The goal of the Weekly Market Update is to give you some insights on the stock market, some visibility on my portfolio, and how I make decisions.
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Graph of the week
In 2020 many investors where focused on the NASDAQ 100 (QQQ). QQQ includes the 100 largest non-financial companies listed on the Nasdaq based on market cap. It has well outperformed the S&P500 in 2020 (see graph below)
Tech companies were more resilient to the Covid crisis. S&P500 finished the year at almost 20% gain. While QQQ scored almost a 50% gain.
CQQQ is about the same but for China. How does it perform? Well... also about the same as QQQ in 2020. But 2021 seems to be another story:
CQQQ already registered almost 20% gain in 2021. While QQQ "only" grew by 5%. And I think it's going to continue.
In 2021 my bet is that many investors will switch focus to the Chinese market. There are many reasons for that:
- China seems to better handle the crisis (and the virus)
- Chinese stocks are getting more and more exposure to international investors
- The changing world order: China will be our next global leader.
CQQQ allows me to reduce my exposure to the Western World while investing in companies resilient to the current Covid crisis.
My current aim is two fold:
- Reducing my exposure to some assets I don't believe in anymore, or that are not aligned with my vision
- Reduce my exposure to the U.S market & increase my exposure to the Chinese market
I closed many positions last week:
As you can see:
- I closed my positions in HYG and JNK
- I reduced my exposure to assets that are not fully aligned with my strategy: Oil (USO), real estate (WELL), Palantir (PLTR) and Facebook (FB).
I also invested 8% of my portfolio in CQQQ.
What I will be focused on from now on:
- Keep reducing my exposure on the U.S. market
- Have a better view of my portfolio. Which sectors? Which markets? I want to be able to rebalance effectively at least every quarter
- Have the major portion of my portfolio invested in ETFs
- Use a small portion of my portfolio (10%) to make small (and risky) bets on individual stocks.
- Increase my exposure to renewable energy and green-tech