My holding period just increased
Real Estate Summary for Week ending 6/17/22
Summary of my Real Estate activities for the past week.
M1 Finance - 7 buys this week.
Posted an overall loss again this week on this REIT portfolio as 'Fat Cat Investing' is currently DOWN 5.08% for the week, but overall is UP marginally 0.80% since inception.
Concreit - received my weekly dividend payment of $0.1402 on deposits of $111.46 (including new deposits and DRIP).
Both are a part of my ongoing "Real Estate Rumble"
Why I like dividend growth investing and you might too...
I have been a dividend investor for more than 20 months now and I was able to build a portfolio of over $350,000. Now the portfolio is hovering around $300,000. YTD my portfolio is down around 13% and wrecks my heart as my portfolio is going down everyday. There are times people in finance attack dividend growth investing at times for its focus on companies that payout dividends, and as it is passive form of investing - today I will try to defend DGI by showing how it's relatively good in all market conditions with a brief history and strategy of my portfolio. I look towards the positive side and why I choose Dividend Growth Investing in the first place.
💸 Dividend growth investing in every market conditions
The market can go in 3 directions and here are the scenarios and why dividend growth investing makes the best out of every conditions assuming companies that you invested doesn't cut the dividends:
- 👉🏽 Sideways: If the price stays relatively flat, we can buy more of the shares at $100, and once the sideways movement ends the compounding will be greater as we accumulated more stocks at a small price.
- 👇🏽 Downwards: Let's say if the market goes down, we still are getting the dividends from stocks that we hold. So, we can accumulate more of the dividend stock at a lesser price. We are increasing the cash flow and buying more assets.We just have to play the waiting game for the market to go to the bull run for capital gains.
- 👆🏽 Upwards: Although, our reinvested money won't be able to buy as much of the asset, we have both capital gain and dividends to re-invest.
📝 Brief history of my portfolio
I have been building my portfolio for few 20 months now and I have recently crossed $16k in dividends 🥳🎉. Capital gains can vanish like how it did with my $U but companies won't ask the dividends back
My portfolio link: here.
🙈 My strategy
I have concentrated down my portfolio into 3 parts in the hopes to achieve all the possible benefits of dividends and growth of dividend growth investing.
- 💰 Income: I want my portfolio to earn as much as I can, so I can re-invest as much as I can. This is possible due to covered call ETFs with high dividend yields like $JEPI, $QYLD and $BST. These 3 income ETFs yield at an average of 10.15% and has an expense ratio of 0.6% (on the higher side). They generate over 60% of my dividend income while they are 35% of my portfolio. I don't expect significant capital gain from it.
- 💸 Cashflow: While income and cashflow are similar, cashflow category consists of monthly dividend stocks that yields at lower rates and has capital appreciation. This includes stocks like $O, $STAG, $AGNC, $NRZ. They cover around 15% of the portfolio while generating around 20% of the dividends income.
- 💗 Growth: For growth in both capital gains and dividend CAGR I have stocks like $AAPL, $MSFT, $VICI, $VOO (i am planning to increase my position), $HD, $COST, $WM and $JPM. Together they make 45% of the portfolio and generating 20% of the dividends. They have a 3 year - weighted CAGR of 8.28% and average 3 year CAGR of 9.68%.
This gives my portfolio a decent place to stand. It will generate around $1,584.67 (while my cost per month are barely over $300) per month at 5%+ dividend yield (good cashflow). It also has a beta of 1.000217417 where I will be making gains similar to market (which I am happy about) and the movement lets me sleep well in the night as well (not too crazy in comparison to other individual stocks), so I can expect to make around 8ish% per year in capital gains. And, best of all the dividend CAGR is at 12%. So, I will be increasing my dividend cashflow too. This might be too conservative for some and but this gives me everything I need - cashflow and peace of mind.
Investing is like having sex - very personal. Everyone follows different strategy, and has different goals. But, every now and then it's exciting to mix things up. So, you might want to give DGI a try, you might like it...
And my final attempt to convince you to try DGI...
If this magic trick doesn't convince you, idk what will haha
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Keep accumulating and building that passive income! Doing that now when things are down is much better for you long term if you stick to it! Congrats on the substantial portfolio.
