M1 Finance Portfolio: Dividend Aristocrats 2020 - Week 18 (February 14th, 2020 - $297.06)

Week 18 - $297.06

Despite the increasing numbers of reported COVID-19 cases and mixed consumer data, businesses in China have resumed and the stock market continues its positive trend for the week.

Total Report (Since October 11th, 2019)
 

Positive Performing Sectors
1. Healthcare (+15.48%)
2. Information Technology (+12.87%)
3. Consumer Staples (+8.60%)
4. Industrials (+7.59%)
5. Utilities (+6.86%)
6. Financials (+6.81%)
7. Materials (+4.80%)
8. Communication Services (+2.45%)
9. Consumer Discretionary (+2.28%)

Negative Performing Sectors
10. Real Estate (-4.21%)
11. Energy (-9.77%)

Weekly Report (February 14th, 2020)

Positive Performing Sectors

1. Consumer Discretionary (+1.50%)
2. Industrials (+1.39%)
3. Utilities (+1.31%)
4. Energy (+1.16%)
5. Materials (+1.12%)
6. Information Technology (+1.07%)
7. Consumer Staples (+0.63%)
8. Healthcare (+0.42%)
9. Financials (+0.23%)

Negative Performing Sectors
10. Communication Services (-0.23%)
11. Real Estate (-0.50%)

GICS Sector Performance Ratio - Balanced: From 10:1 (90.91%) to 9:2 (81.82%)

Review

The stock market performed positively this week despite the growing number of reported COVID-19 cases and its likewise fatalities and the mixed consumer report this week. Chinese businesses resumed operations and the initial scare of economic impact the epidemic may have inflicted has for the most part worn off. It is expected that the economy will continue to positively perform for this year.

That said, it is worrisome that the stock market is continuing to accelerate upwards despite conflicting economic reports. Generally the stock market will deviate from the real economy by some percentage, and that is to be expected. However when this deviation continues in a certain direction for too long, this can result in a valuation bubble. Equity is the main indicator for a stock's market value, even though it is based purely on the average sale price for trades of that stock at a given moment. Its real earnings will be vastly deviated from its selling price. It is impossible for everyone holding the same stock to receive the same equity price if they were sell at the exact same moment, much like a bank run, as the equity is only as valuable as someone else is willing to pay for it. Thus, one should expect a slight correction in the stock price in the next few weeks as stock price drops and investors look to cash in on these gains.

Last Week's Update (February 7th, 2020)

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M1 Finance Dividend Aristocrats 2020 Pie: https://m1.finance/quB1JH2k6