Abstract: Explain the reasons of buying US stock Paypal (PYPL) and selling US stock Didi Chuxing (DIDI) and ARKG share my views.
Transaction detail
What I want to share with you today is the transaction I made on September 27. The details are as follows:
Bought stock
- Paypal Holdings Inc (US stock code: PYPL)
- Quantity: 5 shares
- Bought price: US$273.27
- Commission fee: US$0.35
Image source: https://seekingalpha.com/symbol/PYPL/chart
Sold stock
- Didi Chuxing (US stock code: DIDI)
- Quantity: Sold all
- Sold price: US$8.09
- Commission fee: US$1.72
Image source: https://seekingalpha.com/symbol/DIDI/chart
Sold stock
- ARK Genomic Revolution Multi-Sector ETF (US stock code: ARKG)
- Quantity: Sold all
- Sold price: US$78.27
- Commission fee: US$0.41
Image source: https://seekingalpha.com/symbol/ARKG/chart
Reasons for buying Paypal
Among the four financial stocks I hold, three traditional ones including Visa (US stock code: V), Master Card (US stock code: MA) and American Express (US stock code: AXP) have gained a certain increase recently. The remaining Paypal has recently followed the market sentiment to fall slightly. However, I think Paypal has a good long-term development potential. It can be seen that the company’s management has been very active in developing new types of business in recent years, and they said that Paypal will continue to launch new services in the near future. Here I just like to stress that for this kind of company that already has a very good business base and marketing leading position, but they are still striving for innovation and developing their business, I think this is just the correct choice for us investors to pick this kind of company to help us develop long-term value, so I am very confident in the development of Paypal.
Reasons for selling Didi and ARKG
The main reason for selling these two is to set aside more cash to prepare to increase positions in other more confident companies when the market declines again. In addition, because of the recent increase in positions of Alibaba (HK stock code: 9988), China Merchants Bank (HK stock code: 3968). In addition, it is expected that the Xiaomi (HK stock code: 1810) short put will expire tomorrow with a good chance to execute the purchase at HK$22. As the overall decline of Chinese stocks happened recently, I have increased a certain amount of shareholdings in my Chinese stocks so that my exposure to Chinese stocks is increased. Therefore, I decided to sell my Didi holdings for which I have less confidence in so as to balance my risk exposure.
In addition, I would like to summarize how much I have earned from the Didi stocks. Initially, I opened a short put option and collected the option premium of US$0.35 (see this article for details), then it was executed to buy at US$8, and then opened a short call to collect the option premium of US$0.45 (see this article for details), this short call was not executed, and then I sold at US$8.09, total earning is: (0.35 + 0.45 + 8.09-8) / 8 = 11.13%. About 2 months was used, if I was to sell at about US$9 during the period, I could earn even more, but you may hardly get the best outcome in most cases, and this return is already very good for me.
The reason for selling of ARKG is also similar. Although I believe that the future development trend of Genomic Technology is also very good, I still made the decision to reduce it as I think this is the way to invest in stocks. You must know the trade-offs and decide which companies you have relatively more confidence in, so different investors will be based on factors such as their background, profession, experience, research, etc to have different views on the development of different companies. At present, with regard to the stock price decline of Chinese stocks, I think that the four Chinese stocks I hold are relatively more in bargain and have a greater chance of rising in the future. Therefore, I decided to reduce the position of the stocks with less confidence now, so as to retain the funds. When the market sentiment weakens again in the future, I will be more capable of increasing the position of some more confident company stocks.
Comments and sharing
If you have any questions, please feel free to leave a message or comment below, I will reply you. Or if you find anything incorrect in the article, please let me know and learn from you. If you find it interesting or it may help you in any sense, please share with other people.
