Make a spot in the middle of your mind where you can lie hidden, rejoice, and relax with no one interrupting you.
Petrarch
This is my sixty-sixth monthly portfolio update. I complete this regular update to check progress against my goal.
Portfolio goal
My objective is to maintain a portfolio of at least $2,620,000 through 2022. This should be capable of producing an annual income from total portfolio returns of about $91,600 (in 2022 dollars).
This portfolio objective is based on an assumed safe withdrawal rate of 3.5 per cent.
A secondary focus through 2022 will be achieving the minimum equity target of $2,100,000.
Portfolio summary
| Vanguard Lifestrategy High Growth Fund | $763,710 |
| Vanguard Lifestrategy Growth Fund | $40,760 |
| Vanguard Lifestrategy Balanced Fund | $73,303 |
| Vanguard Diversified Bonds Fund | $90,568 |
| Vanguard Australian Shares ETF (VAS) | $378,234 |
| Vanguard International Shares ETF (VGS) | $320,331 |
| Betashares Australia 200 ETF (A200) | $287,538 |
| Telstra shares (TLS) | $2,068 |
| Insurance Australia Group shares (IAG) | $5,536 |
| NIB Holdings shares (NHF) | $8,868 |
| Gold ETF (GOLD.ASX) | $116,688 |
| Secured physical gold | $18,607 |
| Plenti (P2P lending) | $23 |
| Bitcoin | $487,750 |
| Raiz app (Aggressive portfolio) | $20,142 |
| Spaceship Voyager app (Index portfolio) | $3,196 |
| BrickX (P2P rental real estate) | $4,715 |
| Total portfolio value | $2,622,037 (-$158,939) |
Asset allocation
| Australian shares | 38.2% |
| Global shares | 25.9% |
| Emerging market shares | 1.6% |
| International small companies | 2.0% |
| Total international shares | 29.5% |
| Total shares | 67.7% (-12.3%) |
| Total property securities | 0.2% (+0.2%) |
| Australian bonds | 2.5% |
| International bonds | 5.8% |
| Total bonds | 8.3% (+3.3%) |
| Gold | 5.2% |
| Bitcoin | 18.6% |
| Gold and alternatives | 23.8% (+8.8%) |
Presented visually, the chart below is a high-level view of the current asset allocation of the portfolio.
Comments
This month is a story in two parts – with declines across both the traditional financial portfolio, and in the value of Bitcoin holdings.
Combined, these led to an overall loss of about $159,000 or around 5.7 per cent of the total portfolio value.
The portfolio has narrowly stayed above the revised portfolio goal of $2.62 million at the end of the month, but through the month dipped below it for the first time in nearly a year.
More than three-quarters of the absolute decline in portfolio value was caused by a fall of around 20 per cent in the price of Bitcoin over the month.
These falls occurred as inflation outcomes continued to illustrate the potential need for monetary policy tightening to the market, and the price of Bitcoin was also likely impacted by the failure of the Terra Luna algorithmic stablecoin.
The remainder of the portfolio loss was largely attributable to simultaneous declines in Australian and global share indexes. These each fell between 2 to 2.5 per cent.
Completing the overall negative pattern were falls in gold (of 3.3 per cent) and continued further declines in the value of bonds or fixed interest (0.2 per cent).
Continue reading “Monthly Portfolio Update – May 2022”