Value Investment Fund Status Week 8 – Patience

Value Investment Fund

During the week ending December 19, 2020, the Value Investment Fund retracted 1.64%. Whereas the DOW reported a slight uptick of .24%. The continuing lack of action in Congress greatly affected the REIT Pool as its value decreased 2.8% which is 100% of the decrease during the past week. It appears that on Saturday the 19th, Congress has finally reconciled the major sticking points of a relief package. Thus, Monday should see a good recovery for the Fund once Congress passes this stimulus bill.

At the beginning of the week, the Investment Fund’s status stood at $113,959 (see Week 7 report) and then on Friday night after closing (December 18, 2020) the Fund’s balance stands at $112,094. The following is the Fund’s respective individual balances by pool along with cash and dividend receivables:

REIT Pool                               # of Shares     Cost Basis     Market Price*         Fair Market Value
    – Equity Residential               574.459           $30,000             $56.65                      $32,543.10

    – Essex Property Trust             48.9644           10,000             233.37                         11,426.82
    – UDR                                    606.9803           20,000               36.01                        21,857.36      
       Sub-Totals                                                  $60,000                                               $65,827.28
Railways Pool
   
– Union Pacific                     114.9557           20,000              202.60                         23,290.02
Banking Pool

     – Comerica Bank                 369.9593          20,000                 51.59                         19,086.20
Dividend Receivables (Union Pacific & Comerica Bank)                                                 363.07
Cash on Hand (Sale of Norfolk Southern & Options)                                                    3,527.59
Totals                                                             $100,000                                              $112,094.16

*Net of transaction fees of $1.00 per share; thus the amount in the schedule equals the actual market price per share at closing less $1.00.

The Investment Fund’s overall status for the two months to date for the new year against three of the top indices is as follows:

DOW Jones Industrial Average                                     2.28X Higher
S&P 500                                                                         2.2X Higher
S&P Composite 1500                                                     2.0X Higher

Overall, the fund is outperforming the market even with another week’s setback. One of the core four principles of value investing is patience. Since the COVID-19 vaccine has started distribution to the country, it is just a matter of time to see recovery and acceleration with REIT stocks. While most of the market has already displayed market price recovery from the market decline back in March of 2020, REIT’s have not recovered due to the higher than normal unemployment status nationwide. As this begins to turn positive, REIT investments will accelerate with their market price recovery back to pre-COVID prices. It is just a matter of time.

New Activity During Week 8:

  • No Buy/Sell Activity During This Period

New Information Released During Week 7:

  1. Lesson 10 Financial Statements – Explores the five different financial reports investors review for valuation purposes. Includes basic introduction to each and the key important financial dynamics presented. It is a good introduction to reading financial statements.

As covered in multiple articles and lessons, patience and adherence to the respective buy/sell models will generate far superior returns with value investing over any other investment model. Act on Knowledge.

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