (HSPCX) was the biggest holding of the investor, whose portfolio worth reached $1 million. HSPCX focuses on small- and mid-cap growth stocks. Some of the fund’s biggest holdings include FTAI Aviation, Freshpet, Carpenter Technology and Credo Technology, among others. It’s up 26% over the past year. The investor had 7,654 HSPCX shares of the fund in his portfolio, accounting for about 18% of his total investments.
Vanguard 500 Index Fund Investor Shares
The Vanguard 500 Index Fund Investor Shares (VFINX) was the second biggest holding of the investor who self-managed his portfolio for years and reached the $1 million mark. The fund tracks the performance of the S&P 500 Index by investing in large-cap U.S. stocks. The investor had 626 shares of the fund, valued at about $163,311 at that time. During the discussion, someone asked the investor why he was invested in this fund and recommended he swap his position for Vanguard 500 Index Fund Admiral Shares (MUTF: VFIAX). Here is what the investor said:
“That’s a good one and part of the reason I posted the details. Not sure why I missed VFIAX before. It’s available through E-Trade and only has a $10,000 minimum initial investment, so I should have found it unless they just started offering it. Thanks for the tip.”
The Fidelity Select Air Transportation Portfolio
The Fidelity Select Air Transportation Portfolio exposes investors to airlines, airport services and related companies. The investor, who reached a $1 million portfolio, had 1,139 fund shares. Air Transport Services Group, United Parcel Service, RTX and Delta are among the fund’s biggest holdings.
Fidelity Select Industrials Portfolio
The Fidelity Industrials Portfolio (MUTF: FCYIX) invests in construction, aerospace, engineering, machinery and manufacturing firms. Over the past year, FCYIX has risen a whopping 47%. The investor had 2,618 shares of the fund in his portfolio, valued at $101,243 at the time of his post five years ago.
Hennessy Focus Fund Investor Class
Hennessy Focus Fund Investor Class (MUTF: HFCSX) is known for its concentrated portfolio focusing on high-quality businesses with growth potential. The fund invests in high-conviction companies for five to 10 years or longer. As of Nov. 8, the fund’s portfolio has 23 stocks. The biggest holdings include AST SpaceMobil, Brookfield Corp., Ashtead Group, O’Reilly Automotive and American Tower. The investor had 1,074 shares of the fund in his portfolio.
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William Blair Small-Mid Cap Growth Fund
The William Blair Small-Mid Cap Growth Fund Class N (MUTF: WSMNX) invests in small- and mid-cap growth stocks. The investor, who reached a $1 million stock portfolio, had 3,357 shares of the fund in his portfolio, valued at $87,063 at that time. Over the past five years, the fund has grown 55%.
The James Balanced: Golden Rainbow Fund
The James Balanced: Golden Rainbow Fund Institutional Class (MUTF: GLRIX) invests in stocks, fixed income, cash and ETFs, aiming to maintain a balance in its portfolio. The fund is up 9% over the past five years.
Microsoft
Microsoft (NASDAQ:MSFT) was also part of the investor’s portfolio. At the time of sharing his post, he held 250 shares of the company, which was worth $22,975. Over the past year, the stock has increased 14%.
Alibaba
The 50-year-old investor who hit $1 million in his stock portfolio had 100 shares of Alibaba Group (NYSE:BABA) in his portfolio. Over the past five years, the stock has been down 50%.
Meta Platforms
The investor who hit the $1 million stock portfolio milestone had 100 shares of Meta Platforms Inc. (NASDAQ:META), now Meta Platforms. The stock has risen about 208% over the past five years.
T. Rowe Price Latin America Fund
T. Rowe Price Latin America Fund (MUTF: PRLAX) gives investors exposure to Latin American stocks. PRLAX is down about 12% so far this year. It has shown volatile performance amid the region’s market situation and currency fluctuations. Itau Unibanco Holding, Petroleo Brasileiro, Vale and Grupo Mexico are among the fund’s biggest holdings.
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This article 50-Year-Old Hits $1 Million in Stock Portfolio, Shares Top 11 Holdings and Tips – ‘I Pretty Much Buy and Just Let It Sit’ originally appeared on Benzinga.com
