After a couple month hiatus I want to get back on track with net worth updates. Several things have transpired both in Mr AVIs personal life and world in general since my last formal post back in Feb of this year, which I will get to in a bit, but for the first order of business for this blog: net worth updates. So without further ado, here are the key metrics:

• Net Worth (as percentage of FI number): 146.54
• Accessible Net Worth (as percentage of FI number): 82.23
• Liquid Assets/ Debt Ratio: 5.182
• Cash Balance/Two Year Living Expense Ratio: 0.66

And the table highlighting the change in net worth in the last two months:

A few points worth  note:

• Net worth hardly budged relative to where I was at the start of month in March. As noted in my brief commentary for the month of March (see below), market bounced back in March wiping off all the losses incurred in the first two months, only to give it all back and then some for the month of April. Net result, net worth pretty flat.
• Interest rates have gone up quite rapidly in anticipation of impending rate hikes and hawkish FED outlook. With that mortgage rate have also gone up, almost doubling from where we were at the start of the year. One would have expected slow down in housing stats, but as can be seen from sample-size of one– Mr AVI family residence– home price increase is not showing any sign of slowing down.. up ~6.6 percent in the last two months
• I have been aggressively plowing funds into the markets, not to mention the huge tax bill that came due earlier in the month! Net result my cash balance has gone down significantly but still not aggressive enough draw down to reach my ideal is to have cash balance/two-year living expense ratio to be 0.5.
• On the liability side of the equation, I am making healthy progress in paying down mortgage on our primary residence. As I have mentioned several times in the past the liability is small enough for me to have complete freedom to get rid of any time of my choosing.

With net worth updates out of the way, lets get back to commentary of the events that have transpired in the last couple of months.

Month of March

I cannot imagine any field of human enterprise where laziness can be considered a boon for productivity except for investing! Month of March was offered a great exhibit for the virtue of doing nothing! The markets (S&P 500) rose 3.6 % for the month, offering some relief from the painful correction that we have witnessed since the beginning of the year in which stocks had dropped as much as 13 % from all time highs!

The month produced best weekly gains since Mar 2020 with S&P 500 notching a 6.5 % weekly gain and the tech-heavy Nasdaq Composite advancing 8.1 %. Chinese stocks saw a massive surge, with the golden dragon index rising 33 % on Wed Mar 16th, the most since atleast 2001 after Chines regulators vowed to keep markets stable. Alibaba (ticker: BABA) rallied 37% on that day, in its biggest gain since the company started trading in US in Sept of 2014.

All of this after the gloom and doom scenario bombarding screens all around the world, which was hyper-focused on the tragedy that is unfolding in Ukraine. The month of March was also a reminder in the futility of focusing on macro events to guide investment decision.

On a personal note, travels were in the offing for me in the month of March. I was in India for two weeks, finally making a trip to visit parents, which was long overdue! Travel to India and then back was quite adventurous. My booking, United Airlines direct flight to Delhi from San Francisco, was canceled on the day of, courtesy, Ukraine war. Luckily for me, I was able to find ticket on Qatar Airlines (paying business class to travel economy). On my way back, I had a harrowing experience of emergency landing in Karachi, Pakistan! (see here, here and here ). Suffice to say, it was a trip to remember!

I also made a family trip to Victoria Canada! Unlike the harrowing experience of India trip, this was the most pleasant trip to a beautiful Canadian Island city! Here are a couple of gorgeous photos from the trip:

Month of April

April could not have been more different than what transpired in March. On the last day of trading, DOW tumbled 400 points and Nasdaq dropped 4 % to close out a brutal month for the markets. For the month of April Nasdaq dropped ~13 % to close out a worst monthly performance since October of 2008. S&P 500 dropped 8.8 %, worst monthly drop since March of 2020. 

It was a month of reckoning for majority of FAANG stocks. Netflix posted its worst quarterly results with net loss in subscriber numbers for the first time ever, resulting in stock dropping more than 20 %. On Friday Amazon missed earnings and the stock dropped 14 %, its biggest drop since 2006. Apple dropped 3.7 % post earnings and Intel dropped ~7 %.

Facebook offered some reprieve with CEO Mark Zukerberg hinting at curbing expenses on its Reality Labs venture. The stock rallied almost 18 percent after Meta posted an earnings beat for the quarter. This rally was not however sufficient to prevent S&P 500 from posting the third worst draw down for the first 4-months of the year.

The chart below summarizes the woes of 2022, and its impact on AVI family net worth, which is down ~5 % for the year!

Also the end of month marked the wood-stock of value-investing event, the in-person annual Berkshire meeting! My take on the meeting will be the topic for next post.

Amidst the route of tech, I initiated two new positions, AMZN and NFLX, which also will be topic for next post.

Video/Book/Article

• Book: The 7 most important equations for your retirement, by Moshe Milevsky. Fascinating read for math minded folks interested in personal finance and history!
• Podcast: The eternally green, Mohnish Pabrai, at Harvard Business School Investment Conference
• Berkshire Annual Meeting
• Chart: 50 cognitive-biases