Starting March 1, 2022, 500to100k will be beginning a second project, 500to100kValueInvesting. This gives everyone time to open a special account for this project (I recommend a Roth IRA for this if you don't have one and are eligible, but any account is fine). In this project we will be focusing on buy and hold value investing of stocks we expect to hold for 3 months to 3 years. The plan is simple, put in what you can and start from there, adding additional funds on an quarterly or annual basis while the project is ongoing (yes, $500 is enough, but you may be buying fractional shares).
I chose a Roth for the tax benefits and the hard limit of $6k you may put in ($7k for those older than 50). I may not be holding these for the 1 year required to trigger long term gains tax, and I would rather not have to worry about the taxes. I intend to choose no more than 10 stocks to take a position in, set a strike price, and wait to hit that number before buying. This project will be more research and fundamentals based than our 500to100k project. If you want to start from the beginning, please have your money transferred and account setup by the kickoff date.
1. Learning about value investing and evaluating companies.
2. +25% avg annual gains over 3 years and a great start on building a retirement account with enough to matter.
3. Beat the SP500 by a wide margin.
Research one stock in depth each month and post a DD to the sub detailing your findings. Also detail the risk the company/industry faces. Lastly, put your recommended purchase price, expected hold length, and expectation of price at 3, 6, 12, 18, 24, 30, and 36 months. We will use the standard [strong sell, sell, hold, buy, strong buy] rating rubric to overall rate these stocks. A second rating, value, will be an amount from 1-10.
I will post a template for DD, as well as a calendar to track DD due dates and rebalance dates.
Follow on postings at these later time frames should analyze where the stock sits relative to the original DD buy recommended. This will also give you an opportunity to update your buy rating.
We will be rebalancing our portfolios once per quarter and develop a strategy and process for how to do that.
I hope that a lot of you join me on this journey. It will be slower, easier to manage on a daily basis, and lead to more market knowledge. I short, we will all together learn how to intellectually access your portfolio and manner intelligent decisions going forward in your own personal retirement accounts.