Nothing is so simple that at first sight it is not rather difficult to believe.

Lucretius

This is my fifty-seventh monthly portfolio update. I complete this regular update to check progress against my goal.

Portfolio goal

My objective is to reach a portfolio of $2,585,000 by 31 July 2022. This would produce a real annual income of about $90,500 (in 2021 dollars).

This portfolio objective is based on an assumed safe withdrawal rate of 3.5 per cent.

Portfolio summary

Vanguard Lifestrategy High Growth Fund	$827,990
Vanguard Lifestrategy Growth Fund	$44,452
Vanguard Lifestrategy Balanced Fund	$80,423
Vanguard Diversified Bonds Fund	$101,260
Vanguard Australian Shares ETF (VAS)	$360,383
Vanguard International Shares ETF (VGS)	$227,040
Betashares Australia 200 ETF (A200)	$297,832
Telstra shares (TLS)	$2,046
Insurance Australia Group shares (IAG)	$6,639
NIB Holdings shares (NHF)	$8,124
Gold ETF (GOLD.ASX)	$112,377
Secured physical gold	$17,967
Plenti (P2P lending)	$1,479
Bitcoin	$727,780
Raiz app (Aggressive portfolio)	$21,380
Spaceship Voyager app (Index portfolio)	$3,502
BrickX (P2P rental real estate)	$4,982
Total portfolio value	$2,845,658 (+$162,232)

Asset allocation

Australian shares	35.9%
Global shares	21.7%
Emerging market shares	1.6%
International small companies	2.0%
Total international shares	25.3%
Total shares	61.2% (-13.8%)
Total property securities	0.2% (+0.2%)
Australian bonds	2.6%
International bonds	5.8%
Total bonds	8.5% (-6.5%)
Gold	4.6%
Bitcoin	25.6%
Gold and alternatives	30.2% (+20.2%)

Presented visually, the chart below is a high-level view of the current asset allocation of the portfolio.

Comments

This month the financial independence portfolio has surged to its highest level on the journey, growing 5.7 per cent or $162,000.

This results in the portfolio reaching $2.84 million, overtaking short-lived peaks in March and April.

This is nearly double the growth of the last month, and clearly came from two main sources.

First, the value of Bitcoin holdings increased by around 14 per cent, or nearly $100,000. The second area of expansion was equities, where international shares grew by 3.6 per cent. Similarly, Australian equities increased in value by around 2.5 per cent, or around $23,000.

In contrast to this, both gold and bond holdings were largely stable.

Strong equity markets have also taken the equity component of the portfolio to its highest ever level, meaning that total equity holdings are at 90 per cent of the intended target allocation (estimated as $1.9 million, or around 75 per cent of the total portfolio goal).

Applying my longer-term asset allocation glide-path towards an equal balance between global and Australian shares, this month new investments have been exclusively directed to the Vanguard global shares (VGS) fund.

Continue reading “Monthly Portfolio Update – August 2021”

Till noon we quietly sailed on,

Yet never a breeze did breathe:

Slowly and smoothly went the ship,

Moved onward from beneath.

Samuel Taylor Coleridge, The Rime of the Ancient Mariner, Part V

This is my fifty-sixth monthly portfolio update. I complete this regular update to check progress against my goal.

Portfolio goal

My objective is to reach a portfolio of $2,585,000 by 31 July 2022. This would produce a real annual income of about $90,500 (in 2021 dollars).

This portfolio objective is based on an assumed safe withdrawal rate of 3.5 per cent.

Portfolio summary

Vanguard Lifestrategy High Growth Fund	$810,231
Vanguard Lifestrategy Growth Fund	$43,713
Vanguard Lifestrategy Balanced Fund	$79,464
Vanguard Diversified Bonds Fund	$101,270
Vanguard Australian Shares ETF (VAS)	$351,101
Vanguard International Shares ETF (VGS)	$200,090
Betashares Australia 200 ETF (A200)	$290,938
Telstra shares (TLS)	$2,014
Insurance Australia Group shares (IAG)	$6,144
NIB Holdings shares (NHF)	$8,568
Gold ETF (GOLD.ASX)	$112,261
Secured physical gold	$17,980
Plenti (P2P lending)	$1,918
Bitcoin	$628,750
Raiz app (Aggressive portfolio)	$21,014
Spaceship Voyager app (Index portfolio)	$3,412
BrickX (P2P rental real estate)	$4,558
Total portfolio value	$2,683,426 (+$87,183)

Asset allocation

Australian shares	37.2%
Global shares	21.7%
Emerging market shares	1.7%
International small companies	2.1%
Total international shares	25.4%
Total shares	62.6% (-12.4%)
Total property securities	0.2% (+0.2%)
Australian bonds	2.8%
International bonds	6.1%
Total bonds	8.9% (-6.1%)
Gold	4.9%
Bitcoin	23.4%
Gold and alternatives	28.3% (+18.3%)

Presented visually, the chart below is a high-level view of the current asset allocation of the portfolio.

