Sold AXP, BRK.B, JPM, and WFC

posted Jan 19, 2021, 7:53 PM by Intelligent Investor
We sold all of our shares in American Express (AXP), Berkshire Hathaway Class B (BRK.B), J.P. Morgan (JPM), and Wells Fargo (WFC).

American Express (AXP) - We just do not want to be in the financial sector at this moment. The COVID-19 pandemic is hurting small businesses and many of American Express' costumers are small business owners. We believe over the long run, this company will do well. However, we are not sure if the stock will perform well in this economic environment. If we are not sure about something, we just sell it and take our profits. Even if our profits are small.

Berkshire Hathaway Class B (BRK.B) - Berkshire always does well during recessions. Recessions is where Berkshire acquires ailing companies and becomes bigger. We are probably going to regret selling this stock. However, we see a greater opportunity elsewhere and we need to raise cash.

J.P. Morgan (JPM) - This is the strongest bank in the world. They have a fortress balance sheet and out of all the banks in the U.S.A., this bank will survive the pandemic induced recession. This is a good long-term investment. The stock is significantly up since last year. However, Berkshire Hathaways sold all of their shares in J.P. Morgan and we do not know why. Part of our strategy is to simply follow Warren Buffett. We make an assumption, he sold all his stock in JPM for a good reason.

Wells Fargo (WFC) - This company has ruined their reputation...big time! They also cut their dividends! Berkshire Hathaway has also sold a lot of their holdings in this stock. We are worried. If we are not sure, just dump it.

In summary, we need to raise cash because we see an opportunity elsewhere, we also do not want to be in the financial sector at the moment. We also believe that there is a possibility of some Disruptive Technology going on in the financial sector due to the likes of PayPal, Venmo, Amazon Pay, Apple Pay, Facebook Pay, and Square. These payment services are currently small, however, we see them growing exponentially in the future because they are much more "superior" than a checking account.

Disclosure: We do not own shares in American Express (AXP), Berkshire Hathaway Class B (BRK.B),  J.P. Morgan (JPM), and Wells Fargo (WFC) anymore.