I was a victim of burglary

If you’ve been reading my recent blog posts, you’re probably already aware that I recently made a quick trip to the San Francisco Bay Area. Considering I am temporarily staying in the residential quarters of the Tempo company facility, I had a convenient non-stop flight available via Southwest Airlines from Long Beach Airport up to Oakland International Airport.

Upon arrival, I picked up my rental pickup truck—a 2021 Toyota Tacoma—and enjoyed my week-long visit.

 
I am probably one of the most anti-California people you’ll ever meet. I hate California and almost everything about it. For example…

Much of California’s newest legislation is counterproductive for the people, serving more to make political statements than to help the state’s residents. Cal­i­for­nia claims to help the disadvantaged and marginalized population, but statistics show that is not the truth. California’s legislators have a long track record of being unable to learn from history—both their own and that of other states’—and constantly make easily-avoidable mistakes. California’s state a­gen­cies make it increasingly difficult for businesses to operate effectively and efficiently, thus creating limits to innovation and advancement. Cal­ifornia’s taxes are ridiculously high, but their gov­ern­ment services are cripplingly incompetent compared to other states’.

As you can imagine, that list only scratches the surface of my issues with California. The only reasons I even continue to maintain any relations with Cal­i­for­nia at all are because Tempo is a California corporation (though that may be changing soon) and I have a decent number of friends and family mem­bers who choose to call California their home.

Branching off my prior point of California using their policies for politics, California’s cities are absolutely infested with crime right now due to its “soft on crime” attitude in response to the recent social activism surrounding police and racism. Because of this, I frequently preach about the importance of per­son­al safety in California, especially in Greater Los Angeles and the San Francisco Bay Area. The police there do not have the same kind of staffing as de­part­ments in the suburbs or in other states, and they often do not have the resources to respond in a timely manner to non-life-or-death calls, so you need to protect and look out for your own self.

The San Francisco Bay Area in particular has or­gan­ized crime groups that commit seamless, highly efficient thefts in broad daylight. These thieves use spe­cial­ized equipment integrated directly into their gloves to shatter car windows in less than a second and take valuables from inside. Each squad has their own rotating route on which they memorize which cars are owned by locals so that they can instead target the more vulnerable tourists. Other less or­gan­ized thieves do not discriminate and hit every vehicle in an area. Because of the strain on law enforcement resources, the criminals are becoming in­creas­ing­ly brazen.

Locals have tried to combat this by emptying their vehicles, posting signs on their windows pleading for the thieves not to tamper, leaving their doors un­locked as to disincentivize window break-ins, and sometimes even leaving their trunks and hatchbacks wide open. It sometimes works… and some­times doesn’t.

 
The late morning of the day of my departure, I checked out of my hotel and went to refuel my rental pickup truck so I wouldn’t be charged an e­gre­gious­ly high refueling fee. I was staying at the Courtyard by Marriott Oakland Airport, so I picked a convenient gas station nearby and on the way to the ren­tal car facility—the Shell at 285 Hegenberger Road. I placed my backpack on the front passenger seat, threw my luggage in the back seat, and set off with­out bothering to put the address into my GPS—it was just a u-turn and a few blocks away.

I turned right into the gas station, drove up to a fuel pump, put my rental vehicle in park, and stepped outside. I used my credit card to pay at the pump, authorized the transaction, in­serted the nozzle into my gas tank, and locked the trigger. While fuel was flowing, I started walking a circle around the ren­tal pickup truck to inspect for damage ahead of its return.

I made my way around and behind the pickup truck over to the opposite side and noticed that the front passenger side door was slightly ajar. Confused as to how I managed to drive from the hotel to the gas station without noticing, and wondering why the truck didn’t alert me, I pushed the door securely shut and continued my walkaround.

One second later, I realized what happened.

I peered in through the window and noticed my backpack was gone.

 
I had fallen victim to the organized theft rings in the San Francisco Bay Area, culprits of the very crime that I warn people about all the time.

More as a formality than anything else, I walked into the convenience store after I was done refueling, upon which the clerk and a customer, both of whom had witnessed the crime, said it happened “right under [my] nose.” They said it was over in a matter of seconds while I had my back turned to the truck and was paying for fuel—a white Jeep Compass had driven up, opened the passenger side door, snatched my backpack, and drove away. I always ad­vise people to keep their head on a swivel, but it seems like even that wouldn’t have helped in this situation, considering how quickly and ef­fi­cient­ly the theft was ex­e­cuted.

To make matters worse, I basically telegraphed that I was a tourist, i.e., an easy target. My rental pickup truck had Washington plates, which indicated I was a visitor—if not a rental car, then probably an out-of-state road tripper. On top of that, I noticed that the people in that area were pre­dom­i­nant­ly Black, so being the one and only Asian person functionally announced that I wasn’t familiar with the neighborhood and most likely was not a resident.

However, notwithstanding any of the above, the thieves accessed my passenger side door without breaking the window. So what happened?

After thanking the witnesses for the information, I headed back out to my rental pickup truck and did a bit of testing. I started the engine, placed the truck in drive, ensured all the doors were locked, then reverted it back to park. The instant I shifted to park, all the doors automatically unlocked, pre­sum­a­bly as a convenience feature. When I had exited the vehicle earlier to refuel, I did not manually re-lock all the doors (nor did I realize I even had to).

Considering that this kind of theft happens in this area all the time, and no vehicles or firearms were stolen, I didn’t bother calling the police—it’s not like they will or can do anything in this situation anyway. Instead, I just drove over to the rental car facility to return the pickup truck and ensure I would be at the airport on time as to not miss my flight.

 
So what was the damage?

A Lenovo Legion 7 Series laptop I purchased on sale for ~$1,600 that retails for ~$1,850. A Canon PowerShot G7X Mark II digital camera I pur­chased on a no-warranty discount for ~$550 that normally retails for $629. Two SanDisk Extreme PRO SDXC cards, a 512 GB one in the camera and a 256 GB one for backup, I purchased for a combined ~$150. A custom-designed zirconium pen with titanium damascus hardware I pur­chased for ~$300. A dis­con­tin­ued classic Red Bull Signature Series backpack I received for free from Red Bull but was also available for sale at the time for ~$150. RayCon Eve­ry­day earbuds I purchased on sale for ~$70 which now retails for $90. And some other odds and ends with a cu­mu­la­tive value not exceeding $150.

The total of actual losses, without accounting for retail or resale prices, was ~US$2,820.

 
As sadistic as this may sound, I’m sort of glad this happened. Things could have gone much, much worse, and they didn’t.

First, I’ve learned that this is one of those things where, you can study the criminology, theories, and data all you want, but it’s hard to truly understand it until it’s happened to you. Even as someone who has formerly worked in law enforcement and has seen this happen all the time, it’s definitely a wake-up call and a learning experience when it happens directly to you.

I also only got my backpack stolen, and not my phone or wallet, which were both directly on my person at the time of the theft. If I had gotten either of those stolen, I am fairly certain I would not have been able to make my flight back, or if I did, there would have been many complications. My wallet had my only form of identification. My phone had my electronic boarding pass. I did not know how to navigate to the rental car facility without GPS as­sis­tance. I needed rideshare service to return to the place I’m staying at after I land.

