April 2024 was lastly the break within the bull pattern that had began method again in November 2023. Whereas markets solely actually pulled again about 5% month on month which barely even qualifies as a pullback, a minimum of now it’s lastly clear that the bull market isn’t invincible. Sticky inflation and a FED that doesn’t wish to transfer on charges drove the market downturn this month.
In the event you haven’t already learn my posts earlier than, I achieved Monetary independence again in late 2020 early 2021 with a portfolio of roughly $1.3m invested in primarily ETFs. This ballooned to $1.7m through the peak of the markets in early 2022 earlier than coming again right down to Earth later in 2022.
This put up will likely be a part of a month-to-month sequence of portfolio updates that summarizes how my portfolio carried out, what trades I executed, what my month-to-month bills had been, and my common outlook on the economic system/markets. That is by no means monetary recommendation so don’t look take a look at me for sage recommendation. I make silly trades and make even worse losses fairly regularly.
That is merely the efficiency of my portfolio and the way it has carried out on a month to month foundation.
Month-to-month Highlights – April 2024
- Internet price is close to $1.76m as of April 2023 Month finish
- -$90k for the month
- Went to Seoul and Tokyo for the month, and again in Lombok, Indonesia for some good instances.
Market Strikes
3/31/2024 | 4/30/2024 | % Change | |
Dow Jones | 39,567 | 37,816 | 4.43% |
S&P 500 | 5,244 | 5,036 | 3.97% |
Nasdaq | 16,397 | 15,658 | 4.51% |
What’s in my portfolio?
My portfolio is sort of easy and straight ahead. I’ve my holdings primarily unfold out between a number of ETFs, mounted earnings, and numerous single identify shares.
Mounted Revenue
Attributable to rising charges, I’ve additionally allotted a small a part of my portfolio (<5%) to mounted earnings merchandise. I’ve been buying 5.5% yielding treasury payments with a 3-6 month expiry. I at the moment have about ~$60k invested in a 3-mo T-Invoice that may expire in June 2024.
I’ll most likely roll this contract and purchase one other 3mo t-bill when it expires in June 2024 because the 5.5% yield is tough to cross up.
That is assured cash with zero danger which I made a decision to make the most of whereas ready for higher entry factors. Nonetheless, it looks like this cash most likely would have been higher used simply shopping for the market however that is alternative price I’m keen to sacrifice.
I additionally bought I-Bonds in 2022 on the peak of inflation peak when I-Bonds had been paying 9.5%. The charges have come down considerably since then as inflation itself has come down. The optimum time for me to promote these bonds had been on Dec 1, 2023 as that might have been the final month I used to be eligible for the upper charge of 6.4% (nonetheless greater than what treasuries paid). As you need to forfeit three months of curiosity upon withdrawal earlier than 5 years, in complete my blended charge of return was round 8% for 15 months which is unquestionably one thing I can dwell with.
ETFs
Once more, my major holdings are in a number of ETFs. My major holdings are in VTI, VGT, and VCR. I’ve at all times been an enormous proponent of huge tech and have been closely invested within the Nasdaq for over a decade. This has paid off very effectively for me given the huge bull market of the 2010s and is basically what allowed me to FIRE so rapidly.
I used to carry extra dividend producing shares as I used to be actually into any such investing at a time frame. I at the moment don’t have many dividend particular ETFs as I want progress greater than earnings. This type of goes in opposition to the ethos of economic independence however I have the funds for coming in from different sources that I don’t must focus a lot on earnings.
I added to my ETF positions in April 2024 when the Nasdaq dipped about 6%. I like so as to add positions on dips and the pullback was sufficient of 1 for me to start out including to my place.
Single identify shares
A number of the single identify shares I personal are the next
- Tesla
- BRK.B
- Netflix
- RITM
- ASML
- ANET
These single identify shares make up lower than 10% of my complete portfolio. I are likely to not purchase a lot single identify shares anymore as there’s no level to tackle pointless dangers after I’m already so diversified with my ETFs.
Actual Property
I at the moment personal no actual property. I used to personal property within the US however have offered it in 2022 earlier than charges began rising. I’m not an enormous fan of actual property. Whereas it positively could be a good funding, I don’t assume it beats investing within the markets. As well as, actual property is very illiquid with excessive transaction prices that few folks think about.
Lastly, as somebody that travels world wide and doesn’t prefer to be tied down to at least one location, actual property doesn’t make sense as managing it from afar creates a bunch of complications. I a lot want to have my cash liquid and within the inventory market.