Real Estate Summary for Week ending 5/27/22
Summary of my Real Estate activities for the week.
M1 Finance - 17 buys this week
$ADC, $BMRK, $BXP, $EQIX, $HASI, $HIW, $IIPR, $IRM, $KRC, $O, $PLD, $RPT, $SPG, $STAG, $URD, $VICI, $WPC
Posted gains this week on this REIT portfolio as 'Fat Cat Investing' is currently UP 5.30% for the week and UP 5.51% overall since inception.
Concreit - received my weekly dividend payment of $0.126875 on deposits of $101.06 (including DRIP).
Both are a part of my ongoing "Real Estate Rumble"
The industrial real estate industry is looking to enter a downcycle
According to Wired, $AMZN is looking to cut back on warehouse space as its projections of high online retail sales didn't materialize.
Many of the leases that Amazon made during the pandemic with warehouse providers are now looking to be cut. The recent retail sales report shows that consumers are paying more for items; not buying more items. Even if consumers might still be sitting on a higher pile of savings, inflation is eroding the real value of people's savings.
E-commerce fueled the surge in demand for warehouse space. As the industry endures a slowdown, demand for warehouse space will decline. Many of the pre-leases that e-commerce companies have signed with developers are looking to get cut in the process. Developers will continue to finish the construction of warehouses, only to find that their project will finish at a time when there's a huge glut in the supply of warehouses.
$PLD $STAG and other warehouse stocks will see their pricing power erode. As for the cold storage warehouse providers like $COLD, I do see them handling the supply glut better because demand for cold storage is still high.
Using Dow Theory, the declining demand for warehouse space correspond to a freight recession. Companies are cutting back on transportation services because they are ordering less inventory. $FDX $UPS $JBHT $XPO are other trucking and parcel delivery companies are going to be impacted negatively by the decline in e-commerce. UPS fell after their earnings because of that reason.
For now, I plan on holding $STAG because I enjoy the monthly dividends I receive from it. I'll be monitoring their earnings and reading the earnings transcripts to see how conditions in the warehouse REIT space are holding up.
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Like everything tied to retail and consumer demand, bad short term outlook for sure. I’m holding a small amount of $STAG and $PLD. Wouldn’t be surprised to see them drift lower but I like them long term so I don’t see the point in selling to buy back a little lower. I think demand will come back before it gets really painful. I do see some positives here too. Amazon will stop building their own warehouses now and maybe even sell some as leasing will provide more flexibility in dealing with inventory cycles. The second positive is that as other e-comm businesses scale they will fill in the spaces left by Amazon. Obviously this is dependent on demand coming back but if you think e-comm is still a growing market, warehouses will be integral to that long term, and this is just a temporary bump in the road. Now though the retail and e-comm companies will be more hesitant to try to build their own warehouses as it’s added risk to manage during down cycles. The warehouse as a real estate sector is now a fortified sector for real estate companies.
Happy "National Apple Pie Day"! – May 13, 2022
My investing strategy
My long term investing strategy consists of mostly ETFs. I like to use M1 Finance because I can group multiple ETFs and stocks together into pies essentially creating my own ETF. ETFs are great because they can provide safety and consistency.
Here’s the break down of my pies on M1 Finance:
30% Income ETF: this pie includes ETFs that pay a high dividend yield and 2 that are tax advantaged. This includes $EVT $QYLD $RYLD $XYLD $HDV $DVY $HTD $JEPI $NUSI $UTG
25% Growth ETF: this includes ETFs with growth potential and different objectives and holdings. This includes $ENFR $DGRO $SCHD $VGT $EELV $VNQ
25% MLP: this includes master limited partnerships. These are a different type of investment that can offer high returns and tax advantages. This includes $AB $CEQP $EVA $MPLX $MMP $USAC
20% Dividend growth ETF: this is my own ETF I made of stocks with growth and consistent dividends. This includes $AAPL $ABBV $ABR $APTS $AVGO $BLK $BAC $BCE $BMO $BP $BXMT $CAT $CSCO $CVX $ENB $EQR $ESS $HRZN $HTA $IIPR $JPM $KB $KIM $KO $LYB $MMM $MO $MPW $MSB $MSFT $NEWT $NKE $O $OHI $OKE $PRU $RY $SBLK $SKT $STAG $STWD $TD $TGT $VZ $WPC $XOM
I use my Fidelity account to pick individual growth stocks and my TD Ameritrade account to swing trade.
