This Robinhood Portfolio is already up 72% in 2021 // Portfolio Analysis

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Welcome back everyone. In today’s episode of Portfolio Analysis I’m going to unveil another one of the portfolios in the 2021 portfolio challenge.

Today’s portfolio is probably a lot more representative of the younger investors out there who want more excitement from their investments. The results of the analysis did turn out to be pretty interesting. But remember that our challenge contains some of the best, most timeless proven portfolios in the world so it will be fun to see how this modern GenZ portfolio stacks up against the competition.

UPDATED 2020 PORTFOLIO CHALLENGE RESULTS

Below is an updated dataset for the 2020 portfolio challenge. This data is from January 2020 thru February 2021.

2020 Portfolio Challenge Q1 2021 Update (PDF)Download

PORTFOLIO INTRO

A lot of people think this Robinhood, wallstreetbets situation is new but its not new at all. Wallstreetbets has been blowing up the financial system of years. Back in 2019 the user named 1RONYMAN spent a few days bragging on wallstreetbets about how he had discovered and new type of options spread (a box spread) that quote “literally cannot go tits up” and of course it blows up in his face and creates a 2000% loss. He managed to loss $300,000 worth of robinhood’s money even though his account only had $5,000 in it.

Then in 2019 we had the infinite money glitch when a user figured out how to turn a $1000 account into $1 million dollars of leverage.

Then of course in 2020 we’ve got the infamous GameStop short squeeze, where some observant reddit users discovered unethical short interest in GameStop and exploited it by flooding the market with OTM call buyers to which did end up triggering a massive squeeze.

Anyways the point is that there are a lot of brilliant, and mischevious people on wallstreetbets and up until this recent debacle the majority of them used Robinhood to do their trading.

Robinhood used to provide an API you could call to gather all kinds of data about the trades iccuring on their platform and people in the know began using this data to front-run the reddit traders. It was a super profitable edge and it really sucks it not available anymore.

So in honor of RobinTrack.net (and other robinhood data aggregators), for our 2021 portfolio challenge we are going to include a Robinhood portfolio. Its probably gonna get killed since we are basically just guessing now but here how I picked the stocks.

I headed over to Robinhood and grabbed their list of top 100 most traded stocks. I picked the top 10 stocks as of January 2021 though I did end up dropping some of them off the portfolio since they did not have a full year of returns to track.

So here’s the 2021 Robinhood Retail Portfolio:

  • Apple $AAPL
  • AMC Networks $AMCX
  • AMD $AMD
  • BlackBerry $BB
  • Facebook $FB
  • GameStop $GME
  • Nokia $NOK
  • Plug Power $PLUG
  • Square $SQ
  • Tesla $TSLA

BACKTEST RESULTS

Here is the performance data over the last 3 months; December 2020 thru February 2021. I added the ARK Invest ETF and the Vanguard 500 Index Fund for comparison. These numbers are absolutely insane. I can’t remember ever analyzing a portfolio that has had anything close to this level of risk. I typically recommend people cap their risk around 18 to 20% std dev. so I don’t even know how to react to 570% std.dev. Just imagine you are starting your investment journey in 2021 and in the first 3 months you’ve already had your portfolio cut in half!; how would you react to that drawdown? I think that might convince you that investing is for degenerate gamblers.

If we annualized this performance than this portfolio would return 1500% in excess of the index.

That’s just bonkers.

In any event, that’s your 2021 Robinhood Retail Portfolio.

If we take a sneak peek into this portfolios challenge results, as of today this portfolio is up 72% in 2021. We’ll just have to wait and see how well it stands up to all the other contenders throughout the year.

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Published by nealosis