Unrelated to the travel issues, my wallet also contained credit cards with a cumulative credit limit of over US$120k, which I would not have been able to immediately freeze if I didn’t have my phone. Even though I personally would not have been liable for unauthorized purchases, that is still an as­tro­nom­i­cal amount of money for a merchant to lose if someone used my cards and the store handed over the merchandise to the thief.

I also had minimal to no threat to my personal safety. It happened behind my back before I had any opportunity to react, and I had no direct interaction with the thieves (i.e., it was not a robbery). I did not have a deadly weapon brandished at me. That is definitely a relief, because I generally do not carry my firearm with me when I am traveling by plane (due to the extra hassle it takes to properly secure it in a special container and transport it through checked baggage), so if there was a threat to my life, it’s not like I would’ve even been able to fight back and defend myself.

After returning to Long Beach, I went straight to my personal pickup truck and did some testing, upon which I learned that it also had this “convenience feature.” I guess it is convenient for people who travel as a group, but considering that I almost always travel alone, I turned off auto-unlock for all ex­cept the driver’s door.

This means that, during my last 4.5 years of truck ownership and somewhere upwards of 150 refueling sessions, my pickup truck doors had always been left unlocked at the gas station. That’s a little scary to think about, considering that sometimes, when I am hiking or wearing workout shorts that are not compatible with a holster, I will carry my gun in my backpack. I am very fortunate that my backpack did not get stolen during any of those times when my gun was inside, and I am also very fortunate that my gun was not inside in this instance when my backpack did get stolen.

Ultimately, this was a very simple financial loss of ~$2,820 on my end. There were no credit cards stolen that could’ve caused further damage to mer­chants, no firearms stolen that could’ve been used to commit aggravated crimes or take others’ lives, and no personal injury to my own health or well-being. Obviously, $2,820 is quite a bit of money, but I am very fortunate to have a great job where I can maximize the use of my strengths to bring high value to the company and be compensated very well, so it won’t be difficult for me to recover.

 
Upon arriving at the airport, I used my phone to remote log out, change passwords, and deauthorize account and software licenses from my freshly-stolen laptop. Except for the most recent 10 or so pictures, everything else was already backed up from my camera to the cloud, so I didn’t lose any photo mem­o­ries from the trip (as you can see from the restaurant blog posts I already published).

After returning to Long Beach, I filled out an online police report with the Oakland Police Department. This incident happened back on Tuesday, Jan­u­ar­y 24, 2023 a few minutes after noon Pacific time. I filled out a police report around 10:30 PM that same night. It has now been over two weeks and my report still has not been processed, so I still do not have a formal report number.

As you can probably tell from my website, one of my favorite things to do is to capture photographs and share my life with others on my blog, so my cam­er­a was the very first thing I replaced—I purchased a new Sony ZV-1. It is lacking a few convenience features that my old Canon camera had, but the auto-focus is extremely fast and accurate, and it’s nice trying out a new brand to get a broader perspective of the available technology on the market.

I didn’t buy a new laptop, and instead fished out my old Chromebook I bought around 8 or so years ago. It’s slow, but it still works. I can’t play games on it or do advanced photo editing, but I can still check my emails, write blog posts, browse the web, and use cloud apps like Google Docs/Sheets and Mi­cro­soft 365 for Web. Considering how I basically do everything on my desktop computer and barely use my laptop, I figured there’s no rush to buy an­oth­er laptop.

I replaced my lost earbuds with the JBL Tune 125TWS. I use desktop speakers with my computer and literally only ever wear earbuds when I’m on a plane, so I didn’t go too overboard doing research on earbuds before making a purchase—I just picked one that was not too cheap, was in stock, and had quick shipping available.

I don’t care what backpack I use, so I went to the garage of Tempo‘s HQ and grabbed a backpack from a huge pile of old equipment that probably would have gotten thrown out anyway; it is more satisfying to me that I am recycling potential waste, rather than having a nice backpack. I didn’t replace my zirconium pen because that thing was way too heavy anyway and probably would’ve served better as a paperweight than a pen. Everything else I either replaced in-kind (like the SD cards) or did not replace (like my phone charger, because I already have plenty).

 
And with that, I leave you with one actionable step and one piece of advice.

Newer vehicles are all coming with more and more convenience features. I personally don’t like them. For example, I have an old-school pickup truck bed where you need a physical key to get in, and the only way to breach is either to pick the lock or take an angle grinder to the steel cover. This gives me a lot of peace of mind when storing things in my truck bed. On the contrary, newer pickup trucks have electronic tailgates where you can press a button or hot-wire an electronic signal to open them.

If you have a vehicle that was manufactured in the past several years, check your convenience feature settings in the instrument cluster and infotainment system. If you often drive alone, make sure these “features” aren’t leaving you vulnerable to theft.

And finally, don’t get complacent. I, a former member of law enforcement, a former mixed martial arts coach, someone who holds an academic degree with a focus on crime, and someone who is generally highly aware of my surroundings, still fell victim to professional thieves. It’s never good to be so anx­ious and paranoid that you can’t think clearly, but it’s also dangerous to be complacent. Stay humble and alert.

 

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One-year update: Investing US$10k in the stock market – Parkzer vs. DougDoug & Twitch chat

Prerequisite reading: The original “Investing US$10,000 in the stock market – Parkzer vs. DougDoug & Twitch chat” blog post

 
Disclaimer: I am not a registered financial or investment advisor, and even if I was, I wouldn’t be your advisor. To you, I am nothing more than someone on the Internet posting anecdotes via a personal blog on his website. This content is intended for comedic and entertainment purposes only. Everyone’s sit­u­ation is uniquely different, so consult a certified professional if you need guidance on your own financial strategy.

 
Last year, my friend Doug Wreden and I decided to do a fun investing competition where we would both put US$10,000.00 into stocks of individual, publicly-listed companies and find out whose portfolio balance was higher after one calendar year.

Doug livestreamed the stock selection process on his Twitch channel on Friday, January 21, 2022, though it happened after markets closed at 4:00 PM EST / 1:00 PM PST, so the orders went through the morning of Monday, January 24, 2022. I had some prior commitments on the 21st so I wasn’t able to join in on the broadcast, which meant I picked my stocks by myself over the weekend, causing my orders to also go through on the 24th.

Yesterday, Monday, January 23, 2023, was the final trading day of the one-year challenge period. The results are now in.

 

The winner

I know many of you just want to see the results and don’t care about the analysis, so here is what you’re looking for. If you suffer from hexa­kosioi­hexe­kon­ta­hexa­phobia, proceed with caution.

(Apologies to those who are visually impaired and/or use screen readers; the content of those tables and charts is just too large and graphically-intensive to be able to reasonably translate into HTML. Hopefully the summary below helps you get a better idea of the information provided. All further tables on this page are hard-coded into the document.)

With my portfolio’s ending balance at $8,837.11 and Doug’s portfolio’s ending balance at $8,170.45, I am the winner of the competition by a margin of $666.66. Yes, this is real. No, I did not smudge or tweak the numbers to get that result. Feel free to validate all the numbers in the spreadsheet above.