Comments

The financial independence portfolio has grown by just over $87,000 since the last monthly update, or around 3.2 per cent.

This means that it continues to sit notionally above the portfolio goal, and expand, tracking towards its previous highs.

Yet this month has some peculiarities that affect the interpretation of these results.

The portfolio distributions received from the second quarter have led to a notional decrease in the level of equity holdings, because these have not immediately been reinvested.

In reality, around $52,000 of these distributions are aside in cash. They have yet to be put back into the portfolio, and are not recorded in the portfolio report.

Rather, these will continue to be placed into equity exchange traded funds (ETFs) on a fortnightly basis through to December, balanced between Vanguard’s Australian shares (VAS) and international shares funds (VGS).

This process will represent a significant underlying current pulling the portfolio in a positive direction over the next five months. For the current month, however, it means that the headline monthly portfolio movement is somewhat artificially lowered, and the absolute value of the equity portfolio is actually temporarily lower than a month ago.

With these caveats, there was price growth of 2.5 per cent in the international shares holdings, and Australian equities also increased in price by just less than 1.0 per cent. As a result, total equities holdings now sit at around 87 per cent of the intended target allocation (of $1.9 million, or around 75 per cent of the total portfolio goal).

Gold increased in value by around 5.3 per cent as global interest rates recommenced a downward movement, and bonds also increased in total value, despite their second quarter distributions.

The single largest positive contributor to the portfolio movement was once again Bitcoin, where holdings grew in value by over 17 per cent or $90,000.

Continue reading “Monthly Portfolio Update – July 2021”

Day by day, what you choose, what you think and what you do is who you become.

Heraclitus

This is my fifty-fifth monthly portfolio update. I complete this regular update to check progress against my goal.

Portfolio goal

My objective is to reach a portfolio of $2,585,000 by 31 July 2022. This would produce a real annual income of about $90,500 (in 2021 dollars).

This portfolio objective is based on an assumed safe withdrawal rate of 3.5 per cent.

Portfolio summary

Vanguard Lifestrategy High Growth Fund	$861,242
Vanguard Lifestrategy Growth Fund	$46,541
Vanguard Lifestrategy Balanced Fund	$83,858
Vanguard Diversified Bonds Fund	$100,821
Vanguard Australian Shares ETF (VAS)	$339,296
Vanguard International Shares ETF (VGS)	$185,504
Betashares Australia 200 ETF (A200)	$288,586
Telstra shares (TLS)	$2,004
Insurance Australia Group shares (IAG)	$6,537
NIB Holdings shares (NHF)	$7,812
Gold ETF (GOLD.ASX)	$106,302
Secured physical gold	$16,991
Plenti (P2P lending)	$3,076
Bitcoin	$518,680
Raiz app (Aggressive portfolio)	$21,032
Spaceship Voyager app (Index portfolio)	$3,409
BrickX (P2P rental real estate)	$4,552
Total portfolio value	$2,596,243 (+$63,666)

Asset allocation

Australian shares	38.7%
Global shares	22.7%
Emerging market shares	1.8%
International small companies	2.3%
Total international shares	26.8%
Total shares	65.5% (-9.5%)
Total property securities	0.2% (+0.2%)
Australian bonds	3.0%
International bonds	6.5%
Total bonds	9.5% (-5.5%)
Gold	4.7%
Bitcoin	20.0%
Gold and alternatives	24.7% (+14.7%)

Presented visually, the chart below is a high-level view of the current asset allocation of the portfolio.

Comments

The portfolio has gained around $63,000 over this past month. This has meant a partial recovery from the steep falls experienced last month.

All elements of the portfolio contributed to this return to growth, except for a small fall in the value of gold holdings.

Over the month the portfolio has increased by a total of 2.5 per cent. This growth means that the portfolio is once again operating just above the final portfolio goal, following it first reaching that level in late December 2020, and spending some time above it through the early part of this year.

Once again the equity component of the portfolio grew this month, increasing by around $60,000. This pushed forward the equity portfolio to two significant milestones.

First, the Australian equity portfolio has broken the $1,000,000 mark. By way of comparison, Australian equities represented $280,000 at the beginning of this record in early 2017.

Second, the total equity portfolio – including global equities – has now reached $1.7 million, or 88 per cent of the intended target allocation (of $1.9 million, or around 75 per cent of the total portfolio goal).

The value of Australian equities grew by around 2.0 per cent, and the value of international shares increased by around 4.3 per cent over the month.

Continue reading “Monthly Portfolio Update – June 2021”