In the first three articles in this series, we explained investable benchmarks, leverage and risk control. In this final installment, we focus on leading growth stocks.
4 Steps to Investment Success
- Risk Control
- Leading Growth Stocks
Leading Growth Stocks
While many investors would prefer to target growth returns through the Income and Growth 3x (IG 3x) investable benchmark (see chart), some individual stocks are worth owning long-term and/or trading at times.
Over the past five years, Amazon (AMZN) and Tesla (TSLA) both had great stock performance, yet TSLA still delivered almost double the total return of AMZN.
Tesla is “Next Apple”
Leading growth stocks, including Nvidia (NVDA), Facebook (FB), Amazon (AMZN) and Netflix (NFLX), have all performed very well. However, Tesla (TSLA) is our top pick long-term, and it is currently our largest individual stock position.
At ETF PM, we believe Tesla may exceed Apple’s legendary return, given the company’s track record for extraordinary innovation. Tesla is well-positioned to build the largest and most dynamic integrated platform for advanced energy generation, storage and transportation.
Many of Tesla’s advancements are priceless, especially in sustainable energy, clean transportation and auto safety. Looking ahead, the Tesla Network could be the first autonomous car service, and it may even enable Tesla car owners to make money renting out their cars.
The company’s solar and battery divisions are also rapidly improving in product appearance, capacity and integration. New solar roof tiles are expected to lower roof costs and be somewhat indistinguishable from non-solar tiles, while the second-generation Powerwall reportedly has double the energy capacity.
Nobody knows the right valuation for Tesla (TSLA), or what the company, or stock, may deliver next. However, in our opinion, Tesla has the most impressive track record of strong stock performance and limitless innovation.
ETF PM currently has long positions in Tesla (TSLA), Facebook (FB) and Income and Growth 3x (IG 3x).
While past performance is never a guarantee of future results, be sure to catch all four steps to investment success!
David Kreinces is the Founder & Portfolio Manager for ETF Portfolio Management (ETF PM), a Thousand Oaks-based financial advisor. To learn more, visit ETFPM.com or call 866.409.5844.