Saturday, January 18, 2020

A Portfolio Which Returned Over 20% Over 5 Years

It is always nice when a portfolio makes market returns. Better still when the subject of the portfolio is a life long hobby.
A graph of a rising stock and a pile of silver coins, cash, making money in the stock market
A Rising Stock Price

This portfolio should see more growth with the ending of the trade war.

What Stocks Are In This Portfolio?

The stock portfolio which increased over 20% is full of railroads and last mile delivery services.

To take a look at the portfolio now available at M1 Finance CLICK HERE.   

 The majority of the components are North American railroads. Companies such as Kansas City Southern (KSU), Union Pacific (UNP) and as well as the major Canadian Railroad businesses. I also added United Parcel Service and Fed Ex, for that "Last mile delivery."

Despite all of the problems over trade wars, initially with Mexico and Canada then moving on to Peoples Republic of China, my railroads have done well.

A little over a decade ago I was buying CSX at $20, it now trades at over $70. Union Pacific a decade ago traded around $140, and today trades at about the same level but in the early 2010's the company split its stock 2 for 1 and traded for a while for less than $100. I bought at those levels and am still a buyer now.

This portfolio also produces a near 3% dividend yield.  Not bad for companies which were in their fast paced growth phase over 150 years ago. Loving them as I do, trains are great for the environment. They can move lots of items, trade goods, commodities and finished goods long distances for low costs and quickly.

Why do I see Railroads as the investment of the Year?

       In recent weeks we have seen the new U.S., Mexico and Canada Trade Agreement move towards ratification and the signing of the first part of a China and U.S. trade agreement.

In my opinion railroads will be major beneficiaries of these agreements.

Canadian rail companies will see movement of items such as lumber and oil to the U.S. Mexico will see continued expansion of goods such as automobiles,  That is good especially for Kansas City Southern, which has access to hubs in both the United States and Mexico.

Union Pacific is the major railroad company serving the West coast ports, with exports of food stuffs and commodities such as Soy Beans expanding to fill demand in China and a possible up tick in imports of consumer goods through the ports of San Diego, Seattle, and Long Beach profits should be secure.

Norfolk Southern and CSX should be secure too, Britain will look for more trade with the United States following Brexit at the end of January and the East coast ports should see recovery as trade with the European Union begins to grow again, following the end of the trade war with the E.U. and as Europe begins to come out of its recession, I think in the last quarter of 2020 or early 2021.

Again you can see the M1 Pie which I created at Train Sets and Last Mile.

Disclaimer: The above link is an affiliate link. If you use this link you can open an account with M1 Finance. If you do open and fund an account with M1 Finance using this link, I may receive cash or stock in kind for introducing you to the M1 Finance platform.

The material in this post is created as a statement of my own views, it is not intended to be taken as financial advice. You should discuss you financial situation with a qualified person such as your accountant, legal advisor or financial advisor.

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