February was a busy month to answer questions from our clients such as: “are stocks going down?”. The answer is YES for the markets, especially for growth stocks, and NO for our investments.

“But, Christmas’ Signature strategy tends to invest in growth stocks, doesn’t it?” 
From the chart above, growth portfolio — Nasdaq and ARKK — experienced worse return than the S&P. Fortunately, our top high-growth tech stocks produced positive return for our portfolio instead. They moved in contrast direction during the month, driving our overall returns into positive territory.

Most of the companies mentioned above reported better than expected revenues and/or earnings for Q4 and full year of 2021. Moreover, they are not just growth stocks but quality growth stocks. Datadog Inc (DDOG) for example, reported a strong 70.5% revenue growth for 2021 and the management projected another 48% revenue growth for 2022. Although still made a loss in GAAP-based net income due to stock-based compensation, DDOG produced positive adjusted EBITDA and free cash flow during 2021. Its current valuation is not cheap, but Investor should see the difference between quality growth stocks vs overvalued stocks such as companies in ARKK ETF’s portfolio which are sensitive to market downturn and macroeconomic issues. Statistics speak for themselves: “alpha generator” vs “beta generator” portfolio.

Looking ahead, I will be writing about the difference of alpha vs outperformance. Stay tuned.