How I destroyed the stock market using just 13 winning stocks
Whenever I make any money on side hustles like writing here or publishing YouTube videos, I put a chunk of that money directly into the stock market.
In fact, most of the money goes into just 13 mostly blue chip stocks.
These stocks have combined to return more than 24% percent for me over the past year and a bit — compared to the 4.53% return of the S&P 500 over the same period of time.
Later, I’ll tell you about my trading strategy that produced those returns, but first, let’s jump right into the list of the top 13 stocks that helped me absolutely crush the market over the past year.
Number 13
Folks, before we get going, I am NOT a financial advisor. I’m not suggesting you buy any of these stocks. Talk to a financial professional and never spend money you can’t afford to lose.
Alright, coming in at number 13, with a 5.48% return in my portfolio, is Amazon.
The e-commerce giant may not be a particularly interesting pick, but what I love about it is how diversified it is — think Amazon Web Services — and its ability to make strategic acquisitions to keep pace with emerging technologies.
For example, Amazon recently committed to investing up to $4 billion in AI startup Anthropic to boost its cloud offerings.
Number 12
Coming in at number 12 is US banking leader JP Morgan Chase, which returned 6.77% to me in addition to paying dividends yielding 2.89% at the time of this writing.
JP Morgan has excellent management, a strong track record, and the title of America’s biggest bank.
It’s hard to compete with all that.
Number 11
Coming in at number 11 is Cisco, which provides key IT infrastructure and products like VPN for many workplaces — including mine.
Cisco, which has returned 9.28% in my portfolio, also pays you a dividend to hold onto it, which at this time is around 3%.
Number 10
At number 10, with a 9.37% return, is streaming leader Netflix.
Netflix is still the first streamer anyone turns on in my house, which is why it holds a place in my portfolio.
The stock has had its ups and downs lately, but as long as it remains the leader of the pack among my TV apps, it’ll keep it around as an investment as well.
Number 9
Number 9 is also the first streamer I turn to for content — but this one is for music.
The company is Spotify, which has returned 13.73% for me during the period covered.
I used to use Apple Music for audio streaming, but I’ve since switched and I’ll probably never go back.
Number 8
Speaking of Apple, it comes in eighth with a 14.08% return for me since my strategy inception.
I may not use Apple for music anymore, but I do use its devices, app store, and e-commerce functions, all of which the company gets a piece of.
The 0.54% dividend is less than exciting, but it’s a nice little bonus nevertheless.
Number 7
Coming in at number 7, with a 15.34% return is my main credit card issuer — Mastercard.
I had my doubts when I kept firing into this one all through the summer and early fall of 2022, but I stuck with it and it has since paid me back.
The business of processing transactions remains a good one.
Mastercard’s dividend yield is also tiny at 0.57%, but I do get rewards on all my purchases with its cards.
Number 6
We return to Big Tech at Number 6, with one of my favorites in Microsoft.
Like Amazon, Microsoft is always either innovating or buying companies that are.
For example — as I point out in the video below — the company is a big investor in OpenAI, the creator of ChatGPT.
But the real value for me is in the operating systems, software, and MS Teams, which is taking over people’s workplaces one day at a time.
Microsoft has excellent management, tons of cash, and an insanely lucrative business model.
It’s one of my biggest holdings, it returned 17.48% for me, and it pays me a 0.92% dividend for holding onto it.
Number 5
Kicking off the top 5, we have the first of my heavy hitters for the year.
We jump all the way from a 17% return for Microsoft at Number 6 to a 27.21% return for Adobe at Number 5.
I use Adobe products every day for content creation including Premiere Pro for all the videos on my YouTube channel.
I’ve also been playing around with the generative AI functions in the new Photoshop Beta and they’re making creative tasks cooler and easier than ever.
The subscription model is great for the company’s bottom line and I believe it provides by far the best products in this space.
Number 4
At number 4, with a 31.33% return, is my favorite company, Google.
Google is life infrastructure for me at this point — from search, to YouTube for content creation and entertainment, to AdSense for monetization, to Docs, Keep and Sheets for software, to Fitbit for fitness tracking … the list goes on and on.
I would be lost without this company in 2023.
Number 3
In the bronze medal position is SoFi, with a 43.51% return.