As a reminder, my portfolio was designed not to win harder, but to lose slower (as opposed to Doug’s, which, whether or not he intended it, was de­signed to win harder at the cost of also losing harder). This strategy worked, as the overall markets did not have the best year in 2022.

My portfolio’s winners were NextEra Energy, Inc.; Waste Management, Inc.; and Walmart, Inc. My portfolio’s biggest losers were Digital Realty Trust, Inc. and, funny enough, Amazon.com, Inc. Amazon was my effort to “diversify” by adding in a wildcard company outside of my designated sector strategy (more on this later); if I had just committed to my strategy, my portfolio would have done even better.

On the other hand, Doug’s portfolio’s winners were Costco Wholesale Corp., Coca-Cola Co., and to some extent, PepsiCo, Inc. Doug’s portfolio’s biggest los­ers were Aspen Aerogels, Inc.; Intel Corp.; and Hasbro, Inc. Throughout a majority of the year-long challenge period, Netflix, Inc. was performing hor­ri­bly, but it was starting to pick back up recently; it’s unfortunate that the timing of the stock challenge was such that it didn’t have an opportunity to ful­ly recover.

Both of us lost to all of the benchmarks except for cryptocurrency. If I had invested everything into bonds, I would’ve made $37.50 more; if I had invested everything into the total domestic stock market, I would’ve made $277.84 more; and if I had invested everything into the total international stock market, I would’ve made $322.09 more. I was actually ahead of these benchmarks for a large part of the past year, but they passed me up right at the end. I think this serves as a good demonstration that, if you’re investing for the long haul, it is probably a good idea to just put your money into broad market index funds.

If it’s any consolation, we should be happy that we did not put all our money into cryptocurrency. The Grayscale Digital Large Cap Fund, which is com­posed (as of today) of Bitcoin, Ethereum, Solana, Polygon, and Cardano, fell almost 65% in value.

 

Prophet Adam

It is widely accepted that it is impossible to consistently and intentionally predict the stock market, and those who have managed to do so have just got­ten lucky. However, what isn’t impossible is to take current events into consideration and make broad generalizations about what is more likely to hap­pen in the stock market during that generalization period.

Last year, I made three major assumptions:

  1. The first was a very specific assumption that the COVID-19 pandemic would go through more severe sinusoidal phases that would cause another market crash. This was simply incorrect, as the pandemic seems to have stabilized, the United States has mostly gone back to normal life, and most people have accepted SARS-CoV-2 as being a lingering virus that we will have to deal with long-term, just like how we already deal with the flu.
  2. The second was a broad assumption that the stock market is more likely to fall than it is to rise, due to the fact that the economy is not ac­tu­al­ly as healthy as it might seem. This ended up being correct, inflation is indeed at a decades-long high, and we saw policy changes im­ple­mented by the Fed­er­al Reserve System (such as increased interest rates) to help mitigate.
  3. The third was an assumption that the world will trend towards infrastructural development and the continued transition to push rapidly-evolving tech­nol­o­gy to the general public. As far as I am aware, there is nothing particularly iconic that happened in the past year with regards to this that rev­o­lu­tion­ized the way society works. However, this statement is also so excessively broad that it sounds like, a year ago, I might have worded it in­ten­tion­ally vaguely to make it so it was borderline impossible for my prediction to be wrong.

From there, I decided that, out of the market sectors defined by the Global Industry Classification Standard (GICS), I wanted to focus on consumer sta­ples, health care, utilities, and real estate. Were those indeed the best sectors? Here are the results:

Sector (Ticker*) Start Price Shares Value Cost basis Change ($) Change (%)
Energy (VDE) $ 87.06 $125.43 114.8633 $14,407.31 $10,000 +$4,407.31 +44.07%
Health Care (VHT) $241.11 $247.52  41.4748 $10,265.85 $10,000 +$  265.85 + 2.66%
Utilities (VPU) $149.02 $151.02  67.1051 $10,134.21 $10,000 +$  134.21 + 1.34%
Materials (VAW) $182.44 $182.80  54.8125 $10,019.73 $10,000 +$   19.73 + 0.20%
Industrials (VIS) $192.23 $188.87  52.0210 $ 9,825.21 $10,000 –$  174.79 – 1.75%
Consumer Staples (VDC) $195.83 $188.65  51.0647 $ 9,633.36 $10,000 –$  366.64 – 3.67%
Financials (VFH) $ 94.19 $ 87.05 106.1684 $ 9,241.96 $10,000 –$  758.04 – 7.58%
Total Market (VTI) $222.33 $201.28  44.9782 $ 9,053.21 $10,000 –$  946.79 – 9.47%
Information Technology (VGT) $405.03 $346.23  24.6895 $ 8,548.26 $10,000 –$1,451.74 –14.52%
Real Estate (VNQ) $105.43 $ 88.09  94.8497 $ 8,355.31 $10,000 –$1,644.69 –16.45%
Consumer Discretionary (VCR) $303.61 $240.90  32.9370 $ 7,934.52 $10,000 –$2,065.48 –20.65%
Communication Services (VOX) $124.96 $ 92.82  80.0256 $ 7,427.98 $10,000 –$2,572.02 –25.72%

*For the purposes of this table, I used Vanguard sector ETFs to gauge each sector’s performance. I selected Vanguard simply because I personally use it as my primary brokerage and I am most comfortable working with their offerings. There are many other options available, and the results may vary de­pend­ing on which one you pick.

Energy was a wildcard that spiked from the Russo-Ukrainian War and its escalation as a result of the 2022 Russian invasion of Ukraine. With that ex­clud­ed, it seemed like my predictions were generally correct—although real estate underperformed, the other three sectors I picked outperformed the to­tal stock market, and if I average out all four, I would be ahead of the total stock market by $543.97.

Remember, though, that my ten individual company picks did not beat the total stock market by that amount, or at all. That further emphasizes how much of a risk it can be to invest in individual companies instead of broad indexes, as well as how basing your investment decisions even on something as seemingly reliable as stock market sectors could still end up leading you astray.

 

The Coca-Cola vs. Pepsi mini-game

Doug’s community is split in half into two teams based on the letter with which each person’s Twitch username begins—”A Crew” for the first half of the alphabet and “Z Crew” for the last half of the alphabet. As a mini-game between the two “crews,” Doug invested $500 into Coca-Cola to represent A Crew and $500 into Pepsi to represent Z Crew, and whichever stock ends with a higher balance would determine which crew wins.

Company Coca-Cola Co. PepsiCo, Inc.
Start  $  59.96    $ 175.49  
Price  $  60.23    $ 169.12  
Shares 8.3389 2.8492
Value  $ 502.25    $ 481.85  
Cost basis  $ 500.00    $ 500.00  
Change ($) +$   2.25   –$  18.15  
Change (%) +0.45%  –3.63% 

Unfortunately, Doug made a common mistake of confusing Coca-Cola Bottling Co. Con­sol­i­dat­ed (COKE) with Coca-Cola Co. (KO), so he ended up investing A Crew’s $500 into the wrong company. I flagged this for Doug so he could fix his mistake, but not before he re­al­ized $26.07 in prof­its from COKE from the first trading day. Before I could make the prop­er cal­cu­la­tions to see how much of that gain should carry over, he put the en­tire $526.07 in­to KO.

