Pareto Portfolio Update
Significant returns can be made even holding a small number of stocks. Avigilon is up 43% since December 24, 2014. 80/20 investing isn’t for everyone, but it is for those like me who believe that less is more. Choose a few great companies, watch your portfolio like a hawk, and you’ll do well. I first wrote about the Pareto Portfolio on December 26, 2014. My belief is that an investor does not need to have a large number of stocks in his/her portfolio in order to have significant market beating returns. In fact, I believe that having less stocks in my portfolio will help me to invest and make returns far better than many other investors based on the 80/20 principle. My portfolio is much easier to follow and control and this makes my life easier. To date, you’ll see how the portfolio has performed since December 24th. I also have some updates on selling, purchasing and dividends/interest received within the portfolio. Stock Shares Price at 2014/12/24 Price at 2015/02/13 Change Avigilon Corp. (OTCPK: AIOCF ) 290 17.25C 24.67C +43% Cisco (NASDAQ: CSCO ) 125 32.89C 36.64C +11.4% Coach(NYSE: COH ) 100 42.9791C 49.61C +15% Dream Office REIT ( OTC:DRETF ) (T.D/UN) 811 24.76C 27.13C +9.5% Pembina Pipeline (NYSE: PBA ) 90 41.58C 40.39C -2.9% The portfolio has performed extremely well, led by Avigilon Corporation, which has gained 43% since its close on December 24th of last year. Following are the changes I made in the portfolio between then and February 13th. Sold all 100 shares of Coach on 2015/01/12 @ 45.3856C. In addition to the 33.38C in Coach dividends received on 2014/12/29, the total gain was 6%. Purchased 106 more units of Dream Office REIT on 2015/01/16 @ 26.72. Dream Office REIT Interest on 2015/01/20 of 130.66C, of which 129.14C of this was automatically reinvested through Dream’s DRIP for an addition of 5 units to my total, which now sits at 811 units. Pembina Pipeline dividend on 2015/01/16 of 13.05C. This was not reinvested. Cisco dividend on 2015/01/21 of 24.95C. This was not reinvested. I sold Coach on the news that the company was going to purchase Stuart Weitzman. I’m not convinced that purchasing this company with its cash is the best idea. So far, the stock price movement has proven me wrong. Time will tell. Cisco released its FQ2 results last Wednesday and beat analysts’ expectations. A number of analysts have increased their price targets due to the forward guidance by the company. I’m very comfortable to continue holding CSCO. The company also increased its dividend by 11%. Avigilon will release its FQ4 and 2014 full-year results after the close of markets on 2015/03/03. I’m expecting great results, as are many who are invested in and/or follow this company. This company is growing extremely fast and doing so profitably. Its cameras and video surveillance system was used to secure this year’s Super Bowl in Phoenix . Pembina Pipeline and Dream Office REIT continue to perform very well, and analysts have significantly higher price targets than the shares are trading at presently. Both also offer nice yields of 4.3% and 8.2%, respectively. If you’re going to invest using the 80/20 style, you need to make good choices, focus on just a few companies, and then watch your portfolio like a hawk. Don’t be afraid to take profits nor be afraid to sell if you think you have a valid reason to do so. I don’t believe you need 30, 40, or 50 stocks to significantly outperform the market. I believe that less is more. Have a great week everyone! Disclosure: The author is long AIOCF, CSCO, PBA. (More…) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article. Additional disclosure: I am also long T.D.UN (Dream Office REIT)