The 2019 Fantasy Investing season is underway and we’ve already had a fast start out of the gate with a few portfolios already seeing double digit gains. If only I had decided to start the Freedom Portfolio now instead of 3 months ago…

The hope is to have monthly check-ins where I report on the current standings and a few thoughts on how the race is shaping up. In the meantime, I thought I should reveal my own 2019 Fantasy Investing portfolio and provide some thoughts on why I chose the companies that I did.

Go team TAMIS!

With the letters M, A, T, I, and S as the first letters of the stocks in my portfolio, it really seems like I should be able to come up with some clever name, but there doesn’t seem to be one. TAMIS at least seems like it should be a thing (and apparently it is a kitchen utensil), so that’s what I’ll go with for now, but I am very open to better ideas. So if you have any better suggestions, please hit me up in the comments. In the meantime, here’s some thoughts on my picks, in alphabetical order:

Amazon (AMZN)

I’ve already written a lot about why Amazon is the largest holding (and only Babylon 5 level position) in the Freedom Portfolio, so this might be a short recap as I’ll try not to belabor those points any more. Instead, I’ll just point out that I liked the company at over $2,000 a share around 3 months ago and I absolutely love it now at around $1,600 a share after it has lost around a quarter of its value. I didn’t think their third quarter earnings report was bad at all and they reportedly had a record breaking holiday season. I fully expect Amazon to revisit the $1 trillion market cap club in 2019, but even if it doesn’t and there continue to be some speed bumps, I love this company for the long term and not even a Bezos divorce can shake that.

iQiyi (IQ)

I also previously wrote about iQiyi and mentioned some of the moves that I made in the recent Freedom Portfolio check-in. In the less than one year since it IPO’d, iQiyi has been as high as $46 a share and as low as $14 a share. On some level, I understand how investor sentiment around the stock could swing so wildly (especially with concerns over a slowing Chinese economy and continuing trade war with the US), but changing investor sentiment doesn’t mean the business fundamentals have changed and I think this is a great opportunity to buy a company with a lot of potential at a discount. While there is a lot of competition, there is also a huge opportunity in the Chinese video streaming market, and if iQiyi can continue to be the leader, I really like their chance to outperform the market over the next 5 years.

MercadoLibre (MELI)

I can’t believe I haven’t written anything about MercadoLibre yet considering it is one of my favorite companies right now. For those unfamiliar with the company, the easiest description of what the Brazil-based (but founded in Argentina) company does is “Amazon for Latin America” (although Ebay might be a more accurate comparison). They are an up and coming eCommerce company that does a lot of business in Brazil, Argentina, and Mexico. While India and China seem to get all the publicity in our Northern Hemisphere-centric world, there’s an interesting emerging market opportunity in South America as well that MercadoLibre is well positioned to benefit from.

South America has seen a lot of volatility in recent years. Argentina has been grappling with debt and economic problems. Brazil has been hit by corruption scandals. Worst and most tragic of all, Venezuela’s economy has been basically disintegrating. It’s nothing short of miraculous, then, that MercadoLibre has been able to do as well as it has during this time (doubling in the past 2 years) considering how much business that it does in those markets. If there’s just a slight turnaround in some of those countries in 2019, it could be a major catalyst for MercadoLibre to really soar. Even if there isn’t a turnaround, though, management has proven that they are able to grow even in challenging environments, and I have faith that they will continue to do so.

It’s not just the eCommerce potential that has me excited, though. MercadoLibre also has a payments platform somewhat similar to Paypal called MercadoPago which has a lot of potential for growth as well. While this is getting incredibly ahead of things, it’s interesting to note that Paypal alone currently has a market cap roughly 7 times the size of MercadoLibre. So if MercadoPago can see even a fraction of the success that Paypal has, there is a lot of upside there.

Which leads to an unexpectedly good transition to…

Square (SQ)

There’s a good chance you’ve seen a Square device, even if you have no idea what the company does. Have you ever been to a farmer’s market or a small, independent coffee shop where they scanned your credit card using a small device plugged into the headphone jack of a phone or tablet? That could’ve been a Square reader. The technology has advanced since then, and so have the services offered by Square.

Square essentially creates tools and services to help small and mid-sized businesses accept payments. It started off with those cheap and easy to use readers, but has grown into a myriad of different services now. They’ve begun making loans and cash advances to clients who use their point-of-sale (POS… yes, that’s the real acronym… stop laughing) system as part of their Square Capital service. They’ve filed for a banking license to increase the number of financing services that they can offer. They’ve even begun encroaching on PayPal’s (PYPL) space by offering their own peer-to-peer payment service called Square Cash.

That’s a lot of irons in the fire, and as the country moves more and more away from cash, I think Square is well-positioned to benefit. The stock got whacked pretty hard in the last quarter of 2018 and lost around 40% of its value. Part of that seemed to be due to the general market downturn, but part of it also was because Square lost CFO Sarah Friar as she left to become CEO at Nextdoor. Friar was very well regarded, and so it was a big loss for the company, but a 40% drop seems overstated. It’s worth noting that even with the big drop, Square was still up around 50% for 2018.

I don’t see any reason why Square can’t regain their 2018 highs in 2019, which would be a near double from where it is now. I’m very interested in seeing what Square can do in the coming year.

Teladoc (TDOC)

Count this as a bet on the trend of the health care industry moving more and more to telemedicine with Teladoc being the leader in the space. It’s no secret that health care costs have been spiraling out of control and everybody is looking for ways to cut costs and increase efficiencies. I think telemedicine is a powerful tool in that fight. Not every health concern requires a visit to the doctor’s office and being able to consult with a doctor from the comfort of your home can not only be more convenient, but cheaper too. I think Teladoc has what it takes to capitalize on that trend.

If you’re interested in reading more about Teladoc and the opportunity in front of them, here is a good Seeking Alpha article about them.

What are your top stocks for 2019?

So those are the five companies in my portfolio for the Fantasy Investing 2019 season that also turn out to be my top 5 stocks for 2019. What are your best ideas for 2019? Let me know in the comments. Looking forward to checking in on the early results of the Fantasy Investing 2019 season in a few weeks. And don’t forget:

They may take our alpha, but they’ll never take our Tamis!

Okay… I definitely need a better name.