Despite his enormous wealth from real estate and other deals Donald Trump may not be the best example for all investors to follow in terms of portfolio selection. With his recently released Public Disclosure Report (required of the Presidential candidates) we get a peek into “The Donald's” stock portfolio, and it's not pretty.
Donald Trump, the Presidential candidate and real estate mogul, has been saying the stock market is a disaster for close to five years, which nearly matches the entire length of the current stock bull market. Anyone who has listened to him has been grossly disappointed as the major indexes like the S&P 500 and DJIA are up 90% and 68%, respectively over the same time frame. This extends across most of Trump's stock market dealings as well. Even this month, he said we're in a “big fat economic and financial bubble like you've never seen before.” Will he be right this time? After being wrong so many times before?
I believe there are a number of reasons why you just shouldn't listen to Trump when it comes to your stock portfolio:
No. 1: Trump isn't a stock picker
As part of the whole running for President scheme, Trump had to release his net worth and assets to the public. With that, we got a look into the portfolio management skills of the Donald.
In truth, Trump might not be a stock picker at all. Trump has a knack for sticking to large Dow component stocks, which, for a financial renegade, is a bit boring.
And for a man that has no faith in the financial system, advocating decreased regulation, he certainly has enjoyed the fruits of the rebound in banking. Bank of America (NYSE: BAC) is by far his greatest stock market winner.
We don't know exactly when Trump bought his stocks (that's not disclosed on the form), but we can tell by what he owns that he's in for additional pain.
He owns shares of the troubled tech giant IBM (NYSE: IBM), which is down close to 17% over the last twelve months. IBM will continue to struggle as it loses market share, while also proving too big, with a $160 billion market cap, to meaningfully pivot to a faster growing market.
