Portfolio update #5 (f🔐); 5% divi portfolio
Update on the overall 5%-yielding portfolio, and the 7%-yielding HK sub-portfolio +++ Jam's investment goals & philosophy
Disclaimer (thank you and )
This is neither a recommendation to purchase or sell any of the shares, securities or other instruments mentioned in this document or referred to; nor can this presentation be treated as professional advice to buy, sell or take a position in any shares, securities or other instruments. The information contained herein is based on the study and research of
and are merely the written opinions and ideas of the author, and is as such strictly for educational purposes and/or for study or research only. This information should not and cannot be construed as or relied on and (for all intents and purposes) does not constitute financial, investment or any other form of advice. Any investment involves the taking of substantial risks, including (but not limited to) complete loss of capital. Every investor has different strategies, risk tolerances and time frames. You are advised to perform your own independent checks, research or study; and you should contact a licensed professional before making any investment decisions. The author makes it unequivocally clear that there are no warranties, express or implies, as to the accuracy, completeness, or results obtained from any statement, information and/or data set forth herein. The author, shall in no event be held liable to any party for any direct, indirect, punitive, special, incidental, or consequential damages arising directly or indirectly from the use of any of this material.
Introduction
Several subscribers requested more portfolio insights and updates. In response, I am revealing further details on my portfolio (for founding members). Fun fact for dividend-minded investors; the overall portfolio is currently generating a dividend yield of around 5%, and the Hong Kong (sub-)portfolio c7% and even 8% on cost price.
By way of background, I’ll start this post with a write-down about my journey in investing, and the evolution in how I manage my portfolio.
Investment goals & philosophy
Become aware; In 1998, I first started investing because I wanted to become more aware of what was going on in the world. I felt that if I had some money in stocks. Those stocks would start to move up and down, …. and then, surely I would start to follow the news to figure out what was going on. And so, it happened. I became hooked on soaking up news, insights, …. and I became hooked on investing itself.
Hobby; A new hobby / passion was born. One that actually grew into landing a job in investing as well. The hobby had grown a bit out of hand.
Investment returns; Obviously making good investment returns has been an important objective too. I owe a considerable portion of my net wealth to my investment returns thanks to a six-fold + increase in the cumulative amounts of money that I have put to work over two decades. This was despite the large ‘tuition fees’ I paid by learning from big mistakes (or just one huge cumulative mistake) in the years after the tech bubble burst in the early 2000’s.
I don’t have a specific target return in mind. I just try to collect the returns that the market hands me, when I think the risk/rewards are highly in my favor. The easiest returns I made were with
Mass fear. Such as coming out of the Great Financial Crisis (GFC) after 2008, and in the recovery from the initial covid-19 crash in February/March 2020, and with
High conviction stock ideas, in which I can allocate sizeable portfolio weights. Three of these (closed) ideas account for an outsized portion of my cumulative investment returns, as is natural in investing. Ask Warren Buffett.
Income; Since about 2020, I have started to shift my portfolio to create (dramatically) more dividend income. It was a bit of a lucky coincidence;
Strong opportunities have been presenting themselves, with the conservatively-run Dutch insurer ASR Nederland in 2020, Energy and Emerging Markets stocks (Petrobras, Halyk Bank, Okeanis Eco Tankers, etc.) in 2022 - 2023, and most recently Hong Kong stocks.
Desire for more security; Dividend income provides me piece of mind because it can pay a lot of bills, if needed. It provides more stability of (direct) investment returns, vs the dependency on share price gains with non/low-dividend stocks. Finally, high dividend yields have been critical for me, in building the conviction to buy very cheap stocks in far away places (Kazakhstan, Brazil, etc) and in highly cyclical industries. High dividends dramatically reduce fraud risk, and the risk of permanent loss of capital.
Diversification; Also since around 2020, I have started to further diversify the portfolio. I still found a lot of good investment ideas. Just nothing I felt comfortable putting a lot of weight into, ie 5-20% weight at cost. Most of the additions in recent years have been smaller weights at cost, mostly due to the cyclical nature of the companies, higher country risks (in emerging markets), and/or the immature stage of the company in its economic life cycle. On the upside, more diversification provides
Reduced risk which also helps to create a more dependable dividend income stream, and
Ability to play long-tail stocks, stocks with long-runway potential, and typically above average risk profiles. Biorem and Sintana have been such names, and I wrote about another one, here (for founding members).
Usually, I hold a large cash position, both inside my investment account and outside the investment account. That helps my mental power to stay-in-the-game when times get rough, and it provides the financial flexibility to act on big market (or individual stock) dislocations.
Most-recent portfolio updates
2024/05/31: Portfolio; increased disclosures from below 60%, to now 75% of the portfolio. These are the positions above 3-4% weight, and the key stocks on this substack.
2024/05/31: Kong Kong (sub-)portfolio; full disclosure, no changes this time
Should you have missed the chance to upgrade to the Founding membership, and want access to the Founder content. Just contact me.