Portfolio Summary
Here is a summary of my portfolio at the top level:
- Raiz Aggressive Portfolio – $9,842.91 (-23.4% according to app)
- VDHG (using VPI platfom) – $55,855.8 (-8.89%)
- IVV (Selfwealth) – $562.9 (7.79%)
- SYI (Selfwealth) – $1,904.56 (1.30%)
- VISM (Selfwealth) – $459.90 (-6.17%)
- A200 (Selfwealth) – $1,752.96 (-6.76%)
- Cryptocurrency – $31,256 (-45.95% from principle)
- Australian Shares – 28.69%
- Global Shares – 27.35%
- Bonds – 6.19%
- Fixed Income Assets – 0.3%
- Cryptocurrency – 30.75%
Portfolio Total – $101,635.03. An increase of 4.08% compared to last month’s value ($97,648.66).
This month’s saving rate is 19.37%. Again, this month has shown me that it’s tough to stay on track with my investment plan. I have done my tax for 2021-2022 and had to pay another $2,600 out of my pocket. This is due to a leap in salary, and I have to pay more Medicare Levy surcharge. I also spent my freelance income to buy a new work laptop since I will need it when traveling back to my country to do other work. The saving rate for last month is already low, but this month is another record. With this, I can only invest less this month. Another unexpected event that happens was that I had to lend out my money to a relative. I was in the position to decline but due to family circumstances, I had no other choice but to lend out the money. That’s another $1,200 this month. These 2 are the biggest expenses. With the upcoming holiday trip, I believe my saving rate will not be above 70% any time soon. I still have to book a ticket to go back to Melbourne, and now I start to think I need to save money. I am in the position of wanting to save more money for investing but on the other hand, why can’t I just enjoy the trip normally? I have been procrastinating on the booking for 2 weeks already and still have not made any decision yet. Another change in my expense is that I need to put in another $1,000 for family support, as I have talked to my parents about this. My dad has to go to the hospital more frequently than before, so that’s another cost I need to cover. It’s been a challenging time I would say but as time goes by, let’s see what I learn.
My contribution for this month has dropped. I have to cut off the investment in crypto to $400/week, instead of every 4 days. My contribution to VDHG is still the same at $4,000. Raiz’s contribution is still the same. It’s been a busy month with work and I do not have much time to check my portfolio. This month has been crazy with all the news about inflation, hike rate, and UK bond panic sell. I start to have a feeling that something bad is about to happen but I am still not sure when. Inflation is still out of control and the US dollar has become stronger than ever. Markets have been declining since January and I think this is not a crazy thing to say that we are not even at the bottom yet. I probably think that my wish for a crash is actually going to happen, and now experiencing this, I must say I feel scared and excited at the same time. This is like a test to see if I have the quality to become a long-term investor. Everyone says that just buy and hold, but it’s not that simple at all. It’s not fun when your portfolio keeps dropping and you start to think if you have made a mistake or not. And at this point, sticking to a plan that you already have is the best way to do it. And it helps, at least for me, I have been contributing continuously since January. When the market drops, it’s an opportunity for me to accumulate more and more. Sticking to your plan is the best thing I could say at a time like this.
Note: A reminder is that this number is still an estimation only as my crypto portfolio consists of different assets, including NFTs, staking, DeFi. I have to use different tools to keep track of and maintain the value of assets to finalize the final value of my portfolio. NFT is hard to estimate because of price fluctuation in the crypto market. However, estimation is still good enough in this case.
Events & Porfolio Analysis
Can’t believe people are still expecting the FED to pivot. After this month FED’s meeting, people are now panicking and selling. The US dollar becomes stronger every day. Let’s see what has happened this month that leads to a sharp decline in all the markets.
RBA increases the cash rate target by 50 basis points to 2.35% on 06/09/2022. As I expected, no way the RBA would stop when the FED is still increasing the rate till next year. This will be an interesting time to watch the housing market and how it would react. I have been watching closely the subreddit, well even though it’s not a good source of information, people over there have been bearish about the housing market. However, I still do not understand much about the housing market, even though I don’t understand the index number thing, so maybe it’s a good time to do some research I guess.
07/09/2022, Bitcoin dropped below 19k even though it was going sideways. Stock and Gold also had the same fate. There is various news that might be the reason – the Nord Stream 1 pipeline is shut down, which means we might see an energy crisis in Europe. Many were expecting the Merge, but the update Bellatrix failed on 06/09/2022.
