Each year, I like to do a portfolio checkup when there are just a few weeks left in December. There are a few reasons, such as to see if any of my investments might be good candidates for tax-loss selling, but it's also interesting to see how my relative position sizes have changed over the past year.
In 2023, the S&P 500 has generally had an excellent year, but that isn't the case for all of my top stocks. A few that were formerly top positions for me underperformed, and three of my five largest holdings performed very well.
My five largest investments now
Without further delay, here are my five largest stock positions heading into 2024 and a bit about why I've put so much of my own money into them.
1. MercadoLibre
My largest investment heading into 2024 is MercadoLibre(NASDAQ: MELI). Often referred to as the Amazon of Latin America because of its dominant e-commerce platform, it also has a fast-growing payments platform, a logistics network, and a credit business. Although the company has expanded tremendously, it still produces remarkable growth: In the most recent quarter, gross merchandise volume (GMV) increased by 59% year over year and payment volume on the Mercado Pago payments platform soared 121% to annualized volume of about $190 billion.
2. Pinterest
The advertising industry slowed tremendously in 2022, and Pinterest's (NYSE: PINS) user base actually declined a bit as pandemic-era restrictions went away, but the company has done a great job of turning things around. Pinterest brought in new CEO Bill Ready, a former Google executive, to help maximize its e-commerce potential, and the results so far look very promising.
3. Realty Income
Realty Income(NYSE: O) is a stock I could not check on for 10 years and still be confident that it delivered strong performance in my portfolio. The company is a real estate investment trust (REIT) that owns more than 12,000 single-tenant properties primarily occupied by retail businesses. While REITs have been under pressure due to higher interest rates, Realty Income's business is rock solid. Its tenants generally operate recession- and e-commerce-resistant businesses and sign long-term leases with annual rent increases built in.
4. Dream Finders Homes
At the start of 2023, Dream Finders Homes(NYSE: DFH) wasn't even close to being in my top five, but with the stock up by 228% year to date, it has become a much larger position. The reason for the strong performance is quite simple: Although rising home prices and mortgage rates have created an extremely slow real estate market, it's also created a better-than-expected environment for homebuilders. Thanks to low inventories of existing homes, more buyers are turning to builders like Dream Finders. And its land-light operating model should help the company continue to produce excellent returns for years to come.
5. Berkshire Hathaway
Berkshire Hathaway(NYSE: BRK.A)(NYSE: BRK.B) needs the least explanation of the five. The Warren Buffett-led conglomerate has more than 60 subsidiary businesses, including some household names like GEICO, Duracell, Pampered Chef, and more. It owns a massive $360 billion stock portfolio. And it has $157 billion in cash, giving it tremendous financial flexibility should opportunities arise.
Things could change
For one thing, it's worth noting that the top three are very similar in position size, as all are within a few hundred dollars of one another. So even with minor price fluctuations, it's possible that the order of the top three could change before the end of the year.
Another important note is that I invest new money regularly. At least once a month, I make contributions to both my retirement and standard brokerage accounts and allocate the money into the best opportunities I see at the time. In fact, I've added to all five of these stock positions in 2023. But there are some other exciting opportunities right now (bank stocks, for example), so I can't wait to see how my portfolio evolves next year.
Where to invest $1,000 right now
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for two decades, Motley Fool Stock Advisor, has more than tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and MercadoLibre made the list -- but there are 9 other stocks you may be overlooking.
*Stock Advisor returns as of December 11, 2023
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Matthew Frankel, CFP® has positions in Amazon, Berkshire Hathaway, Dream Finders Homes, MercadoLibre, Pinterest, and Realty Income. The Motley Fool has positions in and recommends Amazon, Berkshire Hathaway, Dream Finders Homes, MercadoLibre, Pinterest, and Realty Income. The Motley Fool has a disclosure policy.
