Investment Portfolio Update (first half 2020)
Welcome to my very first Investment Portfolio Update! Hopefully the first of many.
Through my Investment Portfolio Updates, I keep you posted on my total portfolio value, my portfolio holdings and, most important of all, my passive income progress.
As a European investor, I track my investment portfolio primarily in euros but my portfolio is diversified and many (most) of the holdings are USD denominated and listed in the US.
I consider my portfolio to be a global one, albeit with an EU investing twist.
The main objective, generate (relatively) passive income that increases every year. This is Here Income after all.
Wherever you are reading from, I hope you that you will find this portfolio update, covering the first half of 2020, useful.
OK, enough with the intro, let’s see some numbers and thanks for joining me for the ride!
My investment portfolio value
Happy with the progress! Especially in the current economic climate. And, it looks like I’ve hit the 200K portfolio value milestone for the first time!
But my real target for this year is to hit 200K in “total cash deposited in investment accounts”.
That’s how I look at it for my portfolio. Cash deposited is within my control and decoupled from the volatile markets we live in.
Nevertheless, I’m a bit shocked at how the markets have held up in the face of this unprecedented crisis, but I digress.
One of the main highlights during this period is that the fact that I’ve invested 54,000 euros of my hard earned cash so far in 2020, a record.
I funneled in quite a large chunk of cash that I had sitting on the sidelines from late February to April to take advantage of the low prices, on top of my regular monthly investment plan (which uses the Dollar-Cost Averaging strategy).
Unfortunately, I started getting into the market a bit too early in late February and invested in some of the companies most impacted by the crisis as I thought that it wouldn’t turn out as bad as it seemed. I “bought the dip” and… I was wrong.
But I also managed to get some true bargains in March that I’m significantly up on. So i’m happy with that. In any case, timing the market perfectly is impossible. Broadly speaking, I’m satisfied.
It’s time to look into my portfolio holdings.
My Portfolio Holdings
I try my best to diversify my investments (within reason) into different types of assets as each presents unique characteristics.
Most of them deliver a great income too! (if you’d like more details on income investing, I invite you to consult my Ultimate Guide to Building an Income Portfolio)
My portfolio is comprised of the following types of investments:
- Exchange Traded Funds (ETFs) – as a European Investor, I’m limited to EU-listed ETFs. I invest in both accumulating (to reduce tax impact) and distributing ETFs, across providers.
- Individual stocks – mainly in high yield dividend stocks and dividend growth stocks in the US but I also have EUR stocks and GBP stocks. I also hold some non-dividend paying stocks.
- Real Estate Investment Trusts (REITs) – primarily invest in the US, but also in European REITs
- Preferred Shares – exclusively in the US and I invest primarily in REIT preferred shares
- Closed-End Funds (CEFs) – exclusively in the US and I primarily target less accessible fixed income investments such as mortgages, loans, bonds and preferred shares
- Bonds – exclusively in the US due to higher prevailing USD interest rates.
- P2P Lending – exclusively in EUR, across two platforms based in the Baltics
Equities and funds holdings
The table below lists my ETFs, individual stocks, REITs, Preferred Shares and Closed-End Funds. There’s 46 holdings in there!
My bonds, P2P investments and cash remaining in my investment accounts are tracked manually and in another format. They are presented further down.
| Ticker | Company | Shares | Cost basis | Market Value | Gain/Loss | Type | Currency |
|---|---|---|---|---|---|---|---|
| AAPL | Apple | 9 | $1,499.84 | $3,283.20 | 118.90% | Stock | USD |
| CCI | Crown Castle International | 25 | $2,723.06 | $4,183.75 | 53.64% | REIT | USD |
| HD | Home Depot | 10 | $1,840.45 | $2,505.10 | 36.11% | Stock | USD |
| TXN | Texas Instruments | 28 | $2,658.40 | $3,555.16 | 33.73% | Stock | USD |