I actually use the Canadian equivalent of this company, but since I only invest in American equities, SoFi holds this spot in my portfolio.
At one point I was up more than 100% on this position, but it has since settled back down.
To me, these types of all-in-one, banking/trading/lending, super user-friendly fintech apps are the way of the future.
The convenience of having everything in one place and an ease of use that the big banks can’t provide make this a total game-changer for me.
Number 2
One off the lead is Apollo Global Management, which returned 55.94% for me this year.
Apollo owns Yahoo! Finance, which I use to track news and my portfolio performance, but it also does a lot more important wealth management-type stuff that contributes to a decent 1.83% dividend.
Number 1
And my top performer using this strategy is Meta Platforms. The Metaverse is still a big drain on the company’s business, but cash cows like Facebook and Instagram more than make up the difference.
With a 58.74% return over the time covered, it takes the gold medal and the title of my best stock trade of the year.
Moving forward
What’s the point of listing these stocks, especially in a portfolio so small?
Well for me, it shows that small investors can get an outsized return without gambling on penny stocks or options.
Now that I’m confident that my strategy works for me, I’ll start pumping up my buys over the coming year in this portfolio while also testing new trading strategies.
How I did it
So what exactly was this strategy?
Well, it’s actually not that complicated. I followed some simple rules to generate a pretty nice return.
Rule 1
I have a personal Golden Rule I apply to this portfolio, and it goes like this: I only invest in companies that I use every single day.
There are two main advantages to this approach.
- By only investing in companies that I use every single day, I’m effectively putting money back in my own pocket every time I spend time or money with them.
- I can be confident that the company provides an excellent and/or essential product or service — otherwise, I wouldn’t use them!
By sticking to companies I use daily, I can also be confident that the company will have the cashflow necessary to sustain it in the kind of deep recession I think we’re going to hit in 2024.
Rule 2
I only invest in companies that provide services, not physical products.
I want companies that I understand, that have relatively simple business models, and that have relatively low overhead and infrastructure needs.
All of this provides the opportunity for a high net profit margin, and for the most part, I want to own companies that are making money now.
Rule 3
The more products or services I use from the company, the more stock I buy.
Some of my biggest holdings are Google, Amazon, and Microsoft because I use so many of their products.
Rule 4
I only make small, fractional buys on stocks when they’re beat up or on sale, and only on days the market is red.
This allows me to pick things up at a discount and average down if the stock keeps falling.
Using fractional trading on platforms like Robinhood or Wealthsimple here in Canada, you can now take positions in stocks for as little as $1 and build positions over time.
And this is a total game-changer for small investors.
The final rule
One of my favorite parts of this strategy is that I always know exactly when to sell — when I stop using the company.
If the company’s services become too expensive, experience a drop in quality, or get surpassed by another company’s offerings, I can close my position confident that I’m making the right decision.
What’s next
Now that I’ve tested this strategy over the course of a year and believe in it, I’m planning on making bigger buys in the coming year — especially if we get hit with a recession and stock prices get beaten down.
I’ll also start experimenting small with some other strategies I think could also wind up outpacing the market the way this one did.
Hey, thanks for reading all the way to the end! If you enjoyed this piece please give it a clap or two and let me know in the comments what your best trade of the year was!
Disclaimer: Numbers were accurate at time of writing and will not be accurate at time of reading. The author of this article is not a financial advisor. This commentary is provided for general informational and entertainment purposes only and should not be construed as financial, investment, tax, legal or accounting advice. It does not constitute an offer or solicitation to buy or sell any securities referred to. Consult your financial advisor prior to making financial decisions.
My recent work:
- Why you’re a liar if you say you have no time to make money writing online
- 3 important health habits that help me earn big money on the side
- Why I keep writing about this 1 thing even though nobody cares
My most popular stories:
- Do these 4 exercises and you’ll be in the best shape of your life
- The 1 main reason most people fail to make money online
- The one priceless book that kicked off my quit alcohol journey
- Jacked Rob Lowe revealed the 1 harsh truth about staying fit at 60
- Wow, YouTube just slashed its monetization threshold in half
Still looking for something to read? I really enjoyed this piece by Andrii Zolkin on his search for the best productivity apps.
