2020-03 Portfolio Update

“Don’t tell me what you think, tell me what you have in your portfolio.”

― Nassim Nicholas Taleb, Skin in the Game: Hidden Asymmetries in Daily Life

CCPC (Corporate) Portfolio

ETF/ Stock

Shares Added

BRK.B

0

VGRO

49,750

GIC

Maturity x 1

  • Brk.B: Berkshire Hathaway Class B
  • VGRO: Vanguard Growth ETF Portfolio (80/20)
  • ZDB: BMO Discount Bond Index ETF
  • GIC: Guaranteed Investment Certificate

CCPC Plan

  • Keep Berkshire as a legacy stock until we fully enter part time work or retire.
  • Sold ZDB late March because bonds are behaving badly. I did not particularly enjoy losing 20K capital in a week.
  • XAW & XIC:
    • Plan to tax loss sell when possible.
    • Canadian Couch Potato Portfolio
    • Sold both mid March 2020

Non- Registered (Taxable) Portfolio

ETF

Shares Added

VDY

591

  • VDY: Vanguard Canadian High Dividend Yield Index ETF

Non- Reg Plan

  • Buy VDY to allow some tax efficient income with eligible dividends from Canadian companies.
  • I mainly have this because my husband wants it.
  • I bought more VDY too early as usual. Oh well I hope the dividend income will work.
  • This month highlights how dividend investing is NOT fixed income. Canadian dividend investors might not want to look at their portfolios.
  • High interest savings accounts have slashed their rates. My GIC’s are not looking so bad after all.

RRSP (Tax Deferred) Portfolio

ETF

Shares Added

VAB

0

GIC

Maturity x 0

  • VAB: Vanguard Canadian Aggregate Bond Index ETF

RRSP Plan

  • Whenever a GIC matures, I buy VAB. I have too many GICs.
  • VAB is on a dividend reinvestment plan. So easy peasy.
  • Use this account to hold bonds. This is as complicated as my asset location strategy gets.

TFSA (Tax Free) Portfolio

ETF

Shares Added

VGRO

0

  • VGRO: Vanguard Growth ETF Portfolio (80/20)
  • This is the easiest account. I fill this up every January and set this on a DRIP.

My Whole Portfolio

I treat all the accounts as one portfolio.

Here is the portfolio broken down by account into overall percentages. I find it more useful to get an overall view of it.

This is just the way I am doing it. I have different goals, traits and triggers than others.

Taking anyone else’s plan off the internet must be one of the silliest things one can do to their financial health.

Everyone has to do the heavy lifting required to regularly define exactly what you want your portfolio to do for you. Thinking and making decisions is hard. I get that.

Account

Ticker

Asset

Portfolio %

Corporate

BRK.B

Berkshire Hathaway

4.6

Corporate

VGRO

80/20 Asset Allocation ETF

42.6

RRSP1

VAB

Aggregate Bond

1.8

RRSP1

VGRO

80/20 Asset Allocation ETF

1.5

RRSP2

VAB

Aggregate Bond

4.0

TFSA1

VGRO

80/20 Asset Allocation ETF

1.3

TFSA2

VGRO

80/20 Asset Allocation ETF

1.3

Taxable

VDY

Canadian High Dividend

0.8

GIC/ Cash

42.1

Total

100%

Networth (YTD -2.4%)

Investable Assets

66%

Personal Residence

27%

Other

7%

Investable Assets – 65% of Networth

  1. Real Estate (unleveraged) – 9%
    1. Commercial unit
  2. Paper Investments – 90%
    1. Equities – 42.6%
    2. Fixed Income – 57%

Well I have once again proven to myself that I am a terrible market timer. Thank goodness I am a long way off before I ever need this portfolio. In a way it is better that my husband and I see how this strategy will work in real time. If we never put enough into the market, we would not know how we will truly handle it.

I have invested in individual companies and have watched my investments crater in the dot com crash. I recently sold Amgen which I had held for 20 years. I sold because I have no desire to watch individual stocks. I did not even watch it when I held it.

I am sure I bought too early in this downturn. However I still have a lot of cash. Not even bonds, just cash. And now the banks will not pay anything for cash in the bank. Now that cratered bond ETF does not look nearly so terrible after all.

Our networth has gone down. Whenever I buy VGRO it keeps cratering. I will be relieved to get enough of the ETF and then start a quarterly investment process. I will be relieved when this throwing in part is done.

It might whip around a lot but I do not have to do anything once it is in. I was even happier to get rid of my XAW ETF which was part of my original couch potato portfolio. I still would rather declutter when possible.

I plan to spend the portfolio dividends when we need to for wants. I think our government benefits and RMDs from the RRSP will likely be enough to live on anyways.

I don’t think most folks should look at their portfolios during times like this. I am grateful that there are products such as these asset allocation funds. I do NOT want to deal with this stuff forever.

I am only trying to buy in at a better price than originally lump sum investing during 2018 and 2019. I am glad that I held off. We never rode the market up so I will attempt to get some slightly on sale for my husband.

This month ain’t over yet.

I just want to get this done. Thankfully I had zero illusions that I would do this well. I told you I rarely get anything on a deal. Good enough is about all I ever achieve.

Besides, staying healthy is much more important than one’s portfolio.

Notes

Mar 13, 2020 – The trading week is over. I was able to sell XIC in the final half hour and get to the simplified portfolio that I want. I have no control over the market but I can still declutter.

Mar 22, 2020 – Have been busier with working than worrying about my portfolio. I have been setting limit orders early in the day and following up at night to see if they fill. Otherwise more pressing things to deal with. The bigger deal is figuring out cash flow. I have cash but I would prefer to use this for investing than managing overhead expenses. Times like this I am grateful that we run a tight ship. And plenty of intelligent folks warn that this will end very badly for investments. Oh well. I do not have anything else up my sleeve. If this form of investing does not work, then it kind of makes things easier. Since what is the point of worrying about any of this anymore. I would just earn enough to live on each year enjoyably and call it a day. Whatever. I don’t particularly have attachment to however this works out financially.

Mar 31, 2020 – Sold ZDB mainly to simplify my accounts. I now have all the ETFs with Vanguard. Easier to track dividend payment dates. Furthermore bonds are behaving oddly. I saw how ZDB reacted to the panic selling period. I do not want to be caught in that rout again. I want to keep my ZDB capital as dry powder if the opportunity arises.

Avoiding COVID from working is more important than the portfolio. All the more reason to keep this thing simple.

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