Q1 review of my Vrijheid Fonds2018
Dear readers, fellow DGI’s,
The first quarter of 2018 is already behind us. Time really flies when you having fun. So here is my Q1 review of my Vrijheid Fonds. Lets see what the first quarter of 2018 brought us. Just as a reminder, see my blog post for my goals 2018.
With the first quarter 2018 in hindsight, it’s time for a formal quarterly review. Why do I do a year review, you ask? Well there are actually a couple of reasons (besides because its fun to write). By doing my own review periodically it will help me understand whether I’m on course to meeting my goals, or whether I need to change my strategy or tactics. It also helps me to stay focused on actively managing my Vrijheid Fonds. And I believe it helps me, through reflecting on the past, to be a better DGI.
If I look back at the first quarter of 2018, I can say that volatility is back! 2017 was a great year were the stock prices shifted up and down in a very narrow bandwidth. 2018 is really different. This gives hope for a new dip in the stock market and new buying opportunities.
Total Return
Okay now it is time to look at my Vrijheid Fonds (and how it was affected by this volatility). Lets start with some key statistics.
Some key statistics on my Vrijheid Fonds for 2018:
- Net Value at the start of 2018: € 90,894
- Net Value at the end of Q1 2018: € 88,166
- Fresh added new capital in Q1 – 2018: € 1,968
With these numbers we can calculate the growth of my Vrijheid Fonds in Q1 – 2018. In the past quarter, my portfolio’s total return was -5.06%.
Okay lets compare my return with the return of some major indices, you can see that my Vrijheid Fonds did a little bit worse than the indices this quarter
Now that we know how my Vrijheid Fonds has performed in the first quarter of this year, it is time to take a look at my four goals that I set for my Vrijheid Fonds in 2018
Goal 1: Receive €3,600 in dividends in 2018.
In the first quarter I received € 685.87 in dividend income. Normally the first quarter of a year is the slowest quarter. So for a slow quarter I’m very happy with this amount of passive income. At the end of the first quarter my projected dividend income for 2018 is €3,272.
| Dividend | Q1 | Q2 | Q3 | Q4 | Total |
| 2014 | 90,11 | 509,38 | 226,04 | 289,32 | 1.114,85 |
| 2015 | 323,04 | 634,43 | 401,28 | 414,83 | 1.773,58 |
| 2016 | 511,80 | 769,88 | 1.148,63 | 649,08 | 3.079,38 |
| 2017 | 673,10 | 923.18 | 726.82 | 758.06 | 3,081.16 |
| 2018 | 685,87 |
My reported dividend for Q1-2018 isn’t much higher than in 2017 as you can see in the table above. There are two major causes for this, as I already wrote in my month review for March 2018.
First Royal Dutch Shell has stopped the possibility to reinvest their dividend by mains of script dividend. Up on till the end of 2017 I recorded the dividend of RDS as gross dividend, because the script dividend was paid from the gross dividend. Now the possibility of script dividend has ended, I have to drip from my net dividend ;-( . And that is why from now on, I will state the net dividend from RDS in my overviews. And yes this differs 15%, which is approx. €20 on a quarterly basis!
The second cause is that my mutual fund: NN Euro Obligatie Fonds (Euro Bond Fund) will no longer issue a quarterly dividend from 2018 onwards. From this year on, the dividend payment will take place once a year. From now on, the dividend will be paid in July. For more information, take a look at my post on NN Euro Obligatie Fonds. Last year in March I received a total dividend of €38.78 from this mutual Fund.
So I’m still lacking a lot to reach this goal in 2018 ;-). When I set this goal, I forgot that RDS has informed me that they were stopping with their script dividend. And the second cause (NN Euro Obligatie Fonds) really caught me by surprise ;-( .
This all together makes it a real challenge to achieve this goal. If I take a look at the rest of this year, I project at least 4 new stock purchases of about (€ 1,200 or $ 1,500) in 2018. With an average of average yield of 2.5%, this will result in approx. € 90 of extra dividend. Ouch… with these numbers I will not reach my dividend income goal for 2018. In the next quarter I need to do a lot of thinking about this goal and if I need to be more realistic with this goal. Despite everything, I will still do my utmost best to maximize my dividend income for 2018.
In Q1 I have donated about €1,968 of fresh capital in my Vrijheid Fonds.
Grade: failing
Goal 2: More diversification in my Vrijheid Fonds
My Idea behind this goal is that I want to position myself appropriately to protect my Vrijheid Fonds and decrease my risk factor for when the markets really dip. In order to do this, I want to diversify geographically by investing more in European companies.
| 2017 | Q1 – 2018 | |
| NL/Europe | 32,24% | 33,95% |
| USA | 52,78% | 51,43% |
Geographical diversification 4/1/2018
Furthermore I want to decrease my overall equity exposure and increase my Bonds exposure.
| 2017 | Q1 – 2018 | |
| Stocks | 85,01% | 85,38% |
| Bonds | 6,37% | 6,92% |
| Mix | 6,79% | 6,67% |
| Cash | 1,82% | 1,02% |
Assets allocation at 4/1/2018
Diversification is what saves my Vrijheid Fonds when the markets will hit a financial storm
And of course I always strive for more/better diversification in sectors.
| 2017 | Q1 – 2018 | |
| Consumer Discretionary | 19,98% | 20,35% |
| Consumer Staples | 20,74% | 20,44% |
| Energy | 15,33% | 14,88% |
| Financials | 3,92% | 3,40% |
| Health Care | 5,77% | 6,48% |
| Industrials | 0,96% | 0,71% |
| Information Tech | 2,51% | 2,62% |
| Materials | 1,26% | 1,20% |
| Telecommunications | 3,57% | 3,23% |
| Utilities | 2,21% | 2,03% |
| REIT | 8,77% | 9,77% |
| Cash | 1,82% | 1,06% |
| Mutual funds | 13,17% | 13,82% |
| Total | 100,00% | 100,00% |
Sector allocation at 4/1/2018
The tables above show the different diversification of my Vrijheid Fonds at the start of 2018 and at the end of the first quarter of 2018. I don’t have a specific goal for these diversifications.
