I have included this chart because for me investing/ speculating in bitcoin and other cryptocurrencies is mainly about charts. I don’t attempt to analyse the fundamentals or rationalise what is happening beyond the core point that bitcoin has limited but not completely frozen supply so there is liquidity and potentially unlimited demand. As you can see from the chart, in 2013, at the dawn of the bitcoin era. bitcoins were not perceived as having any value at all. One unfortunate computer programmer reportedly swapped 10,000 bitcoins for a pizza delivery. Fast forward to 2021 and those two pizzas cost him over $300m. It shows (a) that miracles can happen if you give them a chance and (b) that the bitcoin price could be anything – much higher or much lower than the current price and similarly for other cryptos.
I have alerted bitcoin nine times so far in QV for Shares starting at $3,540. Since then they have been on a wild roller coaster, which enabled me to alert them again nearly two years later at $5,711. They are a classic buy and pray investment. My ultimate case for holding them is that they might go to some ridiculous price eventually. If they can top $30,000 anything is possible, precisely because they are impossible to value, like a Van Gogh painting, which can go from seemingly worthless daubs on canvas, which Van Gogh hoped to sell for $125 to a 1987 sale price for one of five versions of $40m in 1987 to virtually priceless today.
Going back to the bitcoin chart. It is very bullish. If the price went much higher from here technicians would look at that chart and not be surprised; that forecast doesn’t come with a guarantee but it does show the potential. The early price action also tells a story. As soon as people started to get their heads around bitcoin, the world’s first virtual currency, the price rocketed in months to over $1,000. It trades 24 hours a day, seven days a week, all around the world. This is an investment instrument, which is wonderfully explosive. It can plummet too so it is probably not the best home for cash earmarked to pay for your grandchildren’s school fees.
Sadly new regulations mean that from today it is no longer possible for non-professional investors to trade cryptocurrencies on IG, which is another example of the nanny state ensuring that only the rich can make even more money. The less rich are apparently too stupid and feckless to be trusted to take their own decisions.
This chart makes the case for investing in US shares. The Nasdaq 100 excludes financials like boring old banks but does include exciting fintech shares and is heavily weighted for technology generally. Since the 2009 bear market low point it is up over 12 times. Over the same period the FTSE 100 has less than doubled and is still below its all-time peak set in late 1999/ early 2000. Nevertheless, I still have to argue the case for US shares with some subscribers. The wonder for UK-based investors is that the world really is your oyster. People point to the tax advantages of UK investing, which is a great argument for believing that tax considerations should never drive investment strategy. I never invest in ISAs or SIPPs, even though in SIPPs you can hold US shares; I just buy and hold shares in the best companies.
I also treat investing as a game, which is really fun to play (as long as you make money, which I always do or at least have done over many years). My approach has not changed much. It is about finding shares in great businesses, buying them and holding them as long as they stay great (and I don’t get too many margin calls). What has changed, especially in recent years, is the number of great companies, which has increased exponentially and the powerful following wind driving the technology sector, which has steadily increased over recent decades and is now blowing at gale force. Most of the shares I hold are all about technology, creating it or applying it. I don’t hold any what I call old-school businesses and haven’t done for years.
Another key point is the way the US dominates technology although there are signs of life elsewhere, especially in China but in other places too. The best ones are usually obvious, by the way. If you have to think about whether a company is exciting or not; it isn’t. I sometimes get this wrong and think a company is exciting when it isn’t but that doesn’t matter because I spot most of the good ones and the duds are relatively few. The US dominates technology in much the same way as, in the 20th century, Hollywood came to dominate the global film industry
I also believe strongly in giving miracles a chance, as with bitcoin. If you don’t buy and you don’t hold you are never going to benefit if a business grows to the stars as some do. In the past I used to think there were only a handful of really exciting stocks so my portfolio held few shares, sometimes only one but usually three or four. I now work with larger portfolios because there are so many exciting stocks and that way you can spread your risk without giving up on the excitement. Most of the shares in the QV portfolio, around 227 at the last count, are good ones. The average gain on all stocks since I launched the service in 2017 is over 66pc. Not only is the portfolio large but the best performers are recommended again and again so that the average number of recommendations per stock is around six.
