The portfolio is up 0.37% year-to-date

How often do you look at your portfolio? Once a year? Once a month? Once an hour?

If you check your portfolio like you check your email then you’re probably going to drive yourself up the wall and do something you regret – like a teenage conscript nervously fingering his Kalashnikov, you’re primed for action and desperate to relieve the tension.

All this waiting! Let’s do something! Buy something. Sell something. I gotta make a difference!

Well, I haven’t looked at our demo portfolio in the three months since our last Slow and Steady portfolio updateI’m only looking now because I have to write this post. Ideally I’d only take a peek once every six months on preordained dates.

In between times:

  • No fretting.
  • No impulsive acts.
  • No buying yesterday’s winners that turn into tomorrow’s chumps.
  • No reacting to the market trader cries of pundits and salesmen.

Ignorance is bliss.

Up, up, and away (a bit)

So did we miss anything while I was asleep?

Not a lot.

The portfolio made £107 last quarter, which finally pushes our gains through the £2,000 barrier after three years. We’re up over 16% on purchase.

The Slow and Steady portfolio is Monevator’s model passive investing portfolio. It was set up at the start of 2011 with £3,000 and an extra £850 is invested every quarter into a diversified set of index funds, heavily tilted towards equities. You can read the origin story and catch up on all the previous passive portfolio posts here.

Here’s the portfolio lowdown in spreadsheet-o-vision:

We're up 16.9% overall.

Japan dropped 5% over the last three months while the US and UK were at a virtual stand still. Europe ticked up 3%. We’ve made precisely £1.08 on our Pacific Rim fund and we’re still up nearly 4% on UK gilts despite the warnings of Bondageddon.

The only asset where we’re still down on the money that we’ve invested to-date is emerging markets (Russian equities look very cheap!).

This all contrasts very notably with the popular mood when we started our portfolio. Back then – just 36 months ago – emerging markets were all the rage, while Europe was about as popular as sensible haircuts in Shoreditch.

Trends will come and go but our portfolio is designed to suit all seasons. Our hardest task is to stick with it.

Dividends

Our Vanguard UK Equity index fund paid out £65.68 in dividends. Ker-ching! All our dividends are automatically reinvested into more shares – compounding our wealth at an increasing rate. This is accomplished by investing in the accumulation versions of our funds.

New transactions

Every quarter we place an £850 down payment on our future happiness. Our cash is divided between our seven funds according to our soberly planned asset allocation.

We use Larry Swedroe’s 5/25 rule to trigger rebalancing moves. All’s quiet for now though, so on with this quarter’s purchases.

UK equity

Vanguard FTSE U.K. Equity Index Fund – OCF 0.15%
Fund identifier: GB00B59G4893

New purchase: £127.50
Buy 0.66 units @ 19318.5p

Target allocation: 15%

Developed World ex UK equities

Split between four funds covering North America, Europe, the developed Pacific and Japan1.

Target allocation (across the following four funds): 49%

North American equities

BlackRock US Equity Tracker Fund D – OCF 0.18%
Fund identifier: GB00B5VRGY09

New purchase: £212.50
Buy 160.5 units @ 132.4p

Target allocation: 25%

European equities excluding UK

BlackRock Continental European Equity Tracker Fund D – OCF 0.17%
Fund identifier: GB00B83MH186

New purchase: £102
Buy 60.391 units @ 168.9p

Target allocation: 12%

Japanese equities

BlackRock Japan Equity Tracker Fund D – OCF 0.17%
Fund identifier: GB00B6QQ9X96

New purchase: £51
Buy 41.096 units @ 124p

Target allocation: 6%

Pacific equities excluding Japan

BlackRock Pacific ex Japan Equity Tracker Fund D – OCF 0.2%
Fund identifier: GB00B849FB47

New purchase: £51
Buy 24.673 units @ 206.7p

Target allocation: 6%

Emerging market equities

BlackRock Emerging Markets Equity Tracker Fund D – OCF 0.28%
Fund identifier: GB00B84DY642

New purchase: £85
Buy 82.285 units @ 103.3p

Target allocation: 10%

UK Gilts

Vanguard UK Government Bond Index – OCF 0.15%
Fund identifier: IE00B1S75374

New purchase: £221
Buy 1.718 units @ 12864.9p

Target allocation: 26%

New investment = £850

Trading cost = £0

Platform fee = 0.25% per annum

Average portfolio OCF = 0.17%

If all this seems too much like hard work then you can always buy a diversified portfolio using an all-in-one fund like Vanguard’s LifeStrategy offering.

Take it steady,

The Accumulator

  1. You can simplify the portfolio by choosing the do-it-all Vanguard FTSE Developed World Ex-UK Equity index fund instead of the four separates.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>


*