Strategy: growth and income, mix of high and moderate risk
Dividend yield: 5.95%
Last year return: 12.29%
M1 Finance total holdings: 68 (16 ETFs)
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Thanks for sharing about your ETF strategy—
I think I remember hearing a bit about your Master Limited Partnership investing a while ago. I forget, what we’re the tax benefits associated with those?
Let's talk about the losers!!! 😭
We often talk about only winners, and to the audience, it probably seems like every stock is gonna go up. And, when we disclose about our losing stock - we end up giving reasons behind the fall and make it up saying oh I'll add because of conviction. But, we proudly show the winning stocks and rarely show the losing stock. I have been guilty of it.
What I can bet is no investor in the world has ever been green on all of their stocks. I am pretty sure they have closed at least one security on red.
I love being transparent, showing ups and downs, showing not all plays will be profitable and the goal is to offset losers with bigger winners.
List of my losing stocks:
I am significantly down on $LTC, $BTI, and $UL with 13%, 7%, and 7% down respectively. I am also down in the range of 4%-2% on stocks like $AGNC, $MMM, $ABBV, and $BEN. My recent purchases in the income fund ($NUSI, $QYLD, and $JEPI) have incurred an unrealized loss of over 1%. My total loss is $6,450.
I however am lucky to have gained significantly in other stocks like $U (+54%), $COST (+23.73%), $MSFT (+23.27%), $JPM, $STAG, $WM, $AAPL, $NRZ (+20% to +15%).
The game plan:
The game plan is to not incur a loss in the portfolio even if there are few red stocks. So, that's what I am doing right now. That's what I am doing as the well total gain is around $35,796.04, the net profit being $ 29,345.67. The gain from the top three gainers ($+7,392.80) offsets all of the losses of $6,450.
Dream Fund : start of financial freedom for friends and families
How it started?
It all started with one of my followers (in instagram) asking me if I could invest on his behalf as he saw my gradual progress in capital gain and decent cashflow that I was generating from my portfolio. Soon, 3 more people asked if it as possible for me to invest theirs too.
Screenshot says - if it's possible for me to invest their money in Nepali
For few months, I was unable to decide if I could invest their money. I understood my money, understood my risk apatite, understood my macros. One lingering question was what if I loose their money?
Reminder to self:
I had to remind myself that it is what I always wanted to be - help others to be financially free. Besides, I have been helping my best friend to invest regularly. So, I had a chat with him and we decided to take the job.
I wanted my friends to be in safe spot in unlikely time if there is a huge loss in investing. So here are few things that I made my friends and family do in order for me to start investing on their behalf.
- Have 6 months of cashflow with yourself all the time
- Invest just 20-30% of saving with me
- Have a stable 9-5 job or business with cashflow
These things are easier said than done. But, they agreed. I registered a company and we started.
Status right now:
We just made our first purchases of $500 on Oct 8th. We still are struggling to make the recurring invoicing Venmo and Cashapp (let me know if you have an idea). Most of the investors of the funds are under 30, and are investing in the range of $50 to $500. Collectively we raise around $1,050 and soon will increase to $1,500+ in a month. Individuals can track their portion of investment with a google sheet that I have developed and given access to.
I myself am investing $100 per month that I can use for my kids (I don't have kids right now). It serves two purposes.
- My money is involved in the fund - so I will be committed to the fund
- My kids won't have to worry about money when they grow up and they can instead focus on this they love
Why the name "Dream Fund"?
Fun consists of 3 friends (met all of them from my instagram page) and 1 family member and myself. In a way this fund will enable everyone to achieve their dream of financial freedom.
We are targeting to move along with $SPY meaning around 10% yearly growth. The portfolio is blend of value, growth and dividend stocks as it consists: $COST, $BABA, $DIS, $WM, $MMM, $U, $JNJ, $SQ, $O, $AAPL, $JPM, $VHT, $IS, $STAG, $IS. The dividend yield is decent with 1.3% - which will be reinvested for upto 20 years. Its dividend growth CAGR for last 3 years is 7.5%.