My default position with shares, once bought, is never sell. This saves a great deal of agonizing and is usually the right decision. My main sell signal is if the company starts producing bad news and both main moving averages are falling; then I will step aside but even then I look for and often find opportunities to buy back in after the price collapse if the shares show serious signs of life. GetSwift, Wirecard and NMC Health are not coming back, not in this lifetime at least but others do recover because humans are persistent and ingenious creatures with an amazing ability to find a way.
One of the things I do at regular intervals is to go through the QV for Shares table and recommend the shares I like at that moment. I do this mainly based on the price action but with the confidence that all the shares are only in the table because they have great fundamentals, outstanding leadership and exciting prospects. If they weren’t 3G (great growth, great story, great chart) they wouldn’t be there. So the fact that I don’t write much about them in this list does not mean they are weak recommendations; quite the contrary. In the course of putting the list below together I made three investments myself and may well make more in coming days. Funds permitting I would very happily invest in the entire list of 60 recommended shares, roughly a quarter of all the shares in the table.
Incidentally, not being in the list is not remotely a sell signal. It just means I didn’t pick that particular share as a buy on 5 January 2021. Next month the list would and will be different. I haven’t done any special analysis of 2020 performance but I know it has been good, maybe very good. I don’t know how 2021 is going to turn out but, in general, I expect more of the same, albeit with new names coming into prominence and maybe even new sectors. Hopefully, I will be alert to new developments and keep you posted.
Last but not least, the object pf the exercise is to build a great buy and hold portfolio. Do that and the gains should look after themselves, albeit that there will no doubt be some scary moments. The list is long so I am just going to name and price the stocks. Take my assurance; they are all exciting companies with big ambitions. It has taken years of research and close attention to stock market trends to find them, albeit that Accesso is an exception that proves the rule, a dud that just may be flickering back to life.
Accesso ACSO Buy @ 445p MV: £184m Next figures: 18 March Times recommended: 4 First recommended: 2160p Last recommended: 2700p
Activision Blizzard ATVI Buy @ $89.0 MV: $69.50bn Next figures: 11 February Times recommended: 5 First recommended: $61.45 Last recommended: $$82
Afterpay APT Buy @ A$113.50 MV: A$33.5bn (£18.5bn) Next figures: 3 March Times recommended: 9 First recommended: A$54.52 Last recommended; A$110
Align Technology ALGN Buy @ $543 MV: $42.4bn Next figures: 3 February Times recommended: 6 First recommended: $254 Last recommended; $465
Ashtead AHT Buy @ 3600p MV: £15.7bn Next figures: 2 March Times recommended: 9 First recommended: 1803p Last recommended: 2879p
ASML ASML Buy @ $500 MV: $206m Next figures: 20 January Times recommended: 2 First recommended: $420 Last recommended: $466
Autodesk ADSK Buy @ $298.5 MV: $65.5bn Next figures: 4 March Times recommended: 3 First recommended: $187.8 Last recommended; $252
Baidu BIDU Buy @ $212 MV: $59bn Next figures: 25 February Times recommended: 4 First recommended; $259.37 Last recommended; $101
BiliBili BILI Buy @ $101cyb MV: $24.8bn Next figures: 3 March Times recommended: 2 First recommended: $62.50 Last recommended: $74
BioTechne TECH Buy @ $317 MV: $12.25bn Next figures: 9 February Times recommended: 3 First recommended: $279.50 Lowest recommended: $252 Last recommended; $273
Bitcoin Buy @ $34,200 Times recommended: 9 First recommended: $3,540 Last recommended; $18,367
Cadence Design Systems CDNS Buy @ $135.5 MV: $37.5bn Next figures: 27 January Times recommended: 9 First recommended: $71.55 Last recommended: 118
Chegg CHGG Buy @ $89.64 MV: $11.5bn Next figures: 16 February Times recommended: 3 First recommended: $67.81 Last recommended: $81
