Portfolio Update #20 July 2020 – 101,729€

Hola Macarenos and Macarenas 🙂 and welcome to my portfolio update for July 2020, this one being already the 20th!

As I am writing this it’s 30 34 degrees, as a heatwave has stepped on us. The area is pretty overpacked, more than usual over this time I’d say, and I’ve seen some tourists doing weird things, such as sunbathing while wearing lots of makeup (lots means lots!), or groups of young girls in high hills falling down on the promenade because of being drunk (they seem to have fun though!) and some teenagers drinking all over the place (also called botellón in Spanish) among others. The only thing we need now is building a Disco like Pacha so we can turn this into another Ibiza!

Boris! Remove the quarantine restrictions with Spain. This is an emergency! 😉

So far, I have surprisingly not drunk beer (yet) just had a few ice creams and ice coffees. Mr Belly is happy for now, but it will be soon asking for more. It’s a greedy one! (perhaps like his owner?)

But let’s better dig into how my other belly is doing.

Quick Recap of July Numbers

• Portfolio value: 101,729 € (1.37%) – details HERE
• Monthly Transactions (Deposits – Withdrawals): 1,828 €
• Monthly growth from investments: -1,026 €
• Passive income: 138 € – details HERE

In spite of the negative gains, I am still above 100K, which satisfies me.

The monthly and total rate of returns break down as follows:

Portfolio Performance

Please note, links containing a star (*) are either affiliate or referral links. P2P lending is a risky business, so you could end up losing all your invested money if you choose to join any of these platforms.

** 20 % discounted as estimate future withdrawal tax payments

Except for my UK Pension, stocks in July declined slightly. The US Dollar devaluation against the Euro and Pound is not contributing favorably to my portfolio value lately.

Commodities such as Gold or Silver have had a significant increase in price as investors are worried about the dollar devaluation and the future values of inflation.

I am a very big fan of Ray Dalio’s All-Weather Portfolio, which includes a 15% stake in commodities. The objective of this portfolio allocation is to minimize volatility during all types of market conditions, while still getting a nice return on your investments. In the last 10 years, this portfolio gained around 8% compound annual return, with a 5.7% standard deviation. That percentages look great considering that it’s a 100% hands-off strategy.

In spite of that, as I am in the accumulating phase of my journey, I still rather focus my investing strategy on global funds. I’ve seen some people buying gold desperately as if there was no tomorrow. Not because an asset is trendy means you need to go and buy it at any price. That’s the perfect receipt to end up losing the plot and eventually also your money.

Alternative Investment Portfolio

My alternative investment portfolio gets smaller as time goes by, as I continue withdrawing funds from many platforms.

Most of my passive income this month comes from my P2P investments. That is 124 EUR out of 138 EUR, or put differently, 90% of my monthly passive income, as I got a nice income shot from Crowdestor.

In July, I managed to exit Evoestate. That makes my current P2P list shorter, going from 10 down to 9 platforms.

My level of contentment with the platforms I use goes as follows:

1. Crowdestate

I know some investors who are not happy with Crowdestate* due to some defaulted loans. My experience so far is different as I managed to sell all loans on the secondary before they defaulted. Maybe that was just luck, but it doesn’t hide the fact of me being happy with the results I’ve got so far.

One of my investments exited successfully in July (Suure-Pärna, Liikva), giving a final IRR of 11.6%, as expected.

For the first time in a long while, I reinvested this money into another development project.

I am happy to keep my Crowdestate portfolio close to 2K.

2. Estateguru

Things keep running pretty well at Estategurus*.

My portfolio consists of 44 loans (52 last month), where 38 are being paid on time and 6 are late (10 last month). I have no defaulted loans so far and withdrawals are processed on the very next day. It is a shame there’s a 1 EUR fee per withdrawal execution though. I only withdraw once a month to avoid paying too much on fees.

If you want to give it a try, please consider using this link and get a 0.5% bonus on your investments made during the first three months.

3. EvoEstate

Even though I was happy with EvoEstate I decided to leave the platform. I originally had plans to add 5K as a rental property investment, but a lot has happened since then and I’ve now taken the decision to lower my exposure in the P2P industry. My account balance was only at 1.1K, so I just don’t think is worth the hassle for that money.

In July, I successfully sold all my remaining shares of two investments I had with Brickstarter. These were holiday rental properties in Spain. With the current situation, I think it is too risky to hold holiday rentals for the potential yield it provides, as tourism in Spain has been badly hit and we don’t know how or when it will recover.

However, EvoEstate offers many other investments on their platform. So, property investors can find some opportunities they may like, from BTL to developments loans from all around EU.

If you want to give EvoEstate a try then please consider using this link* and get a 15 Euros bonus.

4. Crowdestor

I have a good feeling about Crowdestor*, but that’s all I have, just a feeling that can change overnight.

One of my investments paid a nice chunk of interest after the initial 6 months of investment. That payment came actually a few months delayed, but that is comprehensible.

Having had a closer look at all my investments I can confirm that they are now all on track except one: Fertilizer Export Financing. However, I have been nicely kept informed about the situation and hopefully, I should be able to receive my money soon.

We are expecting to see a series of improvements during August, so I am looking forward to seeing those.

5. Robo.cash

Robo.cash* gave some income this month. All my remaining loans are long term and being paid on time.

Despite things going well, this is another platform I plan to leave to simplify things out.

