Revisiting Corona Picks [US Version]

My last post was about how I beat the market by buying great companies at good prices in the Indian markets during the past 2 months of COIVD-19. This post I revisit how my US picks performed against the market.

On March 25th, I wrote a post where I put together a shortlist of companies that, in my opinion, were a great buy after the crisis.

I divided the companies into four categories-

  • Bargain Basement

  • Safety at Reasonable Price

  • Change Agents

  • Distressed Equity

These were the companies-
Bargain Basement:
DAL
BA
XTN
ERUS
MCHI
Safety at Reasonable Price:
FB
MSFT
GOOGL
V
BKNG
MA
DIS
AAPL
BRK.B
Change Agents:
ZM
NFLX
TDOC
UBER
Distressed Equity
MGM
WYNN

Its been almost two months and what two months they have been!

US markets are an arms reach from an all-time high.

Amidst all this optimism I want to revisit the post from March 25th. I shortlisted some 20 companies. Let’s take a look at how we did? Are the companies in green, and if so, did we beat the market?

Well, let’s see how the market or the index did from March 25th to June 4th. The index, which in this case, is the S&P500 was at 2,476 points, and it closed on June 4th at 3,193. That is a return of 29%! Like I said last 2 months were pretty crazy.

Now let’s look at our picks.

If we were to invest equally in the 20 shortlisted companies, we would have a return of 37%! In other words, we beat the market comfortably :-)

None of the companies have a negative return. The best performing is Boeing, with a return of 93.80%, while the worst performing is Delta with a return of 10.20%.

How did the four categories perform?

Bargain basement returned 43%
Safety at Reasonable Price returned 35%
Change Agents return 31%
Distressed Equity returned 51%

Each category beat the market’s 29%.

I’ve held some of those companies for more than 3 years and I plan to continue holding most of them for the foreseeable future. I did sell some Delta and all of the Distressed Equity. I do think demand in those businesses (airlines, resorts, and hotels) will take some time to recover.

You can find more details on this spreadsheet.