My Passive Investments - July 2019 (+5.74%)

A short term look on long term investing

Disclaimer

In July, I did a few new things with the blog. I’ve added a Portfolio section where you can track my saving and investment allocations (updated monthly).

I also decided to open an online store, where I donate 10% of all profits to charity. I sell the very spreadsheets I use on a regular basis. Spreadsheets for tracking Savings & Investments, Credit Cards and Loyalty Points and Matched Betting (as well as a discounted bundle).

In terms of my investments, here is what happened in July, 2019.

First, remember, my investment decisions are exactly that, my own. As as UK-based investor, I based each investment decision on my own research. These are, by no means, investment recommendations.

Before making any investment decision, you must do your own research and/or speak to a professional.

Firstly, A Reminder Why I Do These Reports In The First Place

You can read more about this in my first passive investor report, which I made all the way back in June 2018.

My Passive Investment Strategy

Long term, my aim is to invest a portion of my savings every month. An important note here is that the numbers you will see in this report reflect the gains and losses of my invested capital only. When I invest more, for example, I would not state this as a gain in the value of my portfolio.

Similarly, if I sell a portion of my investments, this would not be stated as a loss in the value of my portfolio. The numbers simply reflect the performance of the underlying investments. Simply put, a loss/gain does not take into account buying/selling assets. 

Vanguard Stocks and Shares ISA

All investments are held in a stocks and shares ISA with Vanguard. You can contribute anything up to the limit of £20,000 in the 2019/20 tax year. When it comes to investment income/selling any portion of my investments, thanks to the ISA wrapper, any income/capital gain is tax free. 

July Returns (+5.74%)

In the past month, returns were again positive at +5.74%.

This beats my monthly gain record of +4.64%, which was set back in January of this year.

I invest 25% of my monthly savings (post-expenditure). The other 75% goes towards my first home fund. Towards the end of this tax year, I will shift as much as I can into a Lifetime ISA (for the 25% government bonus). The current annual Lifetime ISA contribution limit is £4000.

100% of my investments are in the Vanguard FTSE Global All Cap Index Fund (Accumulation). Vanguard’s annual account fee is an extremely competitive 0.15% on anything up to £250,000 (no account fees thereafter). The annual fund fee currently stands at 0.24%. This means my total annual investment fees are only 0.39%.

 
Capital Matters - July Passive Investments - Monthly Return
 

Returns Since Inception (+16.37%)

The inception date is the date I first started investing through Vanguard, the end of May 2018. Since then, my portfolio has grown by +16.37%.

 
July Passive Investments - Returns Since Inception of +16.37%
 

Annual Return (+13.66%)

From July 2018 to July 2019, my investments returned +13.66%.

Since the index fund I’m invested in is accumulating, all company dividends are reinvested. This turbocharges compound interest. On checking the ‘income’ version of the fund on Vanguard’s website, I can see that the annual dividend yield (at close 30th of June 2019) was 1.74%.

 
Capital Matters - July Passive Investments - Annual Return since 2018 of +13.66%
 

Sector Breakdown

You can see the sector breakdown of my investments below. All of these sectors, and others, are represented (as per the percentage below) in my one-fund portfolio.

Capital Matters - July Passive Investments - Sector Portfolio Breakdown

Here are the changes from last month:

Technology (+0.1%), Health Care (+0.1%) and Basic Materials (+0.2%) now make up slightly more of my investment portfolio.

Financials (-0.2%), Consumer Goods (-0.1%) and Utilities (-0.1%) make up slightly less.

Industrials, Consumer Services, Oil & Gas and Other Sectors stayed at the same allocation as last month.

Some Useful Sector/Industry Definitions:

Technology: A broad industry referring to the delivery of energy transportation.

IT: The Information Technology sector focuses on the delivery of information (ie. smart phones)

Consumer Goods: Products bought by an average consumer (eg. food)

Consumer Services: A range of service products offered to customers who buy a product from a company (eg. technical support, account management)

Consumer Discretionary: Products that are not essential but desirable (ie. luxury items, leisure etc.)

Geography

You can see the breakdown of my index fund investment by geographical area below.

Capital Matters - July Passive Investments - Geographic Allocation

Europe (+0.3%), Asia/Pacific (+0.3%) and the Middle East/Africa (+0.1%) now make a slightly larger portion of my investments.

North America (-0.4%), Japan (-0.2%) and Central/South America (-0.1%) make up slightly less.

The UK and Eastern Europe remain at the same allocation as last month.

Individual Investments

Here’s a breakdown of the top companies in my index fund portfolio.

These are not individual stocks that I own, simply the 10 largest stocks in the global index fund that I own. It’s always worth bearing in mind how concentrated your investments are.

 
Capital Matters - July Passive Investments - Top Companies
 

There have been no changes, in name, to the top 10 this month. But there have been changes in place and allocation.

Microsoft remains at the number one spot (+0.1% since last month), followed by Apple (+0.1%) and Amazon (+0.1%).

Alphabet (-0.1%) remains at number 4, followed by Facebook (+0.1%). Berkshire Hathaway (CEO: Warren Buffett) is back in at number 6 (+0.1%).

JPM Chase remains at 0.7% of my portfolio and drops in place to number 7. J&J remain at 0.7% and also drops in place to number 8.

Nestle and Exxon Mobile don’t change in place or percentage, both making up 0.6% of my portfolio.

The top 10 companies now account for 10.6% of my investments overall. This is an increase from last month of +0.4%, meaning my investments are slightly more concentrated in the top 10.

Dividends

Since I invest in the ‘Accumulating’ version of the FTSE Global All Cap Index Fund, all dividends are automatically reinvested back into the fund.

Goals For August

  1. Don’t stop investing. Invest 25% of my savings (post-expenditure). 75% to the home fund.

  2. As always, focus on increasing income. The most powerful way to boost savings.

That’s all folks! I hope you enjoyed reading my July report. If you enjoyed the read, don’t forget to like and share on social media.

If you’re looking for resources to better your own personal finances, here are some of my recommendations:

Savings/Investment Spreadsheet Downloadable - 10% of profits go to a charitable cause.

Facebook - UK Passive Investing Group - Join A Like-Minded Community

Check out my offers page to earn some free money and grab some freebies.

Rich Dad, Poor Dad by Robert Kiyosaki

The Little Book of Common Sense Investing by John C Bogle

The Intelligent Investor by Benjamin Graham