all right so hi guys in part one of this

video I talked about uh what were the

best performing stops that contributed

to the majority of the Gams of my

portfolio for 2024 where my portfolio is

up about 28% year to date so my best

performing stocks as I mentioned uh were

palena Nvidia meta platforms foret

service now broadcom booking Amazon and

Salesforce so now in part two let me run

through my worst performing stocks in

the portfolio so the worst performing

stocks

uh are EST order down

45% uh Celsius down 30% Nike down 23%

elep Health down 15% and lvmh down 12%

and there actually another stock that

just Dro and it's also one of my worst

performers that I didn't include in the

newsletter at the time which is

evolution AB which is a casino B2B

operator so let me show you in my

portfolio right here yeah there we are

so evolution is down up over 30% as well

for me this year and then I've got Estee

Lorden Nike elvans and Louis Vuitton so

these are the worst performers that have

kind of like contributed to dragging

down my portfolio but of course the

winners have far outpaced the losers and

so the portfolio is uh well above the

S&P 500 this year so the first thing to

understand is that no matter how strict

you are as an investor where you only

pick very good companies that meet your

investing rules

guess what not every stock will

perform right off the bat yeah yeah

there are some stocks where the moment I

buy it flies up in the next one month 6

months one year it's up like 50% 100%

right but there are also many stocks

that I pick which are great companies

that meet my investment criteria that

don't perform initially when in fact

initially they may first go down they

underperform initially but later they

they may outperform okay it's kind of

like me okay um I'm 50 years old this

year and I can tell you that when I was

uh a teenager before 13 years old I was

a terrible student I was like failing

all my exams my teachers told my parents

your son is hopeless Adam is lazy he's

stupid he's he's an idiot right and I

got into one of the bottom three

secondary schools in Singapore high

schools because I did really badly for

my primary exams you know so I was a

very late bloomer

but then when I was like 14 15 I woke up

I started studying very hard and

eventually I did very well in school so

like stocks some stocks are late

bloomers when they first start they look

like but they could turn out to be

big Winners later on you know and I'll

give you an example right like you know

palente here when I first bought palente

here at $11 in fact I started buying it

at about $10 then I bought a bit more at

11 I average up right and let me show

you my my palent here for example so

when I first bought bought it I bought

it

uh somewhere here right I bought it at

about 11 yeah 11 to $10 bought it here

and after I bought it guess what it

didn't perform immediately in fact for

the first few months from $11 it dropped

all the way to $5 so initially my

balante was down 50% now can you imagine

if I gave up and said oh this is a

horrible piece of I get get rid of

it you know today I'll be kick myself

right because today paler is $84 so the

good thing was I held on to it because I

I like the business I said the business

has got no debt the business got great

growth potential I like the product you

know so the short-term drop in the stock

price was to me very emotional it was

because of the bare market and I knew

that eventually once the bare Market was

over and sentiment changed people would

value the business uh differently right

and so right now my palenta as I

mentioned in part one of the video is up

uh close to eight times my money but it

started as a loser before it became a

winner so you have to be very careful

when you first invest in a great company

which is a great business and the price

may drop initially 10 20 30% it doesn't

mean that it's a bad investment it

doesn't mean you made a mistake because

sometimes the price drops the price

dropping has nothing to do with the

company it's a good company it's growing

it's making money sometimes the price

drop is purely based on manipulation and

and on emotions and on sentiments so if

you know that the company is good ignore

the shortterm drops in fact take

advantage of it by buying more and

you'll be well rewarded right but of

course if the price drops because the

company is a crap company is losing

money it's not doing well then yes then

we got to cut loss we got to get out so

ultimately whether we sell a stock

should not be based on what the price

does because the price is shortterm it

is based on the the business is the

business growing is it making money is

it does it have a long Runway All right

so with that in mind let's run through

the worst performing stocks and again

like I said no matter how uh strict you

are as an investor even the great Warren

Buffett he does have stocks that that

underperform not just in the short term

that in the long run they never ever

perform well and I do have stocks like

