Only one month ago, the S&P 500 was enjoying a 17% four-week upswing. But now roughly half of that gain has evaporated. It didn't help that on Tuesday of this week the major stock indexes experienced their biggest one-day decline since June 2020.
Many investors were already asking whether or not it was a new bull market or just a bear market bounce. With the S&P again flirting with bear market territory and the Nasdaq Composite Index again firmly in a bear market, the answer to that question seems to be obvious.
Should you throw in the towel on stocks, at least temporarily, during this period of intense volatility? I've made up my mind. Here are all the stocks I'm selling in this wild market.
The complete, unabridged list
I own well over 40 stocks in my personal portfolio. Below is the complete, unabridged list of all the stocks I've decided to sell with the market going haywire:
No, your screen isn't malfunctioning. The list is indeed empty. I'm not selling any of the stocks I own right now. Furthermore, I haven't sold a single stock this year.
Some decisions to hold on were really easy. For example, I bought shares of Devon Energy (DVN +2.46%) last year and enjoyed a relatively quick and significant gain. With Russia's invasion of Ukraine in early 2022, I was pretty sure that Devon would again deliver a strong performance. That turned out to be a good hunch. So far this year, Devon's shares have skyrocketed by over 55%.
NYSE: DVN
Key Data Points
It wasn't hard to hang onto my shares of Vertex Pharmaceuticals (VRTX +1.25%), either. The big biotech stock fell 7% last year. However, I expected that Vertex would have some good news in 2022. And it did.
NASDAQ: VRTX
Key Data Points
Vertex and Crispr Therapeutics are on track to soon file for regulatory approvals of gene-editing therapy exa-cel in treating rare blood disorders sickle cell disease and transfusion-dependent beta-thalassemia. Vertex has also advanced promising candidates targeting acute pain and APOL1-mediated kidney disease into late-stage testing. Meanwhile, the company continued to generate strong revenue and earnings growth. Unsurprisingly, the stock has jumped nearly 30% year to date.
Sticking with losers
But most of the stocks I own haven't racked up big gains this year as Devon and Vertex have. My portfolio includes quite a few big losers.
As a case in point, Nvidia (NVDA +1.90%) has lost more than half of its market cap so far in 2022. So has Block (SQ 2.24%). It's painful to see these kinds of huge losses.
Then there's Teladoc Health (TDOC 4.55%). Shares of the virtual care provider have plunged more than 65% year to date. Teladoc is a whopping 90% below its peak set in early 2021. Ouch.
NYSE: TDOC
Key Data Points
And yet I'm sticking with these losers. Why? I still believe in their long-term growth opportunities. I still think their underlying businesses will be successful over time.
My view is that artificial intelligence (AI) will become more pervasive over the next decade and beyond. I expect self-driving cars will move beyond novelties in the not-too-distant future. The metaverse might not live up to its early hype, but I bet it will nonetheless become a big deal within a few years. Nvidia is in a prime position to benefit from all of these trends.
I have no doubt whatsoever that the shift from cash to digital payments will continue. Block's Square and Cash App ecosystems will almost certainly be much bigger in 2030 than they are now.
My prediction is that the adoption of telehealth and virtual care won't be a pandemic-fueled flash in the pan. The convenience to patients and cost advantages to payers won't go away. Despite its atrocious stock performance, I think that Teladoc is still the most likely to succeed in the virtual care market. If you don't think the company enjoys a moat, look into why Amazon decided to scrap its telehealth plans with Amazon Care.
A better tomorrow
I especially like two quotes from Warren Buffett's mentor, Benjamin Graham. Graham wrote, "In the short run the market is a voting machine, but in the long run it is a weighing machine." Many are voting against quite a few of the stocks that I own. But it's the "weight" of their businesses that will matter in the end.
Graham also said, "To be an investor, you must be a believer in a better tomorrow." That strikes me as a profound and true statement. To believe in that better tomorrow, you have to look beyond the dismal today. And that often requires holding onto stocks that are temporary losers in wild markets like this one but that could be big winners over the long term.