| AMH-D | American Homes 4 Rent Pref. Series D | 100 | $1,937.00 | $2,545.00 | 31.39% | Preferred | USD |
| FB | Facebook Inc | 19 | $3,287.05 | $4,314.33 | 31.25% | Stock | USD |
| ITW | Illinois Tool Works | 22 | $2,939.97 | $3,846.70 | 30.84% | Stock | USD |
| ETR:VNA | Vonovia | 110 | €4,830.12 | €6,003.80 | 24.30% | REIT | EUR |
| AVB | Avalonbay Communities | 24 | $3,036.09 | $3,711.36 | 22.24% | REIT | USD |
| MAA | Mid-America Apartment Communities | 16 | $1,508.62 | $1,834.72 | 21.62% | REIT | USD |
| BME:AMS | Amadeus IT Group | 75 | €2,886.00 | €3,478.50 | 20.53% | Stock | EUR |
| O | Realty Income | 60 | $2,962.26 | $3,570.00 | 20.52% | REIT | USD |
| DLR | Digital Realty Trust | 20 | $2,394.51 | $2,842.20 | 18.70% | REIT | USD |
| BME:IBE | Iberdrola | 325 | €2,837.60 | €3,354.00 | 18.20% | Stock | EUR |
| CSCO | Cisco Systems | 110 | $4,455.91 | $5,130.40 | 15.14% | Stock | USD |
| AMS:VWRL | Vanguard FTSE All-World UCITS ETF | 243 | €16,946.41 | €18,621.09 | 9.88% | ETF | EUR |
| UTF | Cohen & Steers Infrastructure Fund | 160 | $3,331.20 | $3,528.00 | 5.91% | CEF | USD |
| REXR-C | Rexford Industrial Realty Pref. Series C | 45 | $1,091.70 | $1,138.50 | 4.29% | Preferred | USD |
| ETR:AT1 | Aroundtown | 208 | €1,017.51 | €1,060.80 | 4.25% | Stock | EUR |
| LON:ULVR | Unilever | 30 | £1,253.51 | £1,306.50 | 4.23% | Stock | GBX |
| MNR | Monmouth Real Estate Investment | 125 | $1,739.94 | $1,811.25 | 4.10% | REIT | USD |
| DLR-L | Digital Realty Trust Pref. Series L | 84 | $2,039.52 | $2,114.28 | 3.67% | Preferred | USD |
| RLJ-A | RLJ Lodging Trust Pref. Series A | 351 | $7,504.38 | $7,683.39 | 2.39% | Preferred | USD |
| FFC | Flaherty & Crumrine Preferred Securities | 100 | $2,010.00 | $2,011.00 | 0.05% | CEF | USD |
| BHK | Blackrock Core Bond Trust | 160 | €2,478.40 | €2,459.20 | -0.77% | CEF | USD |
| FRA:H4ZJ | HSBC MSCI World UCITS ETF | 670 | €13,197.46 | €13,044.90 | -1.16% | ETF | EUR |
| T | AT&T | 190 | $5,832.53 | $5,743.70 | -1.52% | Stock | USD |
| BAM | Brookfield Asset Management | 50 | $1,670.50 | $1,645.00 | -1.53% | Stock | USD |
| NLY-I | Annaly Capital Management Pref. Series I | 50 | $1,076.00 | $1,057.00 | -1.77% | Preferred | USD |
| HPI | John Hancock Preferred Income Fund | 95 | $1,893.35 | $1,858.20 | -1.86% | CEF | USD |
| MNR-C | Monmouth Real Estate Investment Pref. Series C | 120 | $3,009.60 | $2,934.00 | -2.51% | Preferred | USD |
| PTY | Pimco Corporate & Income Opportunity Fund | 125 | $1,991.25 | $1,938.75 | -2.64% | CEF | USD |
| FRT-C | Federal Realty Investment Trust Pref. Series C | 40 | $1,013.60 | $984.00 | -2.92% | Preferred | USD |
| NZF | Nuveen Municipal Credit Income Fund | 125 | $1,913.75 | $1,845.00 | -3.59% | CEF | USD |
| AMS:EMIM | iShares Core MSCI Emerging Markets IMI UCITS ETF (Acc) | 383 | €9,560.45 | €9,207.32 | -3.69% | ETF | EUR |
| PCI | Pimco Dynamic Credit and Mortgage Income Fund | 92 | $1,785.72 | $1,695.56 | -5.05% | CEF | USD |
| AMS:VFEM | Vanguard FTSE Emerging Markets ETF | 97 | €4,917.18 | €4,661.82 | -5.19% | ETF | EUR |
| AMS:VEUR | Vanguard FTSE Developed Europe UCITS ETF | 255 | €7,554.86 | €7,147.65 | -5.39% | ETF | EUR |
| EFR | Eaton Vance Senior Floating-Rate Trust | 170 | $2,057.00 | $1,924.40 | -6.45% | CEF | USD |
| GNL-B | Global Net Lease Pref. Shares Series B | 80 | $1,980.00 | $1,848.00 | -6.67% | Preferred | USD |
| AMS:IWDA | iShares Core MSCI World UCITS ETF (Acc) | 196 | €11,263.14 | €10,329.20 | -8.29% | ETF | EUR |
| MAIN | Main Street Capital | 140 | $4,974.04 | $4,358.20 | -12.38% | Stock | USD |
| LON:LGEN | Legal and General Group | 1,480 | £3,738.97 | £3,269.32 | -12.56% | Stock | GBX |
| BRK.B | Berkshire Hathaway | 34 | $6,964.90 | $6,069.34 | -12.86% | Stock | USD |
| VTR | Ventas | 70 | $2,984.49 | $2,563.40 | -14.11% | REIT | USD |
| LON:RDSB | Royal Dutch Shell | 227 | £3,971.83 | £2,778.48 | -30.05% | Stock | GBX |
| EPR | EPR Properties Trust | 60 | $2,974.10 | $1,987.80 | -33.16% | REIT | USD |
| AMS:URW | Unibail-Rodamco-Westfield | 40 | €5,025.46 | €2,006.40 | -60.08% | REIT | EUR |
Bonds
For my bonds, I decide to track them at their face value and not current market prices because I intend to hold them until maturity. I currently own two REIT bonds with a face value of 8,000 USD, which is what I will get when they both mature sometime in 2023.