that as well we will get some duts and

lemons along the way all right and but

the thing about investing is this you

know you know some of my students when

they buy a stock like a Nike estate

order which I own and it's down 20 30%

they get upset oh you know I I made this

lousy stop it it's down 20 30% all that

and what I want to tell you is that as

an investor you know don't think of it

at a stock by stock level okay but think

of it at a portfolio level okay and

that's why I tell people that when you

invest in stocks you have to invest in a

a minimum minimum of at least 10 great

companies now you can go more than 10

right but at least 10 great companies

because out of the 10 stocks you buy you

never know which ones will become a

palente here you never know which ones

will become an Nvidia up up 10x you know

or up even more by the way in part one

of the video recall I shared with you I

first bought Facebook at $19

right and now Facebook which is called

meta is $600 so from the time I bought

it at $19 to today's $600 that's up like

31x now of course yours truly ADM coup

was not so smart to hold it from 19 all

the way to $600 as I shared with you on

part one of the video I sold it at $50

thinking I was so smart but looking back

I was a complete idiot if I held on to

it it' be a 31 X but no I had to sell it

at $50 and I bought it back at a higher

price and I sold it again I went in and

out in and out so yes I made a lot of

money on matter I have but I could have

made probably 10 times more if I had

just bought it and just held on to it

you know so again the lesson is once you

find a great company you got to hold on

to it like I said earlier on when you

buy a portfolio of 10 great companies

over time in three five years or even 10

years of holding this portfolio there'll

be some stocks that will go up 10 times

like palena Nvidia and some stocks like

meta when I first bought Facebook like I

said $19 it's up like 30 times right so

you got some stocks going up 10 times 30

times some go up only two times those

suck some go up three times some go up

five times but again there'll be some of

them that even after three five years

they may not work out right some of them

in the long run uh now I would say it's

almost impossible for a stock to go to

zero okay if you buy a good company like

could uh McDonald's go to zero could um

Pepsi go to zero I I doubt it now if you

went to zero you'll be minus 1X right

which is very very improbable okay but

let's say it happens okay so let's say

of 10 stocks three of your stocks go to

zero which again it's almost impossible

but let's say it happens now even if

three stocks go to zero that means out

of the 10 stocks three of them are down

1X each right does it matter it doesn't

matter because all you need all you need

is one Nvidia or one paler that will go

up 10x or one Facebook that goes up 30X

they will make up for a lot of the ones

that go to zero of course like I said

the reality of a good company going to

zero is is almost impossible but even if

it goes to zero you'll still do very

well if you let your winners run because

they will offset the underperformance in

your portfolio so having said that what

are my underperformance for 2024 so

first we sale order and this has been an

underperformer not just this year but

last year as well I've been holding it

for a couple of years so since I bought

Este order and I bought it before the

pandemic uh it's down like over 60% uh

in my portfolio Okay uh yeah and then

Nike I just bought it this year my Nike

is down like 20% from the from the time

I bought it El Health

um I've held it for quite a while but it

dropped this year and I'm down like 14%

on elan's health lvmh I'm down like 9%

but uh Evolution AB which is a casino

B2B operator and

salus uh which I I I added this year I'm

down about 30% on both okay so again at

the end of every year I will review my

underperformance and then I'll ask the

question should I cut loss or should I

hold it or should I even buy more now it

all depends on the reason for the

shortterm underperformance of the stock

price so the first question that I

always ask is that why did the share

price go down was it because of non

company specific reasons so sometimes

the share price of a stock goes down

it's got nothing to do with the company

it's because of some macro reason like

maybe there's um announcement of the

rise of interest rates or the GDP was

not as good as expected or inflation

data was not very good or sector

rotation or correction of B market so it

is not specific to the company so when a

company's share price drops because of

non company specific reasons then it's a

no-brainer so for these situations I

just will buy more if I don't yet have a

full position right now then if the

share price drops because of a company

specific reason then the question I'll

ask is that is it a short-term reason

that affects the company in the short

term or is it a long-term structural

problem so what are examples of

short-term issues examples would be when