If we take a look at these tables, you can see a small adjustment in all three tables. I’ll keep working on these diversifications
Grade: Passing!
Goal 3: Invest a total of € 7,500 new cash
In order to let my Vrijheid Fonds grow, it needs fresh cash. This quarter I added a total of € 1,968 of fresh capital. Every month I bought a lit bit more than € 100 worth of mutual Funds for my “Safe-haven-sleep-well”part of my Vrijheid Fonds. And I bought one new stock – Bayer AG, just click on Bayer AG to read my buy-report. And I bought some extra Realty Income (O). Read this post for some more information about this recent buy.
If I keep this pace up, I will definitely reach this goal!
Grade: Passing!
Goal 4: Receive €300 from side hustles
In 2017 I received € 90 in total of side hustle income and I wanted to set a new record for 2018. I’m working hard on this and set my self a goal of at least € 300.
My current side hustles are:
- Google AdSense
- Bol.com
- Amazon.com
- Member’s Board
- Click hereto earn some extra cash with taking some surveys
4 out of 5 side hustle hasn’t paid out to me in the first quarter of 2018. I have accumulated revenues in these different accounts, but haven’t reached the required payout threshold. My Goolge AdSense and Euroclix accounts have almost reached their individual payout threshold and I think that in the second quarter I will reach these individual payout thresholds.
Only my membership of the member’s board paid money out to me. They paid out a total of € 270 in the first quarter.
For more information on my side hustle income see my latest report hustle report March 2018 2017.
To sum-up my progress in this goal; I will definitely reach this goal in 2018. I have to think to update this goal.
Grade: Passing!
This was my review of my goals that are related to my Vrijheid Fonds. I will do another review of the remaining goals, which are related to my website Polliesdividend.com, but first let’s have a closer look at the development of my Vrijheid Fonds in the first quarter of 2018.
Vrijheid Fonds
At the end of the first quarter of 2018, I have 23 stocks, 4 mutual funds and 1 corporate bond in my Vrijheid Fonds. I didn’t sell any stock of mutual fund in Q1-2018 and, as I already wrote, two new buys.
I had to accept one dividend cut and was pleased with 9 increases in the first quarter.
In the table below you can see the stock price changes for every individual stock of my Vrijheid Fonds in the first quarter of 2018.
| Ahold Delhaize | AH.AS | 4,95% |
| Bayer AG | BAYN | 13,73% |
| Royal Dutch Shell | RDS.AS | 7,20% |
| Unilever | UN.AS | 2,31% |
| AFLAC | AFL | 0,24% |
| Archer-Daniels-Midland | ADM | 8,30% |
| AT&T | T | 8,19% |
| Billiton PLC – ADR | BBL | 1,54% |
| Chevron | CVX | 8,89% |
| Coca Cola | KO | 5,35% |
| Franklin Resources | BEN | 19,94% |
| General Electric | GE | 22,97% |
| Johnson & Johnson | JNJ | 8,21% |
| McDonalds | MCD | 7,75% |
| Microsoft | MSFT | 6,93% |
| Omega Healthcare Investment | OHI | 1,78% |
| Procter & Gamble | PG | 13,74% |
| Realty Income | O | 9,26% |
| South 32 LTD | SOUHY | 8,02% |
| Southern Company | SO | 7,05% |
| Target | TGT | 6,07% |
| Vereit | VER | 6,94% |
| Wal-Mart | WMT | 10,00% |
| NN Euro Obligatie Fonds – Mutual Fund | 0,72% | |
| NN premium Dividend Fonds – Mutual Fund | 7,60% | |
| NN Hoog Dividend Obligatie Fonds – Mutual Fund | 2,85% | |
| Kempen European High Dividend Fund – Mutual Fund | 5,72% | |
| Rabobank Certificates – Corporate Bond | 0,72% |
If I look at this table I can fairly say, that my Vrijheid Fonds, is affected by the volatility of the markets. This explains the negative return I had in the first quarter. The stock market needed a dip because the stocks have become really expensive, which was seen by the high P/E-ratios and the low dividend yields. So now that the prices have dropped, it gives me some nice buying opportunities.
The Dollar
The Dollar lost strength against the Euro in 2017, and in the first quarter, the Euro only got stronger. A little bit more than 2.6% did the Dollar lost against the Euro in Q1-2018.
Because more than 51% of my Vrijheid Fonds consist of US stocks, you can image that the value of my portfolio is affected by a weaker Dollar. But I always look at the bright side of live, my buying power has increased because I can get more Dollars for every Euro 😉 .
And if we take a look at my companies, we see a lot of companies that earn their money outside the US. So a lower value of the Dollar makes it cheaper for them to export their products. And by doing that, hopefully make more profit. But hey, this is just a blog post from a normal European guy, with no professional financial education. So what do I know! I’m not an expert. But I see it is affecting my Vrijheid Fonds, in a positive and negative way.
Finally
2018 started very volatile and of course affected this my Vrijheid Fonds. It is possible that the whole year will be just a volatile. This will certainly give me more buying opportunities.
At this moment I’m passing 3 of my 4 goals. So I’m happy with that and the other goal I have to rethink, because in hindsight I set the bar maybe a little bit too high for this goal at the beginning of this year.
How was your quarter? Did you have a good quarter?
Cheers,
Pollie