And then, ECB (European Central Bank) raises the interest rate by 75 basis points to 1.25%, and The Bank of Canada also increases the interest rate by 75 basis points to 3.25% on 09/09/2022. Bitcoin also rallies to 21k on the same day, not sure what affects this but probably because the options will expire on that day. Inflation is now hitting like a truck in different countries, especially in the UK and the EU. Eventually, those countries have to take action and increase the interest rate. The main push of inflation is in energy.
Bitcoin hash rate reached a new all-time high at 265Ehash/s on 12/09/2022. The biggest news this month is probably the announcement of CPI in August in the US and it’s higher than the expected number. US Inflation rises to 8.3% in August on 13/09/2022, with this news, all markets got wiped out instantly, Bitcoin dropped to the low of $19,800, the S&P 500 sank 4.3%, while the Dow Jones Industrial Average erased more than 1,275 points or roughly 4%. This is another reason that FED would keep continuing to hike the rate in the future, with more pain to come. DXY rallies to 109 after the CPI news.
The Merge finished on 15/09/2022, and the price was still stable until 16/09/2022, it has dropped to $1,463, so I guess it’s a bit of delay here then. RBA governor Philip Lowe warns of more rate rises ahead, but they may be smaller increases on 16/08, you can believe him, but my concern is high inflation. The US still suffers from it so it’s unlikely Australia will make a small rate hike. Mr. Gary Gensler strikes again by saying that POS assets could be securities, so ETH is security.
With the CPI number announced, the second most important event – the FOMC meeting, the market has expected that FED would likely rate 75 basis points, and there’s also a chance for 100 basis points because of the CPI report. Crypto, stock, and gold are all dipping on 21/09/2022. FED announced another 75 basis points rate hike, the interest rate range is now 3.00% – 3.25% on 22/09/2022. Markets reacted badly to this, and would likely see more suffering in the future. The FED also warns that the rate could be 4.6% in 2023, with no decrease. Another sea of red on 23/09/2022, stock market down, crypto down, gold down, so where’s the money? My best guess is that people are holding cash atm.
To add on top of this mess, on 25/09/2022, New U.K. Prime Minister Liz Truss just announced a plan tax-cut, and the market is not happy with it because it would mean inflation will remain with this plan. The Pound sterling to USD is at 1.0859, which shows that the currency becomes weaker. Another side note is that Optus has been breached, the information of more than 10 million customers have been leaked on 22/09/2022. Bank of England has announced to buy 65 billion pounds of UK bonds to stabilize the market after a historic sell-off on 29/09/2022, pension fund panic. There’s a bit of reading in terms of UK bond work to understand why this happened. You can watch Patric Boyle’s video on the topic – https://www.youtube.com/watch?v=Lf0DenxYqXw.
Another news just came out in Germany on 30/09/2022, the inflation number has just reached two digits – 10.9% compared to August at 8.8%. At the same time, the PCE inflation is higher than expected – 4.9%, more than the 4.7% estimate and up from 4.7% the previous month. Another reason for FED to keep increasing the rate.
It’s been a rough month for the markets. I was expecting my portfolio to drop more but the total portfolio has increased by 4.08%. Most of these gains come from the Crypto portfolio. To be honest, I was surprised by this, but looking back to this month, Bitcoin has relatively held quite well compared to other assets. It still declines but not as much as the stock market. I am still accumulating more Bitcoin at this stage and a third of my stock portfolio is in Bitcoin now. The contribution for this month has been reduced in half but I still think it’s a decent contribution until I stabilize my finance for the next couple of months. I would still buy more Bitcoin at this stage. Other cryptocurrencies are still a high risk so until the market becomes calm then I would start to buy other coins. Another interesting theory is the halving cycle, many people believe that Bitcoin might find its bottom in Q4. (October to December). This comes from the historical data about the cycle, and when applying it to the current cycle, Q4 will be the bottom for Bitcoin. To be fair, other cycles happened in a bull market, and this is the first time Bitcoin has been in a bear market. It would be surprising the role of Bitcoin for a time like this. With the recent news in the UK, there’s a sharp increase in trading volume for Bitcoin as the Pound tumbled. Let’s see how the role of Bitcoin plays out in this market condition.
