Could 2024 FIRE Portfolio Replace: Resumption of All Time Highs

Could 2024 was a continuation of the bull pattern that began in November 2023. Whereas we bought a slight dip in April 2024, it was very brief lived and those who purchased the dip noticed the markets return to all time highs. I believed Could would possibly carry in additional alternatives to purchase however that basically by no means materialized. Inflation trended down barely giving the markets the boldness they wanted to rally once more. Nasdaq, which has led the complete marketplace for the previous few years, rallied to new all time highs because of Nvidia proudly owning all people. Nvidia would be the largest firm quickly sufficient as it is just $0.5bn away from Microsoft.

Should you haven’t already learn my posts earlier than, I achieved Monetary independence again in late 2020 early 2021 with a portfolio of roughly $1.3m invested in primarily ETFs. This ballooned to $1.7m in the course of the peak of the markets in early 2022 earlier than coming again right down to Earth later in 2022.

This submit will likely be a part of a month-to-month sequence of portfolio updates that summarizes how my portfolio carried out, what trades I executed, what my month-to-month bills have been, and my normal outlook on the economic system/markets. That is by no means monetary recommendation so don’t look have a look at me for sage recommendation. I make silly trades and make even worse losses fairly continuously.

That is merely the efficiency of my portfolio and the way it has carried out on a month to month foundation.

Month-to-month Highlights – Could 2024

• Internet value is close to $1.86m as of Could 2024 Month finish
• +$90k for the month
• Traveled all all through Indonesia together with one other go to to certainly one of my favourite islands in Lombok, diving with whale sharks in Sumbawa, and at last a brief stint again diving in Komodo as a result of that’s simply one of the best place!

Market Strikes

What’s in my portfolio?

My portfolio is kind of easy and straight ahead. I’ve my holdings primarily unfold out between a number of ETFs, fastened revenue, and numerous single identify shares.

Mounted Revenue

Attributable to rising charges, I’ve additionally allotted a small a part of my portfolio (<5%) to fastened revenue merchandise. I’ve been buying 5.5% yielding treasury payments with a 3-6 month expiry. I at the moment have about ~$60k invested in a 3-mo T-Invoice that can expire in June 2024.

I’ll most likely roll this contract and purchase one other 3mo t-bill when it expires in June 2024 because the 5.5% yield is tough to move up.

That is assured cash with zero threat which I made a decision to reap the benefits of whereas ready for higher entry factors. Nonetheless, it looks like this cash most likely would have been higher used simply shopping for the market however that is alternative value I’m prepared to sacrifice.

I additionally bought I-Bonds in 2022 on the peak of inflation peak when I-Bonds have been paying 9.5%. The charges have come down considerably since then as inflation itself has come down. The optimum time for me to promote these bonds have been on Dec 1, 2023 as that will have been the final month I used to be eligible for the upper price of 6.4% (nonetheless greater than what treasuries paid). As you need to forfeit three months of curiosity upon withdrawal earlier than 5 years, in complete my blended price of return was round 8% for 15 months which is unquestionably one thing I can stay with.

ETFs

Once more, my main holdings are in a number of ETFs. My main holdings are in VTI, VGT, and VCR. I’ve all the time been a giant proponent of massive tech and have been closely invested within the Nasdaq for over a decade. This has paid off very properly for me given the large bull market of the 2010s and is basically what allowed me to FIRE so shortly.

I used to carry extra dividend producing shares as I used to be actually into the sort of investing at a time period. I at the moment would not have many dividend particular ETFs as I favor development greater than revenue. This type of goes towards the ethos of economic independence however I manage to pay for coming in from different sources that I don’t have to focus a lot on revenue.

I added to my ETF positions in Could 2024 when the Nasdaq dipped in early Could. I like so as to add positions on dips and the pullback was sufficient of 1 for me to start out including to my place.

Single identify shares

A number of the single identify shares I personal are the next

• TSLA
• BRK.B
• NFLX
• RITM
• ASML
• ANET
• ARES

These single identify shares make up lower than 10% of my complete portfolio. I are likely to not purchase a lot single identify shares anymore as there’s no level to tackle pointless dangers once I’m already so diversified with my ETFs.

Actual Property

I at the moment personal no actual property. I used to personal property within the US however have bought it in 2022 earlier than charges began rising. I’m not a giant fan of actual property. Whereas it positively generally is a good funding, I don’t suppose it beats investing within the markets. As well as, actual property is very illiquid with excessive transaction prices that few individuals contemplate.

Lastly, as somebody that travels world wide and doesn’t wish to be tied down to at least one location, actual property doesn’t make sense as managing it from afar creates a bunch of complications. I a lot favor to have my cash liquid and within the inventory market.

Could 2024 noticed a resumption of the bull market that’s been the inform of the story for a half 12 months now. April noticed the one dip on this bull market however it was promptly purchased again up as inflation numbers got here in on the softer aspect. Markets rallied to new all time highs in the course of the month earlier than promoting off barely into the month finish.

As you possibly can see from the beneath screenshot which I all the time monitor utilizing the CME Fed Fund Futures web site, the anticipated price in Dec 2024 is at 5.25% (simply 0.25% beneath the place we’re at present) which implies only one price lower. I may see this altering to no price cuts very quickly if inflation nonetheless stays sticky. This didn’t change a lot all through the month because the numbers from April month finish have been roughly the identical.

In Could, markets rallied 6-7% on the Nasdaq and about 4% on the S&P 500. Earnings have largely been robust even and Could noticed NVDA completely crush earnings which allowed markets to rally much more. NVDA will quickly grow to be the most important firm on the earth as it is just about $0.5T away from Microsoft. Loopy to suppose that this firm used to lower than $1T only a 12 months in the past.

Market Worth of Portfolio

Here’s a historical past of my portfolio worth. As you possibly can see, it’s moved in step with the markets as needs to be the case since most of my holdings are in ETFs that monitor the S&P 500 and the Nasdaq.

In complete, my portfolio is sitting someplace round $1.86m which additionally contains money and glued revenue positions. This most likely be over $1.9m if it weren’t for my coated name MTM losses.

Trades executed for the month of Could 2024

Could was a quiet month for my buying and selling regime. I purchased extra VGT on the again of dips however there actually weren’t that significant of suggestions available. I additionally purchased in to ARES which is a non-public fairness firm that has been very constant over a few years.

Abstract of inventory and ETF purchases

Portfolio withdrawals and bills

Withdrawals from my portfolio is a vital a part of the monetary independence ethos. The 4% withdrawal price rule is without doubt one of the most important ideas of the FIRE motion which I attempt to adhere to. Typically, I favor to promote from my portfolio when markets are close to or in any respect time highs to seize, and solely once I really need the money.

For the month of Could 2024, I traveled to Seoul, Korea which marked nation #94 for me. I additionally spent a while in Japan which was superb given how a lot the Yen has depreciated. It actually felt low cost particularly in comparison with my final go to again in 2015 when the USDJPY was round 110.

I made no withdrawals from the portfolio as I had sufficient money coming in from my weblog in addition to leftover money from different sources. My weblog generates cash each month to the tune of $3-4k and I cowl precisely how I earn cash from running a blog in different posts.

Dividend Revenue

For Could, I collected a complete of $250 in dividends. I usually reinvest my dividends which has served me properly in the course of the market downturn of the final 12 months or two. I believe I’ll most likely cease reinvesting dividends within the close to time period as I wish to maintain a money pile whereas shares are in any respect time highs to reinvest when markets finally dip.