Happy New Year, everyone. The year 2021 went by so fast, especially the last couple months. But it is always important to set aside time to reflect and not to take anything for granted. Wishing you all a healthy and successful 2️⃣0️⃣2️⃣2️⃣
And now for this month’s special edition year end report, as the journey to financial freedom continues 💎
Like last year, the major US indexes all posted positive results in growth. But they were a little more aligned this year. With the Dow Jones ending up 19%, S&P 500 gaining 27%, and the Nasdaq posting a 22% increase. Mostly due to multiple expansions instead of increases in earnings.
Here is an interesting chart of another way to show the stock market gains throughout the years:
Which ends up looking something like this, in the more familiar layout: 📈
It’s funny on the stock app at least, that the whole early 2020 crash happened and recovered so fast it doesn’t even register on the all-time view anymore. It must take the moving averages or something 🤔 Looks like it didn’t even happen but I remember those days though, and how fast things can change.
The final calculation of the brokerage portfolio growth (with factoring out contributions) came out to approximately 22.5% on the year. Matching Nasdaq this time but coming up short of the S&P. Happy with the results though, as the brokerage portfolio is built more on the defensive side than a typical index, and it also carried a higher cash balance than usual for most of the year. But peace of mind is key, and I’ve noticed finding that right allocation changes with different life events.
Retirement account – 401k
Likewise, with a higher cash (and some bond) allocation than a pure 100% index approach, the totals for this account were 16.1% this year. Good but not great, and probably should just put the whole account on the VTI and chill 😎 path as there is a self-direct brokerage option available (for a monthly fee of course) but right now the equity portion is just in some small-large cap index funds. From someone who knows a little bit about finance, it’s like the plan operator makes it way more confusing and fee driven than it should be. Sad to see in this day and age so will be glad to move the money to a normal IRA account somewhere else on eventual termination of employment.
For someone new to investing, you really can’t go wrong just picking a regular online brokerage account and buying VTI or VOO index funds for the long term as they track this. It’s basically the savings account of the US at this point, as workers 401k’s or pensions are invested in the market in some way.
Overall, I am mixed on increasing market risk or trying to preserve value at the moment. But as you’ll see with the purchases made at the end, I tried to keep a long term view and went out with a bang for the year 💥
Below is the dividend income received during December: (Values are in USD)
ADM – 24.05
AVGO – 45.10
AWK – 48.20
AWR – 20.08
CHD – 26.51
DFS – 23.00
ESGV – 20.06
JNJ – 53.00
KLAC – 14.70
LPX – 3.60
MCD – 28.98
MMM – 37.00
MSFT – 19.22
NDAQ – 13.50
NEE – 5.78
O – 11.07
ONL – 9.57 (not really sure where this came from as this position was sold day of spinoff from O..)
RDSB* – 14.28
ROST – 7.98
SJM – 20.79
SJW – 23.80
SO – 42.90
STE – 6.02
TGT – 58.50
UNP – 23.60
UL – 29.85
V – 12.00
VTI* – 14.93
WM – 29.33
WTRG – 21.46
YUM – 8.50
ZTS – 5.00
December Dividend Totals: $722.36
Total Payouts: 32 (positions marked “*” are held in an IRA)
Month Increase YoY: 6.5%
This year felt like a rebuilding year in a lot of ways for monthly totals, but I’m expecting it to pay dividends (pun strongly intended) in the long term on both future returns and increases. And hopefully when that happens in full force, the lowest tax bracket will be available for those higher dividends.
**As a note, the November 2021 Dividend Income was $377.37 with -7.7% YoY as results were not posted last month.
December (& Nov.) Purchases:
Here are the recent buys made over the last couple months, mostly for allocation purposes for the sake of portfolio goals.
Started out with buying a few more KLAC shares, along with 40 shares of the similar named ticker KLIC for more semiconductor exposure. Added some KLIC to my KLAC, one could say…
Then added a few more shares of ADP and ABT to increase those positions.
Was able to buy 2 more shares of V under $200, but think I’m good on adding to that one for a while.
Added 25 shares of ATVI as a small risky value play for the year in the low 60s. May add more if it falls down to low 50s in the first couple months of the year.
Not a dividend payer, but bought 6 shares of CRM on the dip for more tech allocation. Something the port had been lacking.
Also added 14 shares of a new name Steris, STE, for a Healthcare sector buy and among other reasons, it has one of the nicest/cleanest 10 yr charts I’ve seen in a while.
Finished out with a couple regular index purchases to stay in the investing game.
Portfolio Top 13 Holdings:
- American Water Works Co Inc (AWK)
- Target Corp (TGT)
- Church & Dwight Co Inc (CHD)
- Microsoft Corp (MSFT)
- Johnson & Johnson (JNJ)
- Waste Management Inc (WM)
- Lowe’s Companies Inc (LOW)
- Visa Inc (V)
- Thermo Fisher Scientific (TMO)
- Broadcom Inc (AVGO)
- Accenture Plc (ACN)
- PepsiCo Inc (PEP)
- General Mills (GIS)
The new top position, AWK, was the result of a surprising drop in TGT share price in December, but I expect it to regain the top position back in January. (The Targets I’ve seen have been packed lately…) Not exactly sure why the market is pricing in a forward p/e of 18 for TGT, while a forward p/e of 46 for COST unless their growth rates start to go in opposite directions. But anyway, really wishing I would have added Costco at the low 300s earlier this year…
Another tech name I’ve been adding to, KLAC, almost made the list, but the Staples PEP and GIS have been so darn strong lately. Always a good problem to have though in the port.
Some other names that could see an appearance in this list are ABT, ADP, and ZTS in the new year, through purchases or organic growth.
Although the order of the top 13 holdings could always be improved, it is becoming increasingly harder to do so without selling part of the positions, but I like the general framework a lot more than last year in the leading names. And the market will sort it out I suppose anyway. I like to follow the “letting the winners run” approach unless something fundamentally has changed in the business. And there is also the capital gains tax reason too.
After one of the better months ever in regards to net worth growth, I’m excited but cautious for whatever 2022 brings, and ready for yet another year of investing to reach financial independence. Got to be getting close now if this keeps up. And as always, ready to buy whatever dip the stock market may bring.
Thank you for reading and best of luck in the new year 🐧
**new year, new post photo… This one was taken during a summer hike on a state park trail. Always good to get out in Nature and away from all the devices and screens.
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