Low Economic Growth

Read more about the article Portfolio Update – June 2020 – We’re In The Clear: Shift To Stocks! But Not Really…

Portfolio Update – June 2020 – We’re In The Clear: Shift To Stocks! But Not Really…

  • Summary of June 2020 in the economy - Stock market is still uncertain
  • Monthly portfolio update: Fairly stable month: long-term bonds down, stocks, gold and commodities up
  • Book tip: Balanced Asset Allocation: How to Profit in Any Economic Climate by Alex Shahidi (link at the bottom of the post)
  • In case you missed it: Deep Dive post about how to hedge against inflation on my Patreon page was published earlier in June

I am so glad that you have found your way to my June portfolio update of the All Seasons Portfolio blog. It is a rainy afternoon here in Stockholm that I am writing this in early July. Still keeping social distancing and working from home quite a lot. Hoping to see a change soon, for the benefit of all fellow Europeans. We really need to get the economy going again, as I am sure you agree. Hope you have been able to keep your job though.

This month, I have come to the conclusion that the time for stocks is now, at least if you look at what is going on in the markets. Not sure if I am convinced this is the way we are heading, so I prefer to diversify my portfolio properly.

The stock market have bounced back from the steepest downturn in memory, and what looks like the shortest recession in history if you only look at the stock market development. The stock market is almost back at similar levels to where they were before all hell broke loose in February, regardless but S&P 500 saw almost flat development over June with +1.8%. Mostly, the climb in stocks were driven by tech and "stay at home" companies, as Nasdaq composite rose 6% over the month.

On top of that, central banks and governments over the world are launching new stimulus packages by the week, as we covered in last month's update. The two acronyms TINA and FOMO are the main forces driving the markets upwards. As a reminder, these stand for "There Is No Alternative" and "Fear Of Missing Out", meaning that investors see that there is no alternative to stocks to achieve return, and investors are afraid to be left at the station if they do not jump on the train as soon as possible. Both of these are driving great amount of money into the stock market, increasing demand.

Continue ReadingPortfolio Update – June 2020 – We’re In The Clear: Shift To Stocks! But Not Really…
Read more about the article Portfolio Update – May 2020 – What happens now? Uncertainty after Covid-19

Portfolio Update – May 2020 – What happens now? Uncertainty after Covid-19

  • Summary of April 2020 in the economy
  • The most important lessons from the coronavirus crisis to remember and to prepare for future crises
  • My All Seasons Portfolio is up 3.93% month by month. Total value now over EUR 4,000
  • Bought Stocks and Commodities this month, and switched Long-Term Government Bonds ETF to US Treasuries instead of global bonds

Welcome back for another monthly update of the All Seasons Portfolio blog. This time around, we have had to digest another month in lock down and April 2020 could perhaps be remembered for us all wanting to forget it.

Anyway, I hope that both you and your families and loved ones have stayed in good health, and that you haven't been too restless at home.

On my end, things have been hectic at work with long days, which is not surprising when you work with loans to corporates. These are interesting times but I am holding up. Hope we will soon be seeing an end of the tunnel. However, I am very pleased and humbled to still have job, as I know not everyone have been that lucky. And at least in Sweden, we have been able to exercise outside, but if our government have employed the right strategy through the outbreak, I am not the right person to take a stance on. All I know is that I have been working from home the past 8 weeks and been avoiding to go to the bars (which cannot be said for all my countrymen). Just hoping that we all will soon be able to get these crazy times behind us.

These are crazy times in our daily lives and for the economy, it has not been uneventful on the financial markets either. It feels quite difficult to summarize everything that goes on when so much happens. It also feels like there is so much going on that you lose the sense of time, like did the WTI crude oil flash crash happen 3 weeks ago or 3 months ago? It seems s hard to keep track of time when stuck at home.

Continue ReadingPortfolio Update – May 2020 – What happens now? Uncertainty after Covid-19
Read more about the article Portfolio Update – April 2020 – Covid-19 – Time to reflect and prepare for next crisis

Portfolio Update – April 2020 – Covid-19 – Time to reflect and prepare for next crisis

  • Summary of April 2020 in the economy
  • The most important lessons from the coronavirus crisis to remember and to prepare for future crises
  • My All Seasons Portfolio is up 3.93% month by month. Total value now over EUR 4,000
  • Bought Stocks and Commodities this month, and switched Long-Term Government Bonds ETF to US Treasuries instead of global bonds

Welcome back for another monthly update of the All Seasons Portfolio blog. This time around, we have had to digest another month in lock down and April 2020 could perhaps be remembered for us all wanting to forget it.

Anyway, I hope that both you and your families and loved ones have stayed in good health, and that you haven't been too restless at home.

On my end, things have been hectic at work with long days, which is not surprising when you work with loans to corporates. These are interesting times but I am holding up. Hope we will soon be seeing an end of the tunnel. However, I am very pleased and humbled to still have job, as I know not everyone have been that lucky. And at least in Sweden, we have been able to exercise outside, but if our government have employed the right strategy through the outbreak, I am not the right person to take a stance on. All I know is that I have been working from home the past 8 weeks and been avoiding to go to the bars (which cannot be said for all my countrymen). Just hoping that we all will soon be able to get these crazy times behind us.

