My Stocks and Index funds investment December 2018
This is my ninth update on my stocks and index funds investment. I update about the progress every month. It’s in total 10% of my investment portfolio at the moment.
I have created an automatic money transfer from my bank because it will save me the brokerage fees (they made a deal). My investment is very small but it’s ongoing every month since June 2018.
Sparindex INDEX OMX C25 KL
It has an annual cost of 0.5%. Investments are made exclusively in Danish shares, which are included in the OMX C25 Index, where no share may amount more than 20%. I get paid dividends.
- March: Started tracking
- April: -1,02%
- May: -0,26%
- June: +2,04%
- July: -3,21%
- August: +5,64%
- September: -1,86%
- October: -5,84%
- November: -1,85%
- December: -0,38%
Return on investment in 2018: -10,54%
The expected return on investment in 2018: -10%
Sparindex Globale Akt Min Risk KL
It has an annual cost of 0.5%. Investments are made to follow the MSCI World Index. I get paid dividends (approx 3-4% annually).
- September: Started investing
- October: +0,25%
- November: -1,28%
- December: +0,59%
Return on investment in 2018: –0,44%
The expected return on investment in 2018: +0,00%
Right now, I only invest in a single Danish stock called “Vestas Wind Systems A/S”.
This stock is 2% of my investment portfolio. I don’t plan to sell it for many years but I also have no plans to buy more. I get paid an annual dividend.
- March: Started tracking
- April: -2,19%
- May: -5,07%
- June: +4,04%
- July: -6,47%
- September: +4,47%
- October: -5,24%
- November: +4,47%
- December: +12,54%
Return on investment in 2018: -14,03%
Expected return on investment in 2018: -15,00%
Comments on the progress
It hasn’t been the best year to invest in the stock market.
In 2018, I’ve only lost money like everyone else, but it will change in time.
Fortunately, it’s a smaller proportion of my total investment portfolio (10% in total).
I have no plans to sell for many years. I actually intend to invest more in index funds in the coming years.
Here is a great overview of the ETF’s in countries:
My investment strategy
I started investing in the stock market back in August 2017.
I invested in 3 stocks to get started. Later on, I sold 2 with a good return of around 25% and kept the last stock. Over time I learned more about the stocks and index funds.
I chose to move away from individual stocks and invest in index funds instead.
This will lower the risk and it’s time-consuming and difficult to select individual stocks.
I have found out that the best for me is to invest in some cheap index funds that try to follow the index. In this way, my investment basically follows the development of the stock market instead of individual stocks.
My criteria for selecting index funds
- The annual total cost must be under 1% (cost eats into returns)
- The index has strong global companies included (like S&P 500)
- The last 5 years gave at least 10% in return (fairly high-risk tolerance)
- No share may amount more than 20%
- They paid out annual dividends
Invest in index funds
It has become incredibly popular to invest in index funds. Many have experienced some very positive returns on investment with less risk (than picking stocks) and less time involved.
It’s very easy to way to grow your wealth but I would not have more than 35% of my money in this asset allocation.
It’s an excellent low-cost investment strategy but you need to understand the criteria of the index fund before investing.
There is a wide range of index funds that track and invest in different indexes like S&P 500 (USA) or OMX C25 (DK). They are not the same because they include different kinds of assets and have different criteria.
You can find index funds that invest in specific stocks, bonds, small companies, foreign stocks, globally or locally. Most of them have very low fees and better returns compared with most mutual funds.
It’s not about beat the stock market but rather to be the market.
Most people that are investing in index funds have a long-term focus and that’s very good because it gives fewer outflows and a more stable growth.
When you want to be financially independent then it’s an ideal investment opportunity in my opinion.
💡 I hope you liked my update this month about my stocks and index funds. You are welcome to leave a comment below 🙂
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