6. RateSetter

RateSetter is having a tough year as it was forced to halve interest rates for the rest of 2020 in an attempt to stabilize their provision fund. Obviously this is better than facing bankruptcy or stopping all payments as Grupeer or Property Partner did.

The key risk indicators on the website show an interest coverage ratio of 67%, which is still quite low. This is a fundamental ratio to watch, as anything below the 100% means that the provision fund isn’t big enough to cover all interest payments in a case of default.

What is worrying is that the ratios don’t seem to be improving even after halving interest. No bueno!

Metro Bank has announced that is acquiring RateSetter. I’ve read some rumours saying that Ratesetter investors won’t be getting any new loans to invest in.

I am not very optimistic at the moment. I am hoping to get the £100 bonus soon and try to exit the platform.

Ratesetter is currently offering a £100 bonus when investing a minimum of £1000 if using my referral link. If I were in new investor shoes, I am not sure I’d risk it, but if interested, email me at tony (at) onemillionjourney (dot) com or a message me on Twitter.

7. Property Partner

Property Partner has extended the suspension of all dividend payments to the 30th of September.

That means that my money isn’t making any money, which sucks.

8. Housers

The Housers disappointment increases exponentially. Monthly income was 3 EUR out of 6,696.8 EUR invested.

The monthly income chart on my Housers page says it all.

Vague communication and failure to keep inventors informed leave this platform in a really bad position.

9. Fast Invest

With regard to the withdrawing issues, no improvements have been made from part of Fast Invest. I still did not get any of my pending withdrawals.

We were recently emailed to encourage us to cancel our withdrawal requests and reinvest this money with a premium. It’s a bit of a weird thing to ask. I am keeping mine as it is, although it is only a payout of 109 EUR.

I am surprised by the fact that Fast Invest is still up and running. I would have expected them to be gone by now.

Dividend Portfolio

July was another reasonably quiet month for my dividend portfolio.

This is the outlook of my holdings at the end of the month:

I am feeling more and more attracted to the dividend investing strategy. As I am still withdrawing cash from some P2P platforms, I am very tempted to automatically invest the money in dividend stocks. But I did promise to myself that my dividend portfolio would not surpass the 10% of my total invested assets. So, most “P2P cash” is going to my Trading 212 ISA to purchase Vanguard FTSE All-World (VWRP), although that includes a Euro / Pound conversion.

Dividend Payments

A super quiet month as I only received dividend payments from one company.

• Danone (KR): 13.61€

Total Income in May: 13.61 €

Danone finally paid its annual dividend to shareholders. As a French based company, the taxation of dividends works differently as US stocks. As a non-French resident I should only be subject to pay 12.8%. However, I was charged as if I was a French resident, a percentage that claims up to 30%.

Trading 212 automatically deducts the 30% to everyone on French stocks. I am still on the process to find out how to claim the difference back, but it may involve some hustle, which doesn’t seem to be worth for a few Euros.

Luckily I am within my £2000 dividend income allowance, so I don’t have to pay taxes in the UK. The double taxation wouldn’t be too exciting.

I still like Danone as a company, so I don’t think I will sell my shares, but I don’t think I’ll buy more either until I clarify this a little further.

New Holdings And Purchases

• 5 Unilever (UNA) shares @ €46.92

• 7.7 Walgreen Boots (WBA) shares @ $39.65

• 1 National Grid (NG) @ p895.0 *FREE SHARE*

• 1 National Grid (NG) @ p911.2 *FREE SHARE*

• 1 AstraZeneca (AZN) @ p8592 *FREE SHARE*

In July, I only added some shares on two of my current holdings; Unilever and Walgreen Boots.

I think Unilever is an important asset play in the Eurozone. I just introduced it in June and I think it deserves more attention within my portfolio. It is also a great stock to diversify across the Euro currency.

Walgreen Boots reported the third-quarter results. COVID-19 impact was significant in the UK market (Boots shop), which resulted in non-cash impairment charges of $2 billion and a year-over-year loss per share of $1.95. This caused the share price to drop from the $42ish to the $39ish. I considered this as a buying opportunity as I believe the impairment charges is a one-time event.

In addition, they announced a quarterly dividend increase of +2.2%. This dividend aristocrat is putting a lot of effort (money) on increasing their online business side. I keep hearing a Boots ad on the radio that encourages people to purchase online through their website. The bad side to this is that many Boots stores are closing and many jobs are vanishing. Considering their tight profit margin, I don’t think they are left with many other options.

For those interested in knowing more about Walgreen Boots, Derek from engineermyfreedom.com wrote an informative article about the company.

This is their corporate video:

The €45K Project Fund

Another month, another £54 saved as a non-smoker and put in the 45K Project Fund.

Agrogen project is still in the funding process, so I contributed my funds to this project again.

There’s a new Community Municipal Investment (CMI) to raise money to build some rooftop solar power on council-owned buildings. It is a safe investment, it does good and sounds great until you see that the expected internal rate of return is only 1.2% for a 5 years investment when the UK gov is currently borrowing at 1.12%…

So far, I have recovered 2.45% of my loss = 1,103.1 EUR

43,896.9 EUR left to go.

I will get there, my friends, I promise!

Related content: How I FIRED 45k with algo trading, Investing Ethically, Recovering €45K through Investing in Myself First

This is it for this month, I’ll be back in September. Wherever you are I hope you have a great August. And cheers for reading, you are a star :D.