Thus, the A Crew vs. Z Crew situation becomes a bit more complicated. Instead of just look­ing at Doug’s portfolio to see who won, we have to do some math to find out what his bal­ance of KO would have been had he invested the $500 properly from the beginning.

After performing that calculation using historical data and running a market simulation ag­ing that portfolio by one year, we have A Crew’s Coca-Cola Co. finishing with $502.25 and Z Crew’s PepsiCo, Inc. fin­ish­ing with $481.85, thus making A Crew the winner of the mini-game by a mar­gin of $20.40.

 

The aftermath

One of the stipulations of this challenge was that we would have to donate any earnings beyond our $10,000 cost basis to charity. Unfortunately, both of our portfolios lost money, so there were no profits this time around.

Another stipulation was that the loser of the challenge (i.e., the person with the lower portfolio balance) would have to do a punishment. If I were to lose to Doug and his Twitch chat, it was suggested that I would have to get a phrase of Twitch chat’s choosing laser engraved onto my Glock 19 pistol. I ac­tu­al­ly don’t recall explicitly agreeing to this, but thankfully, it doesn’t matter, because I won.

Doug’s punishment, on the other hand… was undecided. I imagine it is going to be determined through a voting process with Twitch chat during an up­com­ing live stream. I also trust that whatever is selected as his punishment is of comparable severity as me potentially having some random Twitch meme permanently immortalized on my duty weapon.

 
I had fun with this stock investing challenge, and I’m glad I was able to participate. I think many people just expected all along for me to win, but in reality, there were plenty of opportunities for Doug’s portfolio to come out ahead.

I’d be happy to participate in something like this again in the future. But until then? I’m sure you already know… I’m selling everything tomorrow and putting it in the S&P 500.

 

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Eating a whole salmon in bunny costumes with Doug Wreden for charity

On August 26, 2022, my friend Doug Wreden ran a charity fundraising event for the Monterey Bay Aquarium in celebration of Rosa the sea otter‘s birth­day. The US$90,000.00 stretch goal was for Doug and me to eat a whole salmon while wearing bunny suits. The event ended up raising US$104,327.89.

With my stay in the Seattle Metropolitan Area soon coming to an end, we decided now would be a good time to fulfill our promise. Yesterday, we went to a local seafood store looking to purchase a whole salmon.

We asked the fishmonger what the smallest whole salmon would be, and he said it would be around 12 pounds (5-6 kilograms). He went to the back to grab one and came out with a 17.87 pound (8.11 kilogram) salmon, saying it was the smallest one they had available.

We brought it back to Doug’s house and stored it in the refrigerator. It barely fit.

This morning, we extracted the salmon from the refrigerator to prepare it for cooking. We were considering putting it on a tray, but then realized that would be completely pointless.

Here is a picture of Doug next to the salmon, for scale.

We covered the inside of the oven with tin foil and placed the fish inside. It was too big to comfortably fit in the oven, so we turned it diagonally and curved the head and tail upwards so it would fit.

After about an hour, the salmon was more-or-less done cooking, and it had a nice, golden brown crust.

We went into this knowing that it would be completely unrealistic to actually eat the entire fish, but we had our estimates—I thought I would be able to eat about 2 pounds, and if Doug does the same, we’d finish about a quarter of the fish.

Oh, and also, my inflatable bunny suit was aggressively large.

I ended up underestimating ourselves, because we finished about half of the salmon. If we account for the head and tail that we did not consume, as well as the weight of the bone, I think we might have eaten about 3.5-4 pounds (1.5-1.8 kilograms) of salmon each.

This was the aftermath. We took the leftover salmon and stored it in containers to finish consuming another day.

By the end of it, I had eaten so much pro­tein and fat that my stomach was upset and I felt physically exhausted, but I ate some popsicles high in sugar, and that neutralized some of the weird feeling in my stomach and made me feel much more refreshed.

This is by far my favorite stream that I’ve been a part of. Not only was it just an absolutely absurd, ridiculous, and insane concept, but it was tied to a great charity event, the audience was very happy to watch and was looking forward to it for over a month now, and it went surprisingly smoothly from a logistical perspective.

I’m glad I got to participate, and now Doug’s community just needs to convince him to eat a bunny while wearing a salmon costume…

 

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Investment allocation breakdown for 2022 Q2, comprehensive edition

Disclaimer: I am not a registered investment advisor, nor do I have the proper qualifications to become one. The information contained in this blog post is intended to be strictly anecdotal as a means of personal storytelling, and it should not be construed as financial advice. Everyone’s situation is uniquely different, so do not blindly copy my strategy; instead, consult with a certified professional if you have any questions or need proper guidance.

 
After doing these investment breakdowns quarterly for over a year now, and each quarter, building upon the previous quarter’s breakdown, I realized that it’s not very realistic to ask people to go down the entire rabbit hole of all of my past investment allocation breakdowns in order to understand the full context of anything new that I’m sharing. Because of this, I have decided to do a “comprehensive edition” of my investment breakdown at least once a year in order to “reset” the trail of breadcrumbs and provide a new standalone anchor point from which readers can start.

Because of this, this particular comprehensive edition of 2022 Q2’s investment allocation breakdown is going to be a lot more detailed and will contain lots of repeated information from previous posts—which is the entire idea here, as the main point of me doing this is to be able to compact everything im­por­tant into a single article so readers won’t have to navigate back in time.

Now, with that having been just said, I think this may seem pretty silly, but I direct you to a blog post that I published in the past titled “Investing US$10,000.00 in the stock market – Parkzer vs. DougDoug’s Twitch chat.” In that post, I discuss my current outlook on the market; it will give a general explanation as to why I seem to be so focused lately (within the past half a year or so) with portfolio diversification and alternative investment classes.

Cash

I subscribe to many safe-investing principles, including the idea that time in the market is better than timing the market, and how you should always hold minimal cash—only enough to cover your emergency fund. If anything makes you heed my disclaimer above a­bout how I’m not an investment advisor, it should be this—I am at an all-time high in cash holdings, and I am being a hypocrite and not following my own advice.

I didn’t recently sell investments in preparation for making a major purchase or anything—I just don’t feel comfortable dumping a bunch of money into the stock market right now until I see some modicum of stability return to the charts. I am losing a substantial amount of value from my money due to high inflation by just holding it in cash, but that is a trade-off I’m wiling to accept to avoid losing even more to a crashing market.

My bank account of choice is the Discover Online Savings Account. I’ve been a Discover customer ever since I was 18 years old and got my first credit card; Discover has always been reliable for me, and because it is an online bank, even though the interest rate on the savings account is tiny, it is still astronomical compared to traditional brick-and-mortar banks that may offer less than a tenth (or even a hundredth) of a percentage point.

 27.19%

Domestic broad market index funds

For the money that I do still have in the stock market, a large portion of it is in domestic broad market index funds, namely Vanguard To­tal Stock Market Index Fund Admiral Shares (VTSAX) and Vanguard High Dividend Yield Index Fund Admiral Shares (VHYAX).

