At the beginning of 2020, I started a new M1Finance portfolio where I picked 7 dividend stocks to compare against VTI. The goal was to have a similar appreciation, but better dividends. On Feb 24th, news about COVID-19 sent the US stock market into a frenzy. We have since seen 9 (as of 3/13/20) 1000+ point swings in the DJIA. In this article, I’ll share my M1Finance portfolio, how I’m doing against the total stock market, and share my thoughts.

My Performance

My overall portfolio is down -18.40% YTD and I have unrealized losses of -$5710.11. I’ve earned $138.58 in dividends. And when compared to VTI (total stock market, -19.35%), my portfolio is outperforming it by +0.95%. Overall, I’m fairly satisfied with how things are playing out, especially given a rough start to the year with Target and 3M.

What am I doing next?

Several folks have emailed to ask what am I buying? What is my strategy? Do I have cash on hand? I’ll try to make it comprehensive, but feel free to leave a question in the comments as well.

• I have *not* changed my dollar-cost-averaging strategy. It’s still $1k per week for the M1Finance portfolio. We are down 20% from the all-time highs. It’s significant, but not enough to get me excited about DCA-ing more. After Q1 earnings are published and the markets start to respond to real numbers, I may increase the amount. 

• I bought individual stocks outside of my M1Finance portfolio. They are HD, NKE, and CVS. I like these companies and do not think that the coronavirus will have a long-term impact on them, unlike cruise lines and airlines. However, I feel like airlines may get some form of a government bailout.

• I’ve been fortunate enough to have kept a 10% cash position. I expect to buy a lot more once Q1 earnings come out or if the market drops 30% from the all-time highs. For now, it’s the normal weekly dollar-cost average and sniping companies that I like.

• I am not looking to buy cruise lines because they were struggling even before coronavirus.

• I am not looking to buy airlines...yet. As I mentioned above, I think that if they struggle, then the government may step in to prop them up. If so, I can see a full recovery in their stock price. It is currently down by 50% which implies a 100% increase to recover.

• Times like this are rare. This is the fastest crash in stock market history--see chart below. So while I can’t really go wrong by buying the index, I feel that the biggest opportunities will be picking individual stocks that have oversold. I’m looking at stocks such as Lyft & Uber. Both just had their best quarters. Ridesharing will be impacted in the short-term, but assuming they can weather this storm, their long-term outlook should remain the same pre-coronavirus.

COVID-19’s long term impact

I cannot believe that my plan to FIRE is only 2.5 years away. Will the stock market recover in time? Will it go down even more? I’m optimistic and am betting “yes”. However, even with all of the losses this year, I am still within $25K of where I need to be in order to FIRE “on time”. Prior to coronavirus, 2019’s monster runup in the stock market positioned me to be ~10 months ahead of schedule. Let’s see how quickly we can recover from this.