a company misses their earnings

estimates or they lower their forward

guidance a good example recently would

be Adobe where they actually beat on the

earnings but they slowly sorry they

slightly lowered their forward guidance

so to me that's no big deal because it's

a short-term issue right or even asml

asml they kind of like Miss on their

earnings and they lower their forward

guidance same thing so these are

short-term reasons that that uh don't

bother me so I would I would hold or in

fact buy more if I don't yet have a full

position next reason and could be

related to the first reason is when

there's a cyclical slowdown for the

demand of products and services so let

me give you a good example if you look

at cyber security companies like

foret and Pala Alo so I've got quite big

positions in the these two companies now

what happened was about a year or two

ago there was a Slowdown in the demand

for cyber security services as a result

their share price dropped quite

significantly and when that happened I

bought more shares why because I knew

that in the long run companies would

spend more on cyber security so the

long-term growth is definitely there but

it's just that it doesn't go up in a

straight line in the short term it goes

through sometimes uh slow downs and

acceleration cycle so when cyber

security slowed down last two years

shortterm I use it to buy more cyber

security

companies so the same thing is with

companies like asml and in fact many

semiconductor companies that are not AI

directly AI related so those that are

directly AI related like Nvidia there's

no slowdown it just flies right but look

at for example asml AMD or Micron they

make a lot of Chip

that are not just for AI they make a lot

of non AI chips as well and those are

more cyclical so right now that part of

the semiconductor business is going

through a psychical slowdown but again

it's shortterm because in the long run

the demand for semiconductors even the

non AI ones would definitely be uh still

there okay so salus is a good example if

you ask me so Celsius is in the energy

drink category healthy energy drinks so

the question is re recently there was a

Slowdown in the growth is it a

short-term slowdown or is it a long-term

slowdown in my opinion it's a shortterm

Slowdown in fact a lot of the energy

drinks are experiencing slowdown in

demand whether Red Bull or Monster or

CSUS in fact salus is taking market

share from Red Bull and Monster all

right so short term they're all slowing

down but long term will there be still

that demand for energy drinks I think so

I believe so so because of that to me

again Celsius falls into the short-term

problem category not the long-term

problem category

right another short-term company

specific problem could be the major

shareholder is forced to sell stock for

whatever reason which is uh none of my

stocks are in that category right now or

sometimes that could be purely

manupulation by market makers or alos uh

temporary bad news caused by product

recalls uh lawsuits by the government

uh sex scandal you know what kind of

Scandal right but I mentioned before

that if it is an accounting Scandal I

would sell immediately like smci is a

good example when it's accounting

Scandal I won't touch it by the way I

never own msci and I if I did own it

I'll get out immediately because

accounting scandals are scary if you're

old enough to remember Enron and

Worldcom they can they can cause the

company to go to zero so no thanks I'm

out right but sex scandals are fine

right because can always change the sex

of the person I'm just kidding right so

a good example would be Evolution AB

which I

own and uh so evolution is the largest

B2B Casino operator so they sell their

services to uh online casinos and

recently the UK gaming Authority kind of

like uh

investigating the fact that Evolution

allowed their games to be used on

websites that was not licensed by the UK

so because of that that it's not really

a lawsuit but the investigation caused

the stock price to drop significantly

and to me I personally have no worries

because the company is doing very well

company growing revenues and profits a

high dividend yield and these kind of

temporary bad news would be sorted out

eventually right so for evolution in

fact I've been I I bought

more uh a couple of days ago right now

next would be management

missteps so sometimes s uh the

management screws up and that's the case

with Nike so Nike they had a CEO called

Donna Hugh who came in uh over the last

two years ago and he really screwed up

Nike because he cut out all the

middleman all the Distributors like Foot

Locker and and and those Distributors

and they sold direct to the consumer

DTC and that was a strategic error

because when Nike was no longer having

shelf space in those stores competitors

like Hoka and on they took up the shell

space and they took some market share

from Nike and to make it worse Nike got

rid of a lot of their product experts

like their football experts their

basketball experts so that caused