Raiz’s portfolio has once again dropped below the $10,000 milestone. A sharp decline at 23.4% compared to last month’s 10.24%. The next one on the list is VDHG with a decline of 8.89%. Other ETFs also suffer the same fate. It’s been a lot of sell-offs recently so these declines are expected for my portfolio. I was able to accumulate VDHG at a good price this month, but I bet that would a good price. When checking the price of VDHG over 2-year periods, the lowest was at $45.55 in 2020 (COVID sell-off). We are almost there, I think. The possibility of a recession is increasing every day. We gonna see a major meltdown soon. The only thing that I can do right now is to endure this period. Interestingly, I have just recognized that my portfolio has increased steadily since July (after a major sell-off in June). From July to August, most of the gains came from VDHG and Raiz portfolio, the crypto portfolio went sideway, and for this month, it’s the opposite. Very curious to see what will be the next move for my portfolio next month.
Some of the articles I use for the information above:
- https://www.abc.net.au/news/2022-09-06/reserve-bank-australia-cash-rate-interest-rates-live-blog/101408616
- https://www.theguardian.com/business/2022/sep/02/nord-stream-1-gazprom-announces-indefinite-shutdown-of-pipeline
- https://cointelegraph.com/news/ethereum-s-bellatrix-upgrade-hiccups-jangle-nerves-but-it-ll-be-right-on-the-night
- https://www.ecb.europa.eu/press/pr/date/2022/html/ecb.mp220908~c1b6839378.en.html
- https://www.bankofcanada.ca/2022/09/fad-press-release-2022-09-07/
- https://www.wsj.com/articles/us-inflation-august-2022-consumer-price-index-11663017630
- https://www.abc.net.au/news/2022-09-16/philip-lowe-rba-economic-committee-parliament-testimony/101446974
- https://www.cnbc.com/2022/09/24/liz-truss-britains-lurch-to-reaganomics-gets-thumbs-down-from-markets.html?&qsearchterm=britain
- https://7news.com.au/technology/optus/optus-data-breach-to-lead-to-cybersecurity-reform-as-10-million-australians-information-is-held-ransom-c-8356783
- https://www.cnbc.com/2022/09/29/pension-fund-panic-led-to-bank-of-englands-emergency-intervention.html
Passive Income
This month has produced about 13.6332 ADA. SOL and ONT rewards are small. BAT reward is 27.5 BAT. Staking reward for AXS for this month is about 0.34 AXS. Staking for IMPACT is 3255.516295. Dividend from all source is $649.37, all re-invested.
To sum up:
- ADA Reward – 13.6332 ADA.
- SOL and ONT rewards – the reward is not large enough to consider.
- Brave Reward – 27.5 BAT.
- AXS Staking – 0.34 AXS.
- Impact Staking – 3255.516295 PACT
- Dividend – $649.37
What I have learnt
Keyword for this month – Focus
This month is quite an interesting month. I have learned quite a lot, of my technical skill and soft skill as well. My communication has improved even more since last month. With the confidence that I have gained last month, I am more comfortable talking to colleagues in different teams or groups. One of the key events is when I receive an issue from one of my colleagues, and I need to find a way to fix it immediately since the code will be released to production on the weekend. I managed to contact and talk with one of the senior experts, communicate the problem, and found a solution. However, I also had to tell the members about the issue, set up a meeting, and quickly gathered a plan to fix this. Everything went smoothly and we found a solution. I still can’t believe that I managed to fix that in just a day. It’s a huge improvement to my skill I would say. Not only that, but with the senior lead behind me, I am now asking more technical questions to gather more knowledge. I am aiming to become like him one day soon but that road will not be easy. All it takes is my patience and the will to learn, simple as that. There’s one more thing worth mentioning – I need to learn to take care of myself better. The reason I bring this up is that for the second half of the month, there’s been more work than I could imagine. My brain at that time felt heavy, and I woke up at night more frequently. I usually take this kind of sign of stress and burnout. I was thinking that I should not push myself much but eventually, I still end up doing more work. There’s been a lot of work in my daytime job lately, and even after work, I still receive emails from the company that I do freelance work. Unfortunately, the manager at the company is on leave now so most of the emails come from the business team. And those emails just keep coming daily. At the time of writing this line, at 9:33 PM, I am still trying to finish the content for my blog. I need to relax.
There’s one more thing I want to raise is that sometimes it’s good to check other people’s work instead of assuming they have done the work correctly. An incident at work related to one of the feature has caused a major issue for my team. This is not our fault but still, if I had been careful and checked the work before accepting it, this could have been avoided.
I also don’t have much time this month to listen to podcasts or study investing. Now thinking about what have happened this month, I really to have a bit of time for myself and relax. Life is not all about work, as a friend has told me. Let’s see if I can manage to change a bit in October. Another year is about to end, and new challenges are waiting for me.