My 2022 and some updates

I did not have a great 2022. Lost almost exactly 10%. Still slightly better than the market though. But considering that my blog stock picks significantly outperformed the market it is disappointing. I like to group my losses into bad luck and stupidity. And most of my bad performance was because of stupidity. The main one being keeping SBSAA as a 20% position. I should have pressured Interactive Brokers harder to get trading permission back. 

I made multiple large preventable mistakes that probably cost me at least 15% in performance. I also should have concentrated more on Extreme Networks (EXTR). It was my biggest no-brainer idea this year. Everything lined up with that one and I only made it a ~10% position. Could have easily taken that closer to 20%. 

I am really glad I deleted my Twitter though. I am more focussed now. I think it contributed towards some of my mistakes. My brain is not built to handle social media well. I prefer long form writing. Slower and more rigorous. 

Trading updates

I will close the VNET here for a 26% gain. Spread is still wide, but with the uncertainty of a deal and the questionable fundamentals I would like more upside. 

I want to reopen 111, inc (YI). Stock has dipped back down to below $2.9 again. 2023 will be a good year for them, and I still think there is a decent chance it will be bought out with a price increase. These Chinese merger stocks have been excellent trading vehicles so far. 

And I added to Tegna (TGNA). The stock trades at about 7-8x FCF with odd years being an off year for them due to lack of political advertising. Valuation is about in line with what it was pre announcement and with Nexstar, the closest competitor in terms of margins and debt level. Odds of merger going through at $24+ seems decent and downside is still minimal here. Although I admit I traded in and out of it and got somewhat lucky. If the merger breaks I expect a large buyback to further mitigate downside.

Similarly added to (OIIM). Merger looks extremely likely to close here in less than a month, yet the spread is still 10%. 

Furthermore I will close Tyman (TYMN). Earnings will probably deteriorate a bit this year and the stock is trading at close to a 9x PE. The average in the past 5-6 years has been about 10-11x. Not a bad hold, but I want to be in stocks that are seriously cheap. “Not a bad hold” is not good enough.

Overall I have a hard time finding really cheap stocks now. Still close to 100% invested, but a lot of stuff has run up. And I think some earnings estimates are too optimistic about 2023. This will probably be a bit of a hangover year, where the impact of higher interest rates really kicks in.

Two stocks that I have been researching and that look interesting are NMIH and PAGS. I am not a buyer yet though.

Splitting up this newsletter

In 2023 I will also split this newsletter up into 3 parts. I want to write down my thoughts on subjects other than investing. Which was originally the plan. I really enjoyed writing this post about the DRAM industry, which was more philosophical in nature.

I am also interested in doing a weekly post about art and interesting photographs. I have collected probably about 10,000 pictures over the years. It would give me a nice excuse to browse through my collection and organise it more.

But since most subscribers got here for the brief stock write-ups I feel like I am pulling a bait and switch if I post them here. So I will set up separate blogs/newsletters for that for whoever is interested.

More information on this coming soon when I have more time.