Here’s what I’ve been buying in my Stocks and Shares ISA
Investing in a Stocks and Shares ISA makes a lot of sense for me. It allows me the freedom to pick which stocks I want to own, while also protecting my investment gains from taxes.
Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.
My plan with my Stocks and Shares ISA is to invest each month and look for a couple of really great investment opportunities. Over time, that builds a diversified portfolio of stocks for me.
Since the start of the year, the S&P 500 has declined by around 21%, while the FTSE 100 is only down 6%. As a result, I’ve been looking for bargains among the fallen US stocks.
I think I’ve seen a couple of attractive opportunities for my portfolio in the last week or so. Here’s what I’ve been buying for my Stocks and Shares ISA this month.
First, I’ve been buying shares in Disney (NYSE:DIS). The Disney share price is roughly where it was at the start of 2015.
I think Disney is a much better business than it was in 2015. It has a bigger content library, which I see as its main competitive advantage, and it is establishing a strong position with Disney+.
Noting that the share price is where it was in 2015 isn’t quite a fair comparison, since the company now has an extra 7% more shares outstanding. It also has more debt than it had seven years ago.
I’m seeing the recent share price drop as a great opportunity to invest in in a great company that has endured for ages and will continue to do so. That’s why I’ve been buying the stock for my portfolio.
I’ve also been buying shares in Citigroup (NYSE:C). Warren Buffett was buying the stock earlier this year and I’ve been adding to my investment in my Stocks and Shares ISA as the share price has been coming down.
There are a few risks with this stock. The threat of a recession, the ongoing restructuring of the business, and the prospect of losses from its Russian exposure all count against the company at the moment.
Citigroup is making good progress through its reorganisation process, though, and management expects the company to be more efficient as a result. The real attraction of this stock for me, though, is the price.
The stock is currently trading at around 50% of the underlying company’s book value. While there are some significant risks to be aware of, I think that the stock is too cheap for me to ignore at the current share price.
The post Here’s what I’ve been buying in my Stocks and Shares ISA appeared first on The Motley Fool UK.
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Citigroup is an advertising partner of The Ascent, a Motley Fool company. Stephen Wright has positions in Citigroup and Walt Disney. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.