The “Skin In The Game” Portfolio

Before you continue reading I  want to emphasize that the portfolio below is no recommendation to buy or sell the mentioned securities. I’m no investment advisor. Please do your own due diligence.

(Two other portfolios are in the pipeline: The international dividend portfolio and the “compounding” portfolio.)

Below you find my picks for a “skin in the game” portfolio, companies controlled or owned by insiders or a family. These owners have a real passion for their business and are not afraid of working outside normal office hours – they are not working for the paycheck. I prefer to call such companies owner-managed or owner-operated: they both own and manage the business at the same time. To avoid the agent-principal conflict, I believe it makes sense for outside investors to invest alongside owner-managers/operators. A lot of empirical evidence points toward outperformance for this group among public companies. I have previously written an article why these stocks make sense to invest in.

The goal of the portfolio is fourfold:

  1. To construct a portfolio where the interests of the management are aligned with outside investors.
  2. Companies are financed relatively conservatively and thus less fragile.
  3. To get a return equal to or better than the main indices.
  4. To have a very low portfolio turnover, probably just a few deletions/additions per year, if any at all.

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This is a very long-term portfolio: decades. At 31st of December the portfolio is rebalanced back to equal weighting. Any dividends are reinvested in the same stock. Currency movements are ignored as it depends on your place of residence, wherever that may be.

Here is a list of the companies included in the portfolio (start of the portfolio was 1st of September 2020):

Return %
Date Buy Price per (not including
Ticker Exchange included price 28th of September dividends)
Admiral plc ADM.L London 31.8.2020 2631 2652.15 0.8
Alleghany Y NYSE 31.8.2021 554.56 517.86 -6.6
Berkshire Hathaway BRK.B NYSE 31.8.2022 218.04 213.54 -2.1
Brookfield Asset Management BAM NYSE 31.8.2023 33.74 33.46 -0.8
Coloplast A/S COLO-B.CO Copenhagen 31.8.2024 1063 980 -7.8
Comcast CMCSA Nasdaq 31.8.2025 44.81 46.76 4.4
Facebook FB Nasdaq 31.8.2026 293.2 256.82 -12.4
Bouvet BOUVET.OL Oslo 31.8.2027 586 584 -0.3
Investor AB INVE-B.ST Stockholm 31.8.2028 553 589.4 6.6
Kone KNEBV.HE Helsinki 31.8.2029 72.44 75 3.5
L’Oreal OR.PA Paris 31.8.2030 279.8 278.6 -0.4
Lukoil LUKOY OTC 31.8.2031 67.23 58.32 -13.3
Philip Morris PM NYSE 31.8.2032 79.79 76.31 -4.4
Samsung SMSN.L London 31.8.2033 1150 1258 9.4
WR Berkley WRB NYSE 31.8.2034 62.05 61.62 -0.7

Below you find my reasoning for including the stock in the portfolio:

I will most likely cover the other stocks in later articles.

Disclosure: I’m long Alleghany, Berkshire, Comcast, Facebook, Investor AB, Kone, Lukoil, Philip Morris, Samsung and WR Berkley.

I am not a financial advisor. Please do your own due diligence and investment research or consult a financial professional. All articles are my opinion – they are not suggestions to buy or sell any securities.