I use Vanguard as my primary brokerage, but I also have a Fidelity account for account types that Vanguard doesn’t offer—namely a Health Savings Account and a regular brokerage account that supports incoming transactions of over-the-counter securities (which Van­guard recently stopped supporting in late April) (I also hold my 529 College Savings Plan with Fidelity because the sign-up proc­ess was much easier than Vanguard’s). Within my Fidelity HSA, I hold my money in the form of the Fidelity ZERO® Total Market In­dex Fund (FZROX).

Although I’m hesitant in current market conditions, domestic broad market index funds are my favorite category of investment. Each calendar year when limits reset, I max out my tax-advantaged accounts, and all other investments into the stock market generally go into brokerage accounts in the form of broad market index funds.

 17.84%

International total market index funds

For the purpose of diversifying outside of the United States of America, I also own Vanguard To­tal International Stock Index Fund Ad­mi­ral Shares (VTIAX).

I don’t know much about countries outside the United States, and I am probably grossly uneducated about international matters, but I know for a fact that the United States is not the only successful country in the world, and I want to make sure that I have exposure to outside markets in case something horrible happens to the United States and/or something incredible happens to a foreign country.

Beyond that, I don’t really have much further insight here; I just picked out a broad market index fund specifically focusing on non-US companies (as opposed to worldwide index funds) such that I don’t have any overlap with domestic index funds I already own, and can control and proportion my exposure to global markets.

  5.29%

Target date funds

In my retirement accounts, specifically my Roth IRA and SEP-IRA, I like to purchase target-date broad-market index funds. Spe­cif­i­cal­ly, I have my money split fairly evenly between Vanguard Target Re­tire­ment 2055 Fund (VFFVX) and Vanguard Target Re­tire­ment 2060 Fund (VTTSX).

The premise of a target date fund is to pick out a year in the future for when you think you are going to need to start making with­drawals, and the index fund manager automatically adjusts the holdings of the fund to optimize growth up until that point. For ex­am­ple, if you are expecting to retire in 2060, these funds will invest heavily in high-risk, high-return stocks for now, but as it gets closer to 2060, the fund will progressively shift holdings into low-risk, low-return bonds such that your money won’t suddenly plum­met if a stock market crash were to happen close to your retirement year when you need to start making withdrawals.

Due to annual contribution limits set by the government on these tax-advantaged retirement accounts, a majority of my investments are in regular brokerage accounts. Thus, by putting all my tax-advantaged retirement savings into target date funds, I’m only putting a relatively small percentage of my investment into these automatically-adjusting portfolios, and I am manually managing everything else outside of these retirement accounts.

A reasonable question I often get is why I don’t manually self-manage all of my investments (including retirement savings), instead of en­trusting my IRA contributions to Vanguard’s fund manager, considering how involved I already am with investing and wealth man­age­ment. The main reason is so it can act as a safeguard in case something happens to me in the future where I am no longer able to ac­tive­ly manage my own money. Of course, I imagine that the likelihood of that actually happening (and then my caretaker also not being able to actively manage my money) is inconceivably low. However, for my personal risk tolerance, I feel like I already have plen­ty of other investments such that I’m willing to sacrifice a bit of money on an automatically-managed target date fund with a slight­ly higher expense ratio so it acts like a makeshift insurance policy for my retirement, in case the market crashes right when I need the money.

As a side note, I also recently started taking advantage of another tax-advantaged account, the UNIQUE 529 College Investing Plan. I set one up with Fidelity, and again, for the sake of convenience, and because of how small of a fraction of my total portfolio this ac­counts for, I was comfortable just putting the money into a target date fund. Based on the fact that I may use this money myself for further education (as opposed to passing it onto my children), Fidelity selected the NH College Portfolio (Fidelity Index) as my fund.

 20.53%

Real estate investment trusts (REITs)

If you ask people how to best diversify your investment portfolio, the go-to answer from most people is usually going to be real estate. Unfortunately, traditional real estate has a relatively high barrier of entry—not only do you have to go out and find a physical prop­er­ty at a rea­son­a­ble price with good potential for positive cash flow, but you also need to put a chunk of capital down to purchase the property, even if you’re loaning money from a lender.

Luckily, there are some alternatives for real estate investment that don’t involve purchasing an actual building, facility, or plot of land. The real estate investment trust is an investment vehicle that allows you to invest in a company that, to put it simply, acts like a land­lord on your behalf and shares their real estate profits with you. A vast majority of taxable revenue from income-driving activities, such as collecting rent payments from leasees, are distributed to REIT shareholders in the form of dividends.

Because I personally am not at a point where I feel ready to commit to purchasing physical real estate, 100% of my real estate investment exposure is through Vanguard Real Estate Index Fund Admiral Shares (VGSLX).

 11.72%

Bonds

I have been relatively fickle with bond holdings because of how young I am and how much opportunity cost there is to investing in bonds instead of in stocks, considering the amount of runway I have prior to needing to withdraw from my investments. With that being said, upon the full onset of the COVID-19 pandemic and the relief efforts the United States government took to print an absurd amount of money out of nowhere, it was fairly obvious that inflation was going to skyrocket.

This was less well-known before, but I’m glad that this information is much more commonplace now—the United States Department of the Treasury offers a special bond called the Series I Savings Bonds that acts as a hedge against inflation. As of this writing, the in­ter­est rate on these bonds is 9.62%, which is earth-shatteringly high considering that many people are losing double-digit per­cent­ages on their portfolios by investing their money elsewhere.

An overwhelming majority of my bond holdings are in the form of Series I Savings Bonds. It’s a great way for me to retain as much of my money’s existing value as possible for now, and then once the market stabilizes, I can sell the bonds and reallocate them back into higher-risk stocks.

  6.77%

Cryptocurrency

I started investing in cryptocurrency primarily as a way to diversify my portfolio, but part of my interest also came from the fact that I saw many other people getting rich off buying into cryptocurrency early, and I wanted to join in on the gamble.

Tempo Games is going to be integrating blockchain technology into one of its upcoming game releases. Even though I oversee cor­po­rate operations and am not directly involved in game design or technical en­gi­neer­ing, I still felt like it would be important for me to be familiar with the concept. One of the best ways to learn is to accrue experience through first-hand, hands-on exposure and ex­per­i­men­ta­tion, so I have been making active cryptocurrency investments a lot more in the past few years.

I own a decent chunk of Bitcoin and a little bit of Dogecoin and Shiba Inu token, but a majority of my holdings are actually in the form of the Grayscale® Digital Large Cap Fund (GDLC) and the Bitwise 10 Crypto Index Fund (BITW). These are over-the-counter securities that represent underlying cryptocurrency holdings held by the firms and packaged into a single share, the convenience of which is paid for via a 2.5% annual management fee.