The goal is to grow this portfolio to $1,000,000 (hopefully I will over achieve it) in 20 years with regular yearly contribution of $18,000. If the portfolio is over a $1M, everyone in the bucket will have over $100,000 and it will be the life changing amount generated out of cutting additional expenses in their lives.
The below screenshot shows it to be true, but not everything goes according to plan.
My guess is the portfolio's capital gain will be higher than $SPY and am expecting the total return to be higher.
Like Dory says "Just keep swimming". We will be holding some cash, and invest others when we think the time is appropriate.
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I think you are an example of what is to come in the personal finance and investing world. Instead of paying wealth mangers 1% of our networth, the smartest, most trustworthy person in your social circle has the opportunity to be a micro-fund manager.
These fund managers will be able to give better personalized interactions than current financial advisors (at the onset), and their returns will be tracked over time and compared against alternatives. The best micro fund managers will rise to the top and attract more capital. If current wealth managers want to survive in the new paradigm, they need to start tracking their returns out in the open- aka, be on Commonstock.
And for the average person who wants a new opportunity, there’s a special window right now to start tracking your investments in public, because you have a chance to start your public track record at the same time as all the incumbents.
Returns on Commonstock only go back one year right now. But in the future it will be much longer (I hope— it will have to be otherwise it won’t be a useful tool). So if you are just getting started right now you have an advantage: everyone who has been investing longer than a year doesn’t get to display their track record. Experienced investors don’t get any extra credibility past one year. Not sure if that is by design, but it’s smart because new fund managers (who are more likely to try a new platform to establish credibility) also have a more even playing field.
Good luck @investor_from_nepal ! I hope lots of Nepali friends and family invest with you!
Facts about my portfolio : 80-20 rule?
Today I hit a milestone of reaching NRs. 40 million, or NRs. 4 crore. So, I decided to look at all of my portfolios and analyze them.
As I initially started focusing on cashflow / dividend - it only makes sense that most of my holdings are dividend investments. 96% of my total investments are in stocks that give dividends. With my monthly dividend being around $1,177 on average (which is more than enough for me to run my family) with 5%+ dividend CAGR. 17% of total return came in the form of dividends. 51% of total return came from dividend stocks.
I was a part of crypto craze. I traded $BTC and made profit out of it. I held significant amount of $BTC and $ETH and closed the position. Now, I hold small positions on $ETH and $ADA. I have invested total of 0.37% of my investments in crypto and it has returned 18% of total return. Crazy right! If you can follow the trend or be early adopter, you can have a chance to make huge profit.
Now let's talk about my growth stocks. I have 2 dedicated portfolio around 4% of my total investment. My growth portfolio consists of my multi-bagger ROTH IRA which I talk about in this article https://commonstock.com/memo/f8bf6683-0b 50-434e-842d-a319d54ab733
and my story fund where I choose my companies based on their story or their founders' story which I talk about in https://commonstock.com/post/f7e91973-e375-4da9-a72c-1e5ad2a1b898. It also consists $U that I have in my dividend growth portfolio. It has returned total of around 35% return. 4% investment returning 35%+ return is crazy!
$U is my favourite stock by far. 2.2% of my total investments are in $U. It has returned over 10% of total return. Apart from $U, I love $U, $IS and $APP as I have worked with em for over 10 years. They add up to 3.43% of total investment and have returned around 12% return.
The 80-20 rule, also known as the Pareto Principle, is an aphorism which asserts that 80% of outcomes (or outputs) result from 20% of all causes (or inputs) for any given event. In business, a goal of the 80-20 rule is to identify inputs that are potentially the most productive and make them the priority. If it were to apply, I would have made my 80% return with 20% of my investments. Let's check it out.
$U, $JPM, $AAPL, $MSFT and $STAG, $WM, $ADA and $ETH makeup around 20% of total investment and have generated around 60% of total return.
Even though it didn't quite follow 80-20 rule. It was close enough.
Commonstock is a social network that amplifies the knowledge of the best investors, verified by actual track records for signal over noise. Community members can link their existing brokerage accounts and share their real time portfolio, performance and trades (by percent only, dollar amounts never shared). Commonstock is not a brokerage, but a social layer on top of existing brokerages helping to create more engaged and informed investors.