It’s spreadsheet weekend and time to look at my portfolio again. I like looking at my portfolio monthly not only because I like seeing the numbers go up but also because it helps me see where I am against my asset allocation.
That key piece of info allows me to target next month’s contributions strategically and/or shift some assets that have performed too well so I’m always buying asset classes that are lagging behind. Taking advantage of a divergence in asset allocation doesn’t require a monthly review but I happen to like spreadsheet and numbers so it’s not a bother for me.
The S&P 500 had the best months since last December with a 3.42% return and continues to show no sign of stopping taking the YTD return to just a bit under 14%. That’s certainly meant good things for my portfolio and I’m thinking the S&P 500’s performance will continue my run of positive months.
For those keeping track, my portfolio has now had 12 straight months of growth and 6 of those months grew by more than $10,000. I know this type of market won’t be around forever but I’m enjoying the ride up for now.
It’s time to take a look at my portfolio today.
As a reminder, last month’s total had me just a hair under 450k at $448,776.58.
My portfolio now sits at $459,952.98!
I broke 400k in April and am now past 450k in October which is just crazy given that my savings rate this year has been a bit lower than I’d like it to be. There’s no denying that a good portion of that amount is due to my contribution but most of it is driven by strong returns.
I’m now at 13 months of consecutive growth and this is the 7th month within that period that has shown growth greater than 10k in a month.
It was a great month on a dollar basis but my portfolio actually lagged the S&P 500 this month with a 2.49% increase and that was inclusive of contributions.
My largest individual holdings(APPL and UNH) were flat or negative and REITs had a negative return as well. That’ll lead to under performance especially since I have some bonds as well which will always lag during strong equity return months.
My taxable accounts were still up 2.45% despite the poor performance from some of my individual holdings although some of that was due to my recent purchase of MSG stock.
My tax-advantaged accounts were up 3.22% driven by solid stock returns and contributions in my 401k.
Cash was down 4.3% as I put some of that capital to work and now makes up 6.25% of my overall portfolio.
It’s great to see my portfolio break another threshold and I’m eager to see the day when I can call myself a half millionaire. I’m technically probably already on there on a net worth basis due to my emergency fund and house fund but I don’t consider those for the purposes of my early retirement portfolio as they’re just future expenses.
If the stock market keeps chugging along, it’s possible I can hit that mark around April of next year which would be pretty awesome.
I was at 290k when I started tracking this in December 2015. Since then my portfolio has gained over 160k in less than 24 months to put me at today’s total. That’s almost a bigger gain than my gross income in that period(it’s bigger if you don’t account for bonuses). If that doesn’t speak to the power of keeping your money in the market then I don’t know what does.
Let’s take a look at my asset allocation.
I had some small-cap and mid-cap issues last month so most of my money went into those two asset classes.
Here’s the breakdown of each asset class versus target.
- US Large Cap at 42.82% versus 42.5% target(+0.32%)
- US Mid Cap at 10.13% versus 10% target(+0.13%)
- US Small Cap at 10.14% versus 10% target(+0.14%)
- US REIT at 9.67% versus 10% target(-0.33%)
- International Developed at 15.03% versus 15% target(+0.03%)
- International Emerging at 4.91% versus 5% target(-0.09%)
- US Bonds at 7.3% versus 7.5% target(-0.22%)
Small caps gained nearly 6% in the last month and that combined with the additional contributions in the past two months has driven my small cap allocation above target. The MSG purchase and decent mid cap performance has done the same for that asset class.
International continues to be in a good spot although international equities lagged US gains a bit causing a bit of a reduction versus their positioning last month.
REITs had a tough month due to fears of rising yields and that didn’t help bonds either. I did purchase some more bonds last month but strong performance in equities means that asset class has continued to fall behind.
That means the plan for next month will be as follows:
- Contributions flow into REITs and bonds.
None of the asset classes are too far out of whack so I feel comfortable in just redirecting my contributions versus the alternative which would be selling something in an overweight class to put money into an underweight class.
I always prefer that method as it’s easier and less labor intensive on my part. It’s almost more tax efficient if I ever have to sell anything in a taxable account which is rarely the case. I still have plenty of cash on the side right now that makes it easy to shore up such small shortfalls via additional purchases.
The REIT and bond contributions should help my portfolio yield a bit and will mean higher dividend payouts, something that should help me reach at least my bronze annual goal of $8000 this year. My recent dividend update has me on good pace as I just hit 5k after September and I still December coming up, the biggest dividend month of the year for me.
I’m glad to see all these positive results and am especially happy with the positive progress within my portfolio. I’m keeping my asset allocation pretty in line with where I want it to be and these monthly posts are key in helping me do that. The bigger numbers certainly don’t hurt my motivation either as seeing the portfolio flourish like this is exciting and speaks to the power of my investing strategy.
That’s it for this month. How was September for you, are you reaching new heights as well? Please let me know in the comments below.