April 2024 lastly noticed the markets come again right down to Earth. The bull pattern that began in November 2023 which confirmed no indicators of stopping lastly noticed a little bit of actuality as inflation remained sticky and the FED introduced they might be far more reserved on the prospect of charge cuts. At first of the yr, there have been predictions of as much as 2% in charge cuts by the tip of the yr! Now, that has been tempered method down and there’s just one charge reduce forecasted (0.25%) for your complete yr.
As you may see from the beneath screenshot which I at all times monitor utilizing the CME Fed Fund Futures web site, the anticipated charge in Dec 2024 is at 5.25% (simply 0.25% beneath the place we’re at present) which implies only one charge reduce. I might see this altering to no charge cuts very quickly if inflation nonetheless stays sticky.
As you may see from the chart beneath, the Nasdaq has been on this good upward channel for the reason that Oct 2023 lows with even the slightest dip being met with consumers. That every one modified in Apr 2024 because it lastly broke out of this channel and is now consolidating earlier than what I feel will likely be some huge strikes in Could 2024.
In April, markets dipped by a max of seven% on the Nasdaq and about 5% on the S&P 500. This can be a wholesome pullback for my part because the market digests inflation and earnings information. Earnings have largely been fairly good with the foremost firms matching their expectations. This market has largely been propped up by the Magazine 7 shares that are nonetheless doing effectively except for Tesla which has been lagging.
I think volatility in Could will enhance. Usually, Could has been a weak month; the mantra of “promote in could and go away” is a factor for a cause. I might not be shocked to see markets consolidate additional and even dip earlier than a rebound close to the tip of the month. I’ll proceed to purchase any dips.
Market Worth of Portfolio
Here’s a historical past of my portfolio worth. As you may see, it’s moved in step with the markets as must be the case since most of my holdings are in ETFs that observe the S&P 500 and the Nasdaq.
Ticker | Amount | Market Worth |
VGT | 1450 | $717,359 |
VTI | 2080 | $517,109 |
VCR | 400 | $120,360 |
VDC | 300 | $60,240 |
TSLA | 100 | $18,328 |
TQQQ | 1000 | $52,740 |
FBGRX | 400 | $77,380 |
VHT | 250 | $64,010 |
RITM | 2500 | $27,800 |
ANET | 35 | $8,980 |
ASML | 50 | $43,624 |
Whole Shares | $1,707,928 |
In complete, my portfolio is sitting someplace round $1.86m which additionally contains money and stuck earnings positions. This most likely be over $1.9m if it weren’t for my lined name MTM losses.
Trades executed for the month of April 2024
April was an lively month for my buying and selling regime. I offered a money secured placed on IGM as a result of I need extra publicity to totally different tech shares. Whereas most of my portfolio is in VGT, that is primarily uncovered to Apple, Microsoft, and NVDA. These are nice names in fact however I need extra publicity to Google, Amazon, and Meta. I might simply purchase the shares outright however I nonetheless attempt to decrease my holdings to single identify shares.
My earlier VGT calls had a strike of $480 which I rolled to $510 with a maturity in Aug 2024 final month. The underlying value of VGT has moved beneath my new strikes so I form of want I didn’t roll my earlier contracts to such far off date.
Throughout the month of April 2024, I additionally purchased extra VGT and VTI.
Abstract of inventory and ETF purchases
Ticker | Transaction | Amount |
VGT | Purchase | 8 |
VTI | Purchase | 10 |
IGM | Promote Put @ $79 | 2 |
Portfolio withdrawals and bills
Withdrawals from my portfolio is a crucial a part of the monetary independence ethos. The 4% withdrawal charge rule is likely one of the major ideas of the FIRE motion which I attempt to adhere to. Usually, I want to promote from my portfolio when markets are close to or in any respect time highs to seize, and solely after I really want the money.
For the month of April 2023, I traveled to Seoul, Korea which marked nation #94 for me. I additionally spent a while in Japan which was superb given how a lot the Yen has depreciated. It actually felt low-cost particularly in comparison with my final go to again in 2015 when the USDJPY was round 110.
I made no withdrawals from the portfolio as I had sufficient money coming in from my weblog in addition to leftover money from different sources. My weblog generates cash each month to the tune of $3-4k and I cowl precisely how I earn cash from running a blog in different posts.
Dividend Revenue
For April, I collected a complete of $800 in dividends. I usually reinvest my dividends which has served me effectively through the market downturn of the final yr or two. I feel I’ll most likely cease reinvesting dividends within the close to time period as I prefer to hold a money pile whereas shares are in any respect time highs to reinvest when markets finally dip.