Innovation to decline at Nike so Nike is

a clear example of management missteps

now the thing about management missteps

is that it's a short-term issue but if

it's not resolved and the management

doesn't change it could become a

long-term

issue so for cases like

this like Nike where they just fired

that that CEO and they got back then

they got a new CEO OT Hill who's an

Insider uh there's a high chance he

could turn it around okay but you never

know he may not be able to turn it

around so there's a bit more risk there

so in cases like that where there's

uncertainty could they turn it around

then I would be careful I would not add

more aggressively I mean add a bit more

but I'll hold and see until I see the

results coming in their revenue re

accelerating then I would buy more but

at this stage I'm still watching to see

if the new CEO can indeed turn around

their revenue and their profits okay how

about estate order now estate order is

the one that's down the biggest for me

it's down over 60% although it's a very

small position now estate order is a

combination of macro reasons and

management missteps so what's the macro

reason now estate

order before the pandemic 40% of their

business Walks from China

40% so as a result of the

pandemic and the Management's missteps

in their supply chain

management as well as the Chinese

consumption collapsing because of

China's going through a severe recession

estate order 40% of their business has

got hit significantly because of China

all right so it's a combination of the

China problem and the management

missteps and as a result if you look at

estate order they have a significant

drop in their revenue and their profits

okay so you can look at this is EST

order their revenue you can see drop

significantly their net income drops

significantly and their operating income

drops sign signicantly so when you see a

company where they are sales and profits

drop for more than 2 years or it has

dropped more than

25% then I call that a turnaround

situation so for cases like this would I

add more shares no I won't I won't add

more shares until I can see their

revenue or profits showing signs of

quarterly

reacceleration okay so in the case of um

estate order uh now I'm thinking should

I sell estate order okay so the question

is do I think that China would make a

comeback I think it would make it would

not make a comeback to where it w where

it once was pre pandemic and uh pre the

the Crackdown but I do think it will

rebound better than where it is today so

as a result that for EST La I am not

selling because I think I'll wait for

the rebound that slight Rebound in China

okay to eventually get out but long term

I'm not holding estate order because

again a big part of their business is in

China where in the long run I'm not too

optimistic about China and again can

they turn this around we don't know yet

we I'm we are watching to see if they

can do it by the case of Nike for

example although the CEO Donna Hugh

screwed up the company even though he

screwed up big time but their revenues

are still growing their profits are

still growing so it's not that bad so

for Nike I would be inclined to maybe

add a bit more but not aggressively

until I see again Elliot Hill being able

to re accelerate their market share yeah

and like I mentioned in the case of

Celsius to me Celsius is not really a

company specific misstep I think the

company's doing a great job it's more of

a macro issue where it's a slow down in

all the energy drinks and I think their

slow down is more cyclical than

structural and if you look at salus is a

relatively new company it's a

speculative Growth Company and uh yep

you can see the huge growth in revenue

and um profits but there was a quarterly

pullback which I think is a short-term

issue for that reason I'm not just

holding Celsius I'm adding to it in fact

just added more shares uh just before

Christmas okay next elv health so El's

health I'm down like about 14% on this

position it's a a relatively small

position now why did elant help

underperform well there are three main

reasons and they are mostly macro

reasons that are not within the control

of the management so the first reason is

that overall Healthcare companies tend

to not do as well on election year so in

fact in 2024 most Healthcare companies

whether Pharmaceuticals medical devices

managed healthcare companies they all

have underperformed so it's not a

company specific issue it's a sectorial

issue which by by the way I believe that

next year 2025 Health Care would uh come

back strongly all right so that's the

first reason second reason is the

negative sentiment caused by the

shooting of the CEO of United Healthcare

by um Super Mario's um friend Luigi

right so again that's more of a

sentiment short-term issue that would

blow over uh over time okay now the

third reason which is a bit companies

specific but again more of a macro

reason is because elephants Health they

had a drop in their last quarter's

earnings because of the drop of

enrollment of the number of Medicaid

