October 1st was the first trading day of October. Nvidia was the top performing stock of the S&P 100 over the previous six months from April through September. Therefore, I held the four shares which I previously bought on September 1 for $225.79 each for a total of $903.14. I also held $36.24 in cash which equaled a grand total of $939.38. This equaled the amount of the proceeds from the stock I bought and sold in August, Capital One Financial (ticker: COF) along with the cash I held in August.
On October 29th, the last trading of that month, Nvidia (NVDA) closed at $255.67 so my four shares were worth $1,022.68. Add the $36.24 in cash to that amount and the grand total was $1,058.92 through the first six months of this trading strategy.
I started with $1,001.66 on May 3rd. So over the six months, this modified strategy is up 5.7 percent. Over that same time (May through October), the benchmark SPDR S&P 500 exchange traded fund (SPY) went up from $419.43 per share to $459.25 or 9.5%. Therefore, our strategy is underperforming against the market index through October.
On the other hand, this first week of November has been good for NVDA shareholders as its stock closed at $298.01 yesterday, November 4th. This price brings the portfolio value to $1,228.28 ($1,192.04 in stock plus $36.24 in cash) which translates to a return of 22.6 percent over six months plus one week. SPY closed at $466.91 yesterday which equals 11.3 percent over the same time. Therefore, the strategy is currently outperforming the benchmark index from May 3rd through November 4th.
The Top Stock Three Months in a Row
Nvidia Corp. has done really well over the last six months and has been the top performing stock in the S&P 100 index in August, September and October. In fact, the stock price doubled during that time.
Why is Nvidia doing so well? If you recall from the last post, Nvidia is the leader in computer chips used for graphics and artificial intelligence. And both of those applications will factor heavily in developing the metaverse.
The metaverse is a wide virtual reality network currently being planned by the big technology firms. Just last week, Facebook (FB) announced that it changed its name to Meta Platforms Inc. It also announced that it will be spending billions of dollars in building its metaverse. And Nvidia will be one of the key players in the build-out of this new technology.
Check back in about four weeks to see if Nvidia is still the top stock for four months in a row or if Tesla or Ford has replaced it.