CoStar Group CSGP Buy @ $889 MV: $35bn Next figures: 23 February Times recommended: 3 First recommended: $725 Last recommended: $860
Crowdstrike CRWD Buy @ $205 MV: $46.2bn Next figures: 19 March Times recommended: 12 First recommended: $92 Lowest recommended; $51 Last recommended: $167
CyberArk Software CYBR Buy @ $151.5 MV: $5.85bn Next figures: 18 February Times recommended: 3 First recommended: $77.50 Last recommended: $98.96
Delivery Hero DHER Buy @ €141.50 MV: €27.2bn Next figures: 28 April Times recommended; 1 First recommended: €119
Diageo DGE Buy @ 2945p MV: £69.9bn Next figures: 4 February Times recommended: 1 First recommended: 3200p
Disney (Walt) Buy @ $178.45 MV: $323bn Next figures: 9 February Times recommended: 3 First recommended: $140 Lowest recommended: $109.20 Last recommended; $129
Domo DOMO Buy @ $61 MV: $1.8bn Next figures: 9 March Times recommended: 3 First recommended: $40 Lowest recommended; $19.34 Last recommended: $44.50
Epam Systems EPAM Buy @ $345 MV: $19.4bn Next figures: 18 February Times recommended: 6 First recommended: $163 Last recommended; $331
Estee Lauder EL Buy @ $256 MV: $92.7bn Next figures: 5 February Times recommended: 6 First recommended: $150 Last recommended: $232
Ether Buy @ $1127 Times recommended: 4 First recommended: $1100 Lowest recommended; $240 Last recommended; $505
Etsy ETSY Buy @ $175 MV: $21.8bn Next figures: 2 March Times recommended: 9 First recommended: $30 Last recommended: $135
Fair Isaac FICO Buy @ $505 MV: $14.7bn Next figures: 4 February Times recommended: 5 First recommended: $210 Last recommended: $477
Ferrari RACE Buy @ $226 MV: $39.8bn Next figures: 4 February Times recommended: 3 First recommended: $131.50 Last recommended: $178
Five9 FIVN Buy @ $172 MV: $11.4bn Next figures: 23 February Times recommended: 6 First recommended: $51.45 Last recommended; $132
Fiverr FVRR Buy @ $210.50 MV: $7.4bn Next figures: 24 February Times recommended: 4 First recommended: $65 Last recommended: $190
Futu Holdings FUTU Buy @ $57 MV: $3.3bn Next figures: 24 March Times recommended: 3 First recommended: $29.40 Last recommended: $48
Globant GLOB Buy @ $214 MV: $8.4bn Next figures: 18 February Times recommended: 3 First recommended: $155 Last recommended: $188
Halma HLMA Buy @ 2521p MV: £9.6bn Next figures: 15 June Times recommended: 9 First recommended: 1490p Last recommended: 2393p
HelloFresh HFG Buy @ €67 MV: €11.1bn Next figures: 3 March Times recommended: 4 First recommended: €28.14 Last recommended: €47.82
Hubspot HUBS Buy @ $381 MV: $17.5bn Next figures: 16 February Times recommended: 5 First recommended: $163.80 Last recommended: $235
IDEXX Laboratories IDXX Buy @ $497 MV: $42.5bn Next figures: 29 January Times recommended: 4 First recommended; $320 Last recommended; $438
Inogen INGN Buy @ $44 MV: $974m Next figures: 2 March Times recommended: 2 First recommended: $191.50 Last recommended; $203.50
Intuitive Surgical ISRG Buy @ $803 MV: $95bn Next figures: 21 January Times recommended: 14 First recommended; $329.13 Last recommended; $780
JD Sports JD. Buy @ 858p MV: $7.9bn Next figures: 13 April Times recommended: 4 First recommended: 600p Lowest recommended: 558p Last recommended; 794p
Keywords Studios KWS Buy @ 2872p MV: £2.1bn Next figures: 16 April Times recommended: 10 First recommended: 1075p Last recommended: 2250p
Learning Technologies Group LTG Buy @ 173p MV: £1.33bn Next figures: 6 April Times recommended: 9 First recommended: 80p Last recommended: 161p
Lemonade LMND Buy @ $118 MV: $6.9bn Next figures: 25 February Times recommended: 2 First recommended: $80 Last recommended: $90.50
Litecoin Buy @ $163 Times recommended: 2 First recommended: $160 Last recommended; $101
Logitech International LOGI Buy @ $99.50 MV: $16.8bn Next figures: 3 February 2021 Times recommended: 4 First recommended: $66 Last recommended: $87
LVMH LVMH Buy @ €505 MV: $258bn Next figures: 26 January Times recommended: 6 First recommended: €249.45 Last recommended: €413
Meituan Dienping 3690 Buy @ HK$310 MV: HK$1712bn (US$221bn) Next figures: 15 March Times recommended; 2 First recommended: HK$223 Last recommended: HK$245
MercadoLibre MELI Buy @ $1650 MV: $82.2bn Next figures: 25 February Times recommended: 12 First recommended: $316.17 Last recommended; $1603