There are three distinct reasons why I own most of my cryptocurrency in this form:

  1. This is less applicable now, but when I first started purchasing cryptocurrency, I was not confident in my ability to manage my own wallet, and I had a mild concern that I would make a mistake that could render all my cryptocurrency useless or gone.
  2. At various times throughout the life of these funds, the market price per share was lower than the actual value of the underlying holdings. For example, on December 31, 2021, GDLC was trading OTC at US$24.25, but the cryptocurrency that each share rep­resented was valued at US$32.18, which means I got a nearly 25% discount on the cryptocurrency I purchased that day.
  3. If there were to be a situation where I suddenly die, my estate would then be distributed amongst my survivors. Because I have no spouse and no children, my parents are next in line to receive my assets. Considering my past experiences with watching them try to use emerging technology, I do not want tens of thousands of dollars’ worth of my assets to be locked behind a mo­bile app that they are going to have to figure out how to swap for United States dollars through a cryptocurrency exchange.
  2.87%

Individual stocks and private companies

I went through a phase when I was younger when I was very interested in researching companies and picking out stocks. In the past few years, I was also a participant of the retail investor movement and buying meme stocks. Since then, I’ve waned down my in­di­vid­u­al company holdings substantially, and instead just stick with companies that are meaningful to me.

I own Marriott International, Inc. (MAR) because they have functionally been my landlord for over a year now after I transferred out the lease to my condo in Las Vegas and traveled across the United States and Canada. I am an Ambassador Elite in their loyalty pro­gram, which is the highest tier achievable through their Bonvoy system; throughout this incredible volume of travel, as well as ad­di­tion­al research I’ve done on other hotel chains, I believe Marriott takes the best approach to lodging out of all the major brands.

I also own Cloudflare, Inc. (NET) and T-Mobile US, Inc. (TMUS) because they are two of my favorite companies to work with. I use almost all of Cloudflare’s available services to support my website, and also used them for Tempo’s corporate needs as well, up until we hired a new IT team and they took over that aspect of the company. I’ve been with T-Mobile ever since I left my parents’ AT&T family plan. I have never faced a single problem with either of these companies. In my opinion, both of these companies take an un­com­mon approach to business, in that they prioritize quality products and high customer satisfaction above anything else, and de­pend on those two aspects to naturally improve cash flow.

Finally, I purchased a nice batch of Stellantis, NV (STLA), the company behind my favorite auto brand and pickup truck, the Ram 1500 Rebel, as well as some other auto companies I’m a fan of, like Alfa Romeo, Maserati, and Jeep. Stellantis has shown great acumen towards advancing vehicle technology and implementing it in previously unestablished ways. I’m looking forward to seeing the Ram all-electric pickup truck, and there is a high chance that it is the next pickup truck that I’m going to end up purchasing.

Note that my holdings for the $10,000 investing challenge with DougDoug are not included in this line item (or in this investment al­lo­cation percentage breakdown at all), as I consider that more of a special project, and also want to avoid people trying to reverse en­gi­neer numbers to calculate my net worth. Instead, I have a brief section about the investment challenge at the end of this blog post.

  4.71%

Precious metals

As a way to even further diversify my portfolio, I took the recently-falling stock market trend as an opportunity to buy into some gold. I’m not really in a position right now to purchase solid gold bars and store them safely with me as a physical hedge against the market, but I found the Fidelity® Select Gold Portfolio (FSAGX) that I can buy from my existing Fidelity brokerage account, which comes close enough.

One thing to note here is that I’m not investing in gold because I’m particularly passionate about it or know what I’m doing; this is mostly a “why not” scenario where I am putting in a tiny fraction of my portfolio into something that I’ve always heard could be use­ful to have during market turbulence.

  1.20%

Fine art, and other collectibles

And finally, as a way to really diversify my portfolio, I began investing in fine art and other collectibles this quarter, and will continue doing so in increments in the future.

There were three factors that set me over the “tipping point” to begin investing in fine art:

  1. I always knew that fine art was something that only rich people invested in, and because of how I believe in the concept of “the rich get richer” (i.e., don’t work for your money, make your money work for you), I wanted to get in on this investment vehicle.
  2. With how “abstract” money has felt in the past few years, primarily caused by the United States government just printing a ton of money out of nowhere during the pandemic and making me question the core principle of the value of money (and, to some extent, how a radical move by the government could theoretically bring the value of my paper money down to zero), I realized that possessing “stuff” is more useful in the long-run than hoarding dollars.
  3. Although I can’t outright purchase fine art at my current level of wealth, I found StartEngine Collectibles Fund I, LLC’s Reg­u­la­tion A+, in which StartEngine has securitized fine art and is selling them as shares. This massively lowers the barrier of entry in­to fine art investing, even if the fees are fairly high. (To be clear, this is not a paid endorsement, which is why I linked to the SEC filing instead of their website; if you’re also interested in this type of investment, you should do your own research and con­sid­er all the options, rather than just blindly using the same company I did.)
  1.88%

 
As promised, to wrap up, here is a breakdown of how my $10,000 stock investing challenge with Doug Wreden is going:

My portfolio is weathering the stock market decline relatively well with a balance of $9,137.88, managing not only to beat Doug and his Twitch chat’s port­fo­li­o, but also the S&P 500 and even the bond market. Doug’s portfolio is at $7,944.67, rapidly re-approaching its all-time low. However, if it’s any con­so­la­tion, I guess he and his community can at least be happy that they didn’t go all-in on cryptocurrency, which would be down to $3,805.97 by now.

 

—§—

 

I’ve secretly been tweeting for the past year and a half

I’ve never really been a fan of social media. I used Facebook a lot during my early years of high school, but I’ve never really found the concept of social media that compelling—the entire premise just felt to me like it would be a great way to have a bad time. I severely waned down my Twitter usage years ago, and a little over one year ago, I pinned a tweet on my profile implicitly announcing my departure from the platform.

Well, I have more than one Twitter account. I have an alternate profile—one that I only let four of my friends follow. I thought it would be a convenient way to collect some of my short thoughts and funny moments that weren’t deep enough to warrant an entire blog post.

Today, I noticed that I had been selected as an early participant in the Twitter Circle early rollout and testing phase. This feature can functionally serve the same purpose as having an alternate account, so I made the decision to stop using my alt and go back to using my main, but only tweeting to my Circle.

As part of this transition, I decided to aggregate and share some of my better tweets from my alt account before I retire it (though I would un-retire it if Twitter decides to discontinue Circle at any point).

One of these days, I will stop misspelling “canker sore” as “cancer sore”

September 24, 2020

I spent literally like an hour and a half today trying to figure out the optimal food to eat when suffering from debilitating aphthous ulcer pain

… and then I just got a burger anyway

September 25, 2020

I am happy to announce that the canker sore is beginning to heal, and the pain has subsided enough that it doesn’t feel like I’m committing suicide every time I chew

September 27, 2020

Time to get in my gym sessions before January 1 when it gets flooded with new year’s resolution people

Paradise, NV
December 27, 2020

In today’s episode of “Chase Fraud Protection is useless,” let’s see if Chase can redeem itself from its 0% success rate in catching fraudulent transactions

Oh no, someone is spending $9 on your card at McDonald’s; block it!

