Since we’re already two weeks into July, the time has come to once again take a quick look at my portfolio. Portfolio performance is a fickle and whimsical beast, but even as a dividend growth investor I keep tabs on my net worth. After all, what’s not to like about seeing the numbers tick up month after month?
It’s true that my portfolio experienced rapid growth during the past year, mainly as a result of a depreciating Euro and my low spending. Even though my savings effectiveness remained more or less the same, the speed at which my net worth increases, has slowed down significantly following the beating many European stocks took as a result of the Greek crisis.
Nevertheless, I’m happy to report another jump forward from last month’s net worth update. Even though the €1,184 gain this month comes in under what I managed to save in June, July remains a step in the right direction.
The more astute among you quickly figured out that, as an inevitable consequence, the power of compounding interest worked against me this month. However, I still feel incredibly fortunate about the road I’m currently travelling. Financial independence and dividend growth investing are more akin to a marathon rather than a quick sprint, after all.
July’s net worth growth lands on a humble 1.80%, which I feel is pretty good considering the current size of my portfolio and the state of the stock market. In any case, I managed to save up another 100 hours of work-free capital that my future self can take advantage of.
Still not impressed? At my current savings rate, this much additional capital allows me to retire over half a month earlier. Amazing!
Below you can find my portfolio as usual. It’s made up of individual dividend growth stocks, of exchange-traded index funds, and of safer investment vehicles and a small pension fund. Foreign stocks were converted into Euros using the last-known exchange rate.
Dividend growth stocks
Down. Up. Down. Up. Down again. The European finance ministers turned the stock market into a true rollercoaster ride. One day European stocks would gain over 2%, while the next they could tumble 3% or more. When, finally, a solution was agreed upon, many stocks settled on their pre-crisis price points.
As a result, there’s a lot of green, but also a lot of red in the list below. German insurance company Münchener Rückversicherungs-Gesellschaft (ETR:MUV2), for example, trades well below my purchase price, while the Belgian Kinepolis (EBR:KIN) gained over one tenth of its value.
All things considered, performance remains top-notch. I couldn’t be more happy with the portfolio I’ve put together over the past ten months. And the best thing about owning a small piece of these companies? They’ll continue to build my passive income even if their market value goes down.
The cost basis for each position includes the price of the shares, a 0.27% stock market tax and brokerage fees.
|Ticker||Company||Shares||Cost basis||Mkt. value||Gain|
|BLT||BHP Billiton plc||48||928.94||855.20||-7.94%|
|DE||Deere & Company||7||452.61||612.42||+35.31%|
|HOME||Home Invest Belgium||15||1,396.25||1,329.00||-4.82%|
|JNJ||Johnson & Johnson||6||473.79||543.23||+14.66%|
|NG||National Grid plc||100||1,332.11||1,219.42||-8.46%|
|PG||Procter & Gamble||9||575.36||670.11||+16.47%|
|RB||Reckitt Benckiser plc||10||630.34||835.98||+32.62%|
|ROG||Roche Holding AG||5||1,233.71||1,336.59||+8.34%|
|RDSB||Royal Dutch Shell||60||1,745.65||1,582.20||-9.36%|
|S32||South 32 Ltd.||48||20.04||57.20||+185.45%|
|KO||The Coca Cola Company||17||540.05||635.66||+17.70%|
|VZ||Verizon Communications Inc.||20||785.07||860.19||+9.57%|
When I first started out seeking financial independence I decided to purchase exchange-traded funds. Being a novice investor I felt a lot for the “index” approach to investing because it required a set-it and forget-it mentality. To this day I feel index funds are an excellent way to reach financial independence.
That’s why I hold on to the three ETFs below. What’s more, I’ve decided to add to the MSCI World index fund through small purchases as to balance and further diversify my portfolio.
|Ticker||ETF||Cost basis||Mkt. value||Gain|
|IWDA||iShares Core MSCI World||5,214.95||6,614.16||+26.83%|
|IEMA||iShares MSCI Emerging Markets||1,214.59||1,380.24||+13.64%|
|IMAE||iShares MSCI Europe||3,561.94||4,220.48||+18.49%|
Next to the stock market’s upward and downard bursts, this category remains relatively stable. As usual I added another €77.5 towards the yearly maximum of €930 in my personal pension fund, while my emergency fund and savings accounts remained untouched.
|Name||Cost basis||Current value||Gain|
|Pension fund||1,415.00||1,534.72||+8.46% and 30% tax break|
In previous net worth updates I’ve called living frugally, saving as much as possible, and investing those savings the holy trifecta of financial independence. Today I feel as strongly as ever about that statement. Even with the stock market in disarray, I’ve managed to make significant gains towards financial freedom. Another great month of dividend income is exemplary of that.
Indeed, progress has been so stellar that I’m almost at my year-end goal of €70,000 in money-building assets, as surprising as that may sound for someone who only really started putting in the works one year ago. As a result, I’m confident that the road I’m currently on is the right one – I hope you feel the same way!
Thank you for reading.