I have bought these bonds at a discount, 7,170 USD to be exact, so I will also get a nice capital gain upon maturity in addition to the enhanced yield that I get for buying them at a lower price. They’re non-investment grade bonds but i’m comfortable with them surviving until 2023.
P2P lending
I’m so happy I resisted the urge to go crazy on P2P and diversify across many platforms since quite a few European platforms have gone bust or are having issues due to the pandemic.
I choose to stay concentrated into the best platforms with a relatively low percentage of my investment portfolio. For me, these “best platforms” are, for now, Mintos and EstateGuru.
Mintos
I’ve slowly been withdrawing money from Mintos throughout the COVID-19 pandemic since I’ve been able to find alternative opportunities in the public markets that are much more attractive from a risk reward perspective.
I’ve withdrawn 2,500 euros so far from my initial 7,500 euros investment. I’ve just paused my auto-invest settings and I’m letting cash accumulate to 500 or 1,000 euro before withdrawing.
I’m lucky that so far I’ve been mostly spared from some of the Load Originators that have gone bad. I only invest on the Loan Originators with the best credit and quality ratings.
EstateGuru
I also have an account with EstateGuru mostly to further scratch my real estate itch. I’ve only deposited 1,000 euros so far and have no plans at the moment to increase it further.
I only invest in loans with monthly interest and, with my low investment, I am experiencing quite a bit of cash drag.
This is because I have to wait until I have 50 euros to invest (that’s the minimum investment amount into a particular loan) and then, when it’s available, wait some more for loans that provides monthly interest.
I might eventually balance my portfolio 50:50 across Mintos and Estate Guru.
Here’s the overview of my P2P Lending accounts
I plan to reduce my Mintos investment by another 1,000 euros so as to have only 5,000 of my deposited cash tied up in P2P for the foreseeable future. I want to keep a pulse on the space and see how it evolves.
Given the high yields on P2P, my withdrawals will definitely reduce my income growth rates for 2020 but that’s OK.
Cash
Finally, here are the cash holdings in my brokerage accounts (this does not include my emergency fund and other cash that I have in savings accounts).
Quite a bit in there so I’ll need to put it to work once I find some enticing opportunities, either in my existing portfolio or in new investments.
I need to make sure my portfolio remains manageable. There’s quite a few holdings in there but only my individual stocks and REITs require quarterly monitoring.
For the rest, I kind of let them run and take a deeper look if there’s a huge jump or fall in price.
Having gone over my holdings, let’s now take look at my portfolio diversification.
Portfolio diversification
There are many different ways to assess your portfolio diversification levels. I choose to do it by “investment vehicle” because that’s how I look at it right now and I feel that the characteristics of the vehicle dominates other factors such as market cap, region, etc.
Now let’s see my portfolio diversification at the end of June 2020 in action. As I track my portfolio value in euros, all numbers are adjusted to euros at the interest rate of the time the snapshot was taken.
Now let’s see it in percentages, this blog is the only reason I eventually got around to doing the exercise ! It’s been on my to-do list for years ! Life (and investing) can get in the way.
ETFs largest holdings, check, no over exaggeration on my REITs, Preferred shares and Closed End Funds, check. Cash in brokerages, need to keep looking for those opportunities!
Now let’s see my diversified portfolio from the currency perspective.
Now, let’s adjust the USD and GBP values to EUR and compare them.
As you can see, quite a big exposure to USD and this is not even representative of my real underlying exposure. For example, my ETFs listed in EUR have a very significant USD allocation and many of my stocks have global currency exposure.
My large USD exposure does not concern me because I’ve already got huge exposure to the EU and its economy, just by being based there. My job, my savings, my pension and the equity in my home, they’re all in the EU.
I might need to do a post on how I look at currencies in the context of my portfolio and personal situation.
Passive income for 2020
Saving the best for last, this is Here Income after all, I present you the breakdown of my Passive Income for H1 2020 and how my average monthly income compares to 2019.
Wow! I did not expect it to so much greater than my average monthly passive income of 348 euros in 2019, 42.5% greater in fact. However, before I get too excited, I need to remind myself that I’ve suffered a few dividend cuts during this pandemic and many of my ETFs have their biggest pay out in June.
Let’s see how it’ll end up at the end of the year, hopefully my continued investing throughout the year will counteract this.
In any case, the results are finally starting to feel meaningful for me!
I can start to feel the compounding machine of new money and reinvested dividends / interest starting to take hold. Generating a steady and reliable passive income from investments takes time and discipline. But eventually, you’ll start seeing results.
Bring on the second half of 2020!
And this wraps up my very first Portfolio Update. I hope that you enjoyed it, thank you and stay tuned!