Value Investment Fund Status Week 20 – Super Growth
The Club’s Value Investment Fund had the best week, March 13, 2021, this fiscal year-to-date. The Value Investment Fund grew a whopping 6.5%, $8,867 over the prior week’s ending balance. This is all due to the COVID relief package signed into law. Over the past week, the DOW grew 4.0% and the S&P 500 grew 2.6%. The Fund’s strong growth was spearheaded by the REITs pool of investments. As stated in multiple articles about the rebound for REITs written over the last five months, once the pandemic fear subsides, the market price recovery will accelerate for real estate based companies. Last week the REITs pool balance was $88,550; this week’s ending balance is $94,876, a 7.1% increase.
Here are the current balances and breakout as of March 13, 2021:
REIT Pool # of Shares Cost Basis Market Price* Fair Market Value
– Equity Residential 574.459 $30,000 $72.44 $41,613.81
– Essex Property Trust (Tranche #1) 48.9644 10,000 286.83 14,044.46
– Essex Property Trust (Tranche #2) 43.2994 10,000 286.83 12,419.57
– UDR 606.9803 20,000 44.15 26,798.18
Sub-Totals $70,000 $94,876.02
– No Stock Holdings
– Bank of New York 232.9373 10,000 45.66 10,635.92
. – Wells Fargo (Tranche #1) 292.0560 10,000 38.97 11,381.42
. – Wells Fargo (Tranche #2) 558.9715 20,000 38.97 21,783.12
. Sub-Totals 40,000 43,800.46
Dividend Receivables -0-
Cash on Hand (Gains, Dividends, PUTS) 5,616.54
Totals (Starting Cost Basis = $100,000) $110,000 $144,293.02
*Net of transaction fees of $1.00 per share; thus the amount in the schedule equals the actual market price per share at closing less $1.00.
The recovery for the REITs Pool is exceeding the projected nine to twelve months rebound forecasted back in November 2020. The current price recovery sell points are:
- Equity Residential $81
- Essex Property Trust $301
- UDR $51
It is possible that all three investments will hit their respective targets by July. If this holds, the annual return will exceed 64%; if it takes until October, the annual return drops to 48%. The results exceed the expected returns for value investing. Timing is explained in detail in Phase Two of the membership program with this site’s value investing program.
Overall, the entire portfolio is performing in accordance to plan. The investment fund follows the primary tenet of buying low and selling high. The management of the fund adheres to four principles of value investing:
- Only buy high quality top 2,000 companies;
- Reduce risk by establishing intrinsic value and purchasing the stock for less than intrinsic value;
- Conduct a financial analysis to determine a reasonable target for market price recovery;
Act on Knowledge.
© 2021, David J Hoare MSA. All rights reserved.