Monday, June 10, 2013

Financial Independence Portfolio performance


Recently I stopped getting excited about size of my portfolio, but rather aim to focus on what is can generate for me in terms of dividends.  Now it is 3% annually. The funny thing is, even if the net worth goes up, the yield  is going down.

My understanding that with the bull market and funds are chasing performance, more and more companies are pulling out from TIPS (Treasury Inflation-Protected Securities) and putting money in the stock market.

The average yield on lowly rated corporate debt, or junk bonds, recently dipped below 5 per cent to a record low that is less than US Treasury bonds yielded in 2007.

I came to realize that for the financial independence size of the nest egg is of little importance.  Difference from a retirement portfolio is that I am not going to sell it to buy annuity.  For financial independence, the nest egg should be able to generate enough money to cover expenses and compensate for the inflation.  Inflation affects not only expenses but the principal (nest egg) as well.

Sunday, June 2, 2013

May 2013 update ($246,730 +$8,400 or + 3.5%)



The portfolio changes:
Accumulated additional 3,500 USD as part of my annual savings goal.
Gazprom (GAZ:FRA) is up by 600 USD
Vanguard VDE is up by 1,900 USD
Vanguard VOO is up by 500 USD
Company shares are up by 470 USD
Grand total additions:  6,970 USD

Rosneft lost 520 USD
Grand total losses are:  520 USD