Just like some people are thankful that its finally Friday, I am very happy to put 2020 to bed and start off a new year. Even though 2020 was spent cooped-up like a caged tiger, it was very profitable to those who had a diverse basket of stocks and fixed income. First I will look at what I did right and then I will look at what I got wrong. My winners included some tech names like Tesla, Lam research, Micron, and others. Home builders were also strong with a 27% return on average. Financials ended the year with a 1.6% loss but have been very strong in the last few months, racking up a gain of 28%. Small cap stocks only did a measly 2% for the year but they also have come on strong over the last few months to return 35% as of late. I was correct to assume that interest rates would remain unchanged which gave stocks a tailwind because of a lack of alternatives. What I got wrong was that energy stocks would finally start to perform better. I was completely blind-sided by the Covid 19 virus even though I am convinced that when I wrote my 2020 forecast, I might have been suffering from it. Looking back, 2020 was by far the most profitable year I ever had as an investor. Looking forward, I want to try to hold on to the gains of last year. I have no doubt that a mild sell-off in stocks is in the cards for us but I think it will be short lived due to the massive amount of capital sitting on the sidelines, waiting for a chance to buy growth names at a discount. I also believe that value investing will gain some traction in 2021 because many good companies did not participate in the 2020 gold rush. One of my favorite ideas going into 2021 is bank stocks and other financials for reasons listed in my previous blog titled "Buy The Bank". With a vaccine roll-out, however flawed, and a slow reopening of our economy, there will be many opportunities to profit from stocks in depressed industries like travel, casinos, hotels, airlines, and entertainment. The growth names of last year will continue to perform well going forward, especially some tech names due to the 5G rollout and a shortage of chips for electronics and the automotive market. Even all major home appliances have silicon chips in them nowadays. I am in the process of downsizing and decluttering my portfolio currently by selling some individual names and replacing them with ETF's representing my investment themes. This is a more targeted way to invest while diversifying within sectors. My biggest fear for the future is inflation. Interest rates are inching up, and when this economy opens again, the demand for goods and services may exceed supply, causing price increases,