These are crazy times in our daily lives and for the economy, it has not been uneventful on the financial markets either. It feels quite difficult to summarize everything that goes on when so much happens. It also feels like there is so much going on that you lose the sense of time, like did the WTI crude oil flash crash happen 3 weeks ago or 3 months ago? It seems s hard to keep track of time when stuck at home.

Continue ReadingPortfolio Update – April 2020 – Covid-19 – Time to reflect and prepare for next crisis
Read more about the article Portfolio Update – March 2020 – Have you been taking too much risk?

Portfolio Update – March 2020 – Have you been taking too much risk?

  • Reading tips on how the All Seasons Portfolio Strategy has developed during the coronavirus bear market
  • Have you been taking too much risk as an investor?
  • The monthly portfolio update - Stocks still down, gold is up again
  • A lesson learned from a mistake I made on choosing my Long Term Government Bond ETF.

Hi, and happy to have you back for another monthly update!

Here in Sweden, as you may have heard, our government are taking a different approach than the rest of Europe. I don't condone how they are treating it, but I have been working from home for more than 3 weeks now (and counting), doing my part in not spreading the virus further. We are all in this together and everyone has a responsibility to limit the spreading.

And now down to business. Another month has passed with heavy impact of the Covid-19 coronavirus on the financial markets. There is so much that could be written on the coronavirus outbreak and its effects on the economy, and honestly, it is way more than can reasonably be covered in this blog post.

I will, however, share how it has impacted my portfolio so far, some personal observations, and also reflect on risk taking, as I believe many retail investors have been in over their heads on the stock market in recent years and only now get a glimpse of what risk means. And of course, I will share the usual monthly portfolio update.

Continue ReadingPortfolio Update – March 2020 – Have you been taking too much risk?
Read more about the article Portfolio Update – February 2020 – Coping financially after the corona virus

Portfolio Update – February 2020 – Coping financially after the corona virus

  • Corona update: All Seasons Portfolio development was -3.46% 21 Feb to 6 Mar, compared to -14.33 All-World Stocks
  • Bonds helping to avoid the worst drawdown
  • Stocks, gold and commodities in negative territories, while gold has gained back some losses during the beginning of March
  • All Seasons Portfolio Strategy shows its value during shaky markets; it is good to diversify across asset classes to decrease portfolio risk
  • After these few weeks, my confidence in the strategy remains strong

Hi and welcome back,

Let's cut to the chase straight away - it is during special circumstance that I write this month's portfolio update. February har been a rocky month all over the world and asset types. I am sure you have felt the effects of the spread of the corona virus Covid19 in your portfolio. I guess that you are also very curious about how the All Seasons Portfolio has performed during a time when the VIX index, which measures market volatility, has reached 54 (so far)?

Have you been at all curious how the All Seasons Portfolio strategy has worked out in the middle of the corona outbreak and the worries on the financial markets? Luckily, that is what I have set out to answer this month.

Considering that the All Seasons Portfolio is designed with the thought in mind that it should withstand the volatility on the stock market, my portfolio should have fared quite well? That is what I will answer in this month's portfolio update.

The layout of today's post will be that first, we will look at the past two weeks specifically how the All Seasons Portfolio has managed the risks of the corona outbreak and the volatility on the markets. We'll go through each asset classes and look into the day-by-day development of my All Seasons Portfolio. Lastly, we will look at the month-by-month portfolio updates as we always do.

Read more to find out how my portfolio has been impacted by the bear market caused by the corona virus.

Continue ReadingPortfolio Update – February 2020 – Coping financially after the corona virus
Read more about the article Insight – Why would anyone in their right mind buy Government Bonds with negative yield?!

Insight – Why would anyone in their right mind buy Government Bonds with negative yield?!

  • Yields are low and negative due to central banks' efforts to spur on the economic growth
  • There are still buyers of assets with negative yield, such as institutional investors
  • Government bonds are a liquid asset held instead of cash or other assets with risk for decrease in value, such as stocks in a bear market
  • Government Bonds make up 55% of the All Seasons Portfolio, and at the bottom, I summarize my ETFs

Soon, I have one full year’s history of the All Seasons Portfolio since starting in December last year with my first investment. I have come a long way since, starting from zero and now having accumulated a portfolio valued at EUR 3,700 in only 11 months. The main takeaway, which you should adopt, is to be disciplined and to continuously set aside an amount every month to invest. That will quickly accumulate, and you will also have that money working for you with compound interest.

As I already mentioned in the relevant blog post, in November, I made an addition on the Long-Term Government Bond part of the portfolio. This time, I purchased the iShares $ Treasury Bond 20+yr UCITS ETF USD (Dist) (EUR).

When posting about buying government bond ETFs during this first year, one particular question has always been brought up. It is a very valid question considering the current market conditions with low and negative interest rates. Why should you include government bonds in the portfolio, who in their right mind buys and holds bonds with negative interest and why do they do so?

Continue ReadingInsight – Why would anyone in their right mind buy Government Bonds with negative yield?!