Mettler-Toledo International MTD Buy @ $1176 MV: $28bn Next figures: 11 February Times recommended; 1 First recommended: $1145
MongoDB MDB Buy @ $355 MV: $21.4bn Next figures: 17 March Times recommended: 10 First recommended: $74 Last recommended; $262
Monolithic Power Systems MPWR Buy @ $370 MV: $16.7bn Next figures: 11 February Times recommended: 3 First recommended: $225 Last recommended: $318
Netease NTES Buy @ $101.5 MV: $67bn Next figures: 16 February Times recommended: 1 First recommended: $86
Palo Alto Networks PANW Buy @ $350 MV: $34bn Next figures: 2 March Times recommended: 5 First recommended: $205 Last recommended; $304
Peloton Interactive PTON Buy @ $148 MV: $43bn Next figures: 10 February Times recommended: 6 First recommended: $45.11 Last recommended: $120
Pinduoduo PDD Buy @ $185 MV: $145bn Next figures: 17 March Times recommended: 9 First recommended: $49.57 Last recommended: $154.50
RingCentral RNG Buy @ $383.50 MV: $34bn Next figures: 15 February Times recommended: 6 First recommended: $238.73 Last recommended: $348
SolarEdge Technologies SEDG Buy @ $316.50 MV: $16.2bn Next figures: 24 February Times recommended: 6 First recommended; $147.75 Last recommended; $264
Synopsys SNPS Buy @ $258.50 MV: $39.50bn Next figures: 24 February Times recommended: 3 First recommended; $180.50 Last recommended: $238
Taiwan Semiconductor Manufacturing TSM Buy @ $112.5 MV: $597bn Next figures: 14 January Times recommended: 2 First recommended; $95.50 Last recommended: $105.5
Team17 TM17 Buy @ 830p MV: £1.07bn Next figures: 23 March Times recommended: 6 First recommended: 570p Last recommended; 780p
Tesla TSLA Buy @ $735 MV: $697bn Next figures: 2 February Times recommended: 13 First recommended: $75.97 Last recommended: $648
Twilio TWLO Buy @ $335 MV: $51.5bn Next figures: 10 February Times recommended: 11 First recommended: $61.50 Last recommended: $319
Xero XRO Buy @ A$148 MV: A$21.7bn (£12bn) Next figures: 13 May Times recommended: 13 First recommended: A$38.10 Last recommended: A$135
The short term is always a mystery in the stock market. There are so many forces at work that have nothing to do with corporate performance, which kicks in over the long-term as a determinant of share price trends. This is why QV for Shares is all about carefully choosing shares for their outstanding long-term growth potential, believing in those choices and holding unless their is strong evidence that the shares are no longer 3G. One strategy, which I favour with QV although it is not the only one, ia to invest equal amounts in a growing portfolio of shares and add to positions over time on fresh buy signals. These will usually be at progressively higher prices but if the whole market falls down a snake (experiences a sell-off of which there have been several since 2009) there can be opportunities to add to holdings, still buying into strength but at lower prices. It is not the only way to invest but it is the way, which most closely replicates how QV operates and, on past form, should deliver impressive results.
The chart of the Nasdaq 100 above presents a picture of a troubled decade for shares in the first decade of the new millennium followed by a much stronger performance in the second decade. This may be connected. Investors became disenchanted with shares in the 2000s and came out of shares but have been rediscovering their enthusiasm ever since. At the same time it has become much easier to invest across borders, which has been drawing money from around the world into the strongly performing technology-driven US stock market. I expect this to continue but other stock markets, including the UK’s, seem to be waking up. The choice of exciting companies in which to invest is likely to become even greater.
Cryptocurrencies are a hard-to-read new category of investment. However in a world flush with liquidity and with interest rates at historically low levels it is easy to see their attraction. My view is that they deserve a small place in a growth-oriented portfolio because of their speculative appeal. Are they going to play a major role in the world economy in future? I have no idea but many clever people think they will.