members and the reason the membership

dropped is because of the unwinding of

the covid continuous enrollment

provision so what happens every year uh

Americans they have to be they have to

qualify to enroll IM medic K which is uh

medical insurance for the uh for people

with less resources in the

US and what happened was in covid the

government had a provision where

companies like elepant heal they were

not allowed to disenroll people they had

to keep them on the insurance program so

that artificially inflated the numbers

in covid but now that Co is over many of

the people in Medicaid no longer qualify

so because of that there was a drop in

enrollments in the last quarter and that

reduced their earnings slightly all

right number one number two there was

also an increase in the cost of these

insurance

companies because of the uh people going

for elective procedures that they put

off during covid and again this doesn't

just apply to elevant health it applies

to all the health insurance company so

because of that higher cost because of

elective non-elective surgeries

uh drop in Medicaid cause the short-term

drop in their earnings and Medicaid

enrollment so again the question is is

this a short-term issue a long-term

issue to me is a short-term issue and uh

shortterm issue I'm holding right and so

no worries in the long run and you can

see again the revenues are still growing

and although the profits and the cash

flow they have dip slightly but it's not

a very significant dip so I don't have

really much issues on elant health as a

good long-term investment so I'm holding

this one right next lvmh that owns your

Louis Vuitton and many many other brands

uh now for

lvmh uh again they so the share price is

underperformed more of a macro reason

again China so I mentioned that 40% of

Elan sorry not 40% of EST ERS business

is China lvmh not as high but still

significant so about 30 % of their

business comes from China and again we

know China slowed down they're not

spending as much on luxury goods so that

kind of like pull down uh LV mh's uh

sales and revenues well not really

pulled down you can see the revenue is

still growing right they still growing

Revenue they're still growing their

profits although there was a slight drop

in

their uh free cash flow but their net

income is still growing so in terms of

the numbers Revenue still growing

earnings are still growing I'm not too

concerned again shortterm slowdown

because of China again shortterm or

long-term to me it's more of a

short-term thing so lbmh clearly holding

long run I'm still U pretty optimistic

about this very very strong brand okay

finally Evolution AB so Evolution AB is

a French company that's the biggest B2B

Casino operator where they sell their

services to other online casinos and as

I mentioned earlier if you look at the

actual

Revenue the revenue is growing very fast

profits are growing very fast very

little debt a lot of cash so it's an

excellent company right to me personally

I think it's a great company the only

reason it dropped uh recently quite a

bit is because uh the UK gaming

Authority is not

investigating uh Evolution for a

allowing um non-licensed websites to use

their service all right so there's a

fear that what if they lose their UK

license now first of all UK only

accounts for 3% of their revenue so even

if they lose their UK license which is

very improbable at the very most they

get a 3% hit but that's not going to

happen right so to me uh this again lies

in one of those issues that are

temporary uh lawsuits or or product

recalls and stuff like that so as a

result for evolution I'm holding and in

fact like I mentioned I just added more

before Christmas so again this is not a

recommendation this is not an advice for

you to buy these shares or to hold these

shares this is just sharing with you my

thought process what I do every year at

the end of every year I look at my

portfolio I say okay which were the big

Winners why were they winners will they

continue to grow in the future if they

have a long Runway if they're still

growing if they're still great companies

I'm holding them and in fact adding more

if they retrace in the next year for the

ones that have underperformed again I

analyze them and I ask my this question

are they still great companies if

they're not I get out I cut my losses I

reinvest it but if they're still great

companies and the reasons are

shortterm then I'll hold them and in

fact even add more I do hope you found

this video educational and entertaining

and useful and by the way if you want to

meet myself bang fan and Alon Chu live

in person and get our outlook for 2025

do join us at the Outlook 2025 event

live at Marina Bay SS in Singapore it's

a full day event from 9:00 a.m. to 6:30

p.m. on the 11th of January on Saturday

so I'll leave the link in the

description below where you can click

the link to find out how you can grab

our tickets for this once a year event

so that may the markets be with you and

I'll see you guys next year