Oops, that’s just Adam getting dinner

Still 0%

Los Angeles, CA
January 26, 2021

I am imagining a scenario where somebody purposely types something wrong, adds “that is a typo” after it, but typos and accidentally writes “that is not a typo” instead

I cannot stop laughing

Why am I like this

March 15, 2021

I have a paper cut under my fingernail

Except worse

Because the cut was caused by one of those sturdy plastic Pokémon card sleeves, so it’s thicker than normal paper cuts, and now it feels like the tip of my finger is going to fall off

April 20, 2021

omg this cut healed a couple days ago and then I got another one on the same finger on my opposite hand

April 27, 2021

Upside of parking under a tree: Less cabin overheating by avoiding direct sunlight in 105°F+ weather

Downside of parking under a tree: Every other bird in Utah insists my truck is their bathroom

St. George, UT
June 19, 2021

I drove past a used car dealership in the middle of nowhere in Missouri today and they had like 30 vehicles on the lot

Literally every single one of them was a pickup truck

Springfield, IL
July 10, 2021

I’ve made my way into the Eastern time zone, but kept my computer on Pacific time to keep things easier for work

I keep looking at the clock and thinking “wow, it’s not even noon and I’ve finished so much work today”

Then I remember it’s actually almost 3 PM

Indianapolis, IN
September 2, 2021

One of my favorite things to do at the airport is to sneak up behind people wearing their mask on their chin when they’re clearly not eating or drinking, and start coughing

Atlanta, GA
October 15, 2021

I got two free water bottles after checking into my hotel a few hours ago

I decided to bring one to the gym, but realized I misplaced them

I spent 2 min searching a tiny hotel room

Then I remembered that I put them in a spot so reasonable that I forgot where

The refrigerator

Albuquerque, NM
November 22, 2021

I’m so good at accidentally kicking things that at this point I’m pretty sure my brain just doesn’t know how big my feet are

Enterprise, NV
December 9, 2021

This is the second time in a row I’m eating sushi with my fingers because I forgot to check the stupid box to request utensils from the restaurant with my order

Loveland, CO
March 21, 2022

I just got attacked by violent, rampant, vicious tumbleweed in the middle of nowhere in Wyoming

I am literally not joking and not exaggerating

Gillette, WY
April 17, 2022

The amount that it rains in the Seattle area should be considered cruel and unusual punishment

Issaquah, WA
May 21, 2022

The person sitting next to me on this plane is nodding off so violently that I confused her for the guitarist of a heavy metal band

May 23, 2022

Great news, she woke up before breaking her neck and now she’s back to doing her crossword puzzle

May 23, 2022

Why is there a bird chirping outside my window at 3:58 AM

Tukwila, WA
May 29, 2022

One of my favorite things to do while driving is to watch compact sedans turn left, but they jerk to the right first so they turn really wide as if they’re towing a 20-foot trailer

Las Vegas, NV
September 28, 2020

Everybody needs to stop not having air conditioning

Los Angeles, CA
October 4, 2020

Every time I decide I am going to stay up late, I am hit with an overwhelming sense of drowsiness

October 29, 2020

I just got off a phone call with Tempo’s account manager at Chase Bank and I believe she is working from inside her fish tank today

January 19, 2021

I don’t understand why I’m able to park a full-size pickup truck between the lines, but California compact sedans require 1.5 parking spaces

Los Angeles, CA
January 28, 2021

Why do people say “I can’t hear you because of your mask” then proceed to take their own mask off as if that’s going to allow them to hear better

March 7, 2021

All three of my roommate’s cats are shedding their winter coats all at once and I didn’t realize cat hair could be considered a lifestyle until now

Paradise, NV
April 2, 2021

I have decided that one of the most amusing parts of my job is that, one moment, I’ll be handling a matter that could cost the company $400k, then the very next moment, I have to listen to someone have a meltdown about something that will cost ~$60 as if it’s the end of the world

April 15, 2021

I cooked today for the first time in several months and I forgot to salt my stupid salmon

Paradise, NV
April 27, 2021

I ordered a BTS promo meal thingy from McDonald’s and they didn’t give me the special promo sauce

Never lucky

Long Beach, CA
June 3, 2021

I watched two videos of someone cleaning out and trimming a cow’s hooves and now every other video on my YouTube recommendation page is of cows

Denver, CO
June 29, 2021

I asked for an American pickup truck for my rental at Avis

The woman said “we only have one truck left, but I know you’ll like it” and gave me the spot number to a Nissan Frontier

I’m pretty sure that is the most insulting thing you can possibly say and do to a truck enthusiast

Anaheim, CA
August 13, 2021

I don’t understand the people who say “photo dump!” on social media, and then only post 3 pictures

Louisville, KY
September 17, 2021

I needed to refuel my truck before leaving for my next hotel, so I looked up gas stations

I found one nearby across the street and thought “great, this is in walking distance”

I was already halfway there when I realized my minor error

Amarillo, TX
November 21, 2021

New Mexico is confusing because tow trucks are apparently allowed to use blue strobe lights here so I keep thinking I’m getting pulled over

Gallup, NM
November 28, 2021

I wonder if people in Louisiana who don’t know about the existence of Los Angeles, but do know about the existence of LA Fitness, ever assume LA Fitness was founded in Louisiana instead of Los Angeles, and then wonder why there are no LA Fitnesses in Louisiana

Long Beach, CA
December 28, 2021

Someone just came into the gym and set the temperature to 78°F

I am going to die

Loveland, CO
March 22, 2022

I just learned that WA passed a new law banning lids on drinks

If you want one, you have to ask and put it on yourself

I’m sure this highly effective law has saved many lids from all those people who look at their about-to-overflow lattes and say “I don’t need a lid for this”

Issaquah, WA
May 16, 2022

This is the coldest cold I’ve ever caught

I cannot stop sneezing

I cannot stop blowing my nose

I cannot

Tukwila, WA
May 22, 2022

I purchased a 1-gallon jug of water because it was like a quarter of the price of a six pack of bottled water

I am drinking straight out of it, and may or may not be spilling water everywhere

Can’t tell if I played the system or played myself

Henderson, NV
May 24, 2022

 

—§—

 

Investing US$10,000.00 in the stock market – Parkzer vs. DougDoug’s Twitch chat

Disclaimer: I am not a registered investment advisor and do not have the qualifications to become one. Even if I was one, I would not be your investment advisor; to you, I am nothing more than a random guy on the Internet writing in his personal blog. This content is intended for comedic and en­ter­tain­ment purposes only. Everyone’s situation is uniquely different, so consult a certified professional if you need guidance with your own financial strat­e­gy.

 
A few days ago, my friend Doug Wreden, a broadcast personality who streams on Twitch and makes video content on YouTube, asked if I wanted to join in on a live event he was doing with his community where, together, they would invest $10,000 into the stock market. Unfortunately, I was overloaded with time-sensitive work that entire day and couldn’t join in live, but we decided to do the next best thing, which was for me to participate after-the-fact.

Thus, “Parkzer vs. DougDoug’s Twitch chat” was born.

 
Rules:

  • Invest US$10,000.00 into ten individual companies (no index funds, mutual funds, ETFs, or bonds).
  • No active trading is permitted after the initial purchase (though reinvesting dividends is allowed), and stocks must be held for one year.
  • The winner is the team with the highest account balance after one year.
  • Any profits beyond cost basis will be donated to charity.

 
Doug has very little investing experience (apart from purchasing Dogecoin as a joke and making a +800% return), so he relied on his community’s as­sis­tance to research companies and pick out the best stocks. Doug uses Robinhood as his brokerage, so that basically speaks for itself. On the other hand, investing and wealth management is one of my favorite hobbies, and I’ve taken it very seriously ever since my first paying job.

However, I knew I couldn’t let this make me get complacent. There are plenty of studies proving that even monkeys randomly throwing darts on a wall of stock ticker symbols can consistently beat investment advisors. Just because I’ve been doing this for longer doesn’t necessarily mean I am go­ing to perform better by default. I needed to es­tab­lish a plan.

 
First, I had to make some predictions and assumptions about what would happen in the coming year. Nobody can predict the future, but what I can do is use current events and cultural trends to make educated guesses. From there, I had to determine which sectors of the market are more and less likely to perform well in the given conditions. Next, I found some companies within those aforementioned sectors that I thought had potential for growth. Fi­nal­ly, I had to trim down my list to ten of my best candidates.

 
I made three major assumptions upon which I would base my investment decisions:

  1. I think the coronavirus pandemic will continue through sinusoidal phases of getting better and worse throughout the year. Although the latest var­i­ant has not been as deadly, it has evolved to become far more contagious. We don’t know how it will mutate next, and with people getting com­pla­cent, this is a ripe opportunity for COVID-19 to cause great damage when we least expect it, resulting in a stock market crash.
  2. I think it is more likely for the stock market to stabilize or fall than it is to rise in the coming year. I think the current state of the stock market is not as healthy as it may seem—it is only this high due to absurd inflation and government policy stimulating economic growth. Once things return to normal and people start repaying their COVID-19 disaster relief loans, money will be taken out of circulation and the stock market will revert back to what it “should” be.
  3. I think the development and modernization of core systems will get faster. Technology companies did well the past few years, but it will still re­quire more work to roll out their advancements infrastructurally so it turns from a luxury into something more commonplace. In simpler terms, I think we have a lot of great concepts, prototypes, and first-generation innovations, but now is the time to keep pushing development so it can be used not only by the elite, but also by the general public.

 
With my grim outlook on the future of the stock market, it is clear that I would have to pick sectors that perform well during a recession. Out of the sec­tors defined under the Global Industry Classification Standard (GICS), I knew I wanted to focus on the following:

  • Consumer staples. No matter how bad the economy, people still need to eat and use core household products. When people have less disposable in­come, they tend to shift their money away from consumer discretionary and into consumer staples.
  • Healthcare. Just because the economy is bad doesn’t mean you’re not going to get sick. On top of that, we are still in the middle of a pandemic caused by a virus that is actively mutating. The healthcare industry is booming, ignoring the fact that that’s probably not the most sensitive way to describe people’s misfortune.
  • Utilities. Similar to the above, people still use utilities during a recession, even if they might try to conserve spending and be more conscious of waste­fulness.
  • Real estate. Again, as you might have guessed, people still need a place to live, even if the economy is bad. However, real estate also bundles in de­vel­op­ment projects, which ties in with the infrastructural advancements I mentioned above that I think will happen.

 
I picked three well-established, reputable companies from each of the sectors above, plus three companies from the remaining sectors not listed above. From there, I took the list of 15 and narrowed it down to 10.

Here are my ten stocks picks with the amount of money I allocated to each company, alongside Doug and his community’s stock picks and their al­lo­ca­tions:

NextEra Energy, Inc. (NEE)

$   800.00

Waste Management, Inc. (WM)

$   800.00

Proctor & Gamble Co. (PG)

$ 1,200.00

Walmart, Inc. (WMT)

$ 1,200.00

Bio-Rad Laboratories, Inc. (BIO)

$ 1,400.00

Pfizer, Inc. (PFE)

$ 1,400.00

American Tower Corp. (AMT)

$   800.00

Prologis, Inc. (PLD)

$   800.00

Digital Realty Trust, Inc. (DLR)

$   600.00

Amazon.com, Inc. (AMZN)

$ 1,000.00
 

NVIDIA Corp. (NVDA)

$ 1,250.00 

Aspen Aerogels, Inc. (ASPN)

$   750.00 

Sony Group Corp. (SONY)

$ 1,250.00 

Netflix, Inc. (NFLX)

$   750.00 

Intel Corp. (INTC)

$   750.00 

CRISPR Therapeutics, AG (CRSP)

$ 1,000.00 

Hasbro, Inc. (HAS)

$ 1,000.00 

Microsoft Corp. (MSFT)

$   750.00 

Costco Wholesale Corp. (COST)

$ 1,500.00 

The Coca-Cola Co. (KO)
PepsiCo, Inc. (PEP)

$ 1,000.00*

*The $1000 for Doug’s final stock selection is split evenly between Coca-Cola and Pepsi as a mini-game between “A Crew” and “Z Crew,” two halves of Doug’s Twitch chat community split by the first letter of their username, to see which brand (and consequently, which crew) has a higher return on in­vestment.

From these stock picks, I think it becomes fairly clear that my portfolio was built not to grow faster, but to decline slower. Thus, if the economy con­tin­ues to do well, Doug’s portfolio will defeat mine, but the economy slows down, my portfolio’s balance will conclude the year higher.

 
I’ve loaded all of our stock picks into some portfolio analysis software, and I might do quarterly (or even monthly, depending on level of interest) re­ports on the performance of our portfolios, showing who is in the process of winning. At the very least, I’ll be providing some statistics, charts, and tables for Doug to be able to review on his live stream.

Seeing as this is ultimately going to be for charity, I wish great success for Doug and his Twitch chat… with the caveat that his portfolio yields 1¢ less profit than mine. GL

 

Edit (January 28, 2022):

It’s been a week since we started this little competition, so I decided to go back and edit this blog post to add in some bonus content in the form of charts and a graph.

First, one thing to note is that, if you’re attentive to the numbers, you’ll notice that Doug’s cost basis is not a flat $10,000.00. This is because, when he was picking out stocks on his Twitch stream, he intended to invest $500 in Coca-Cola (as in, the competitor to Pepsi), but instead, he accidentally invested it into the Coca-Cola Bottling Co. Consolidated. This happened because the bottling company’s ticker symbol is COKE, while the Coca-Cola Company’s ticker symbol is KO; Doug and his Twitch chat got those two mixed up.

After I informed Doug of this error, he sold all his shares of COKE and realized $26 in profit, then put all $526 into KO. I was not aware that he was going to do this, otherwise I would have advised him to only put $500.04 back into KO, because that would’ve been the equivalent return on investment from KO from that time period. Thus, because of the transaction, Doug’s numbers are going to be a little bit off.

Hopefully the final results won’t come down to $26, but if our portfolios are indeed within $26 of each other at the end of one year when we determine the winner, we’re going to need to do a bit of math to see how much this affected Doug’s earnings.

After five market days, this is how our portfolios are looking right now:

For comparison, if we had invested the $10,000 into the S&P 500 instead, it would have grown to $10,230—$97 higher than my portfolio, and $363 higher than Doug’s.

Here is a graph of the price change of each of our portfolios, alongside the chart for the S&P 500. Keep in mind that these are by percentage, and are relative values, so this might not be the most intuitive graph. I ideally would have wanted to graph the total value of each of our portfolios over time in dollar amounts, but it seems like that is not a feature offered by my portfolio tracking and analysis software.

 

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