Sector Watch & My Kids Portfolio : January 2018 Dividend Income Report

Last week of February has kicked in. Last weekend I posted my key learnings blogpost from Day 1 from Rich Dad Summit. This weekend I first want to give an update on the market sentiment and my kids’ portfolio. You will have to wait a little longer and stay tuned if you are interested in reading my key learnings from Day 2 of the Rich Dad Summit. Sorry 🙂

Let’s take a look at the market sentiment.

Market Sentiment and Sector Watch

Yesterday I visited the Technical Analysis day of VFB, Flemish Investors organization. This was a great opportunity to hear what investors’ magazines and analysts are ‘predicting’ for the markets. What do they believe the market sentiment is? I summarize the three analysts below :

• Geert Van Herck (Keytrade) : Be alert for a trend turnaround. Correction at international markets.
• Danny Reweghs (Inside Beleggen) : Chances on a strong market correction increase as the year progresses. Move over more to cash before the summer or end of year. Invest more in Gold.
• Marc Brems (Beurssignaal) : Marc Brems advises cash or dividend shares that bottom out and be picked up at lower prices. The technical trend prevails.

Geert Van Herck showed below slide which shows the Euphoriameter.  The Euphoriameter combines 3 key gauges of investor sentiment:
-Surveyed Sentiment (Bulls) i.e. the bullish sentiment readings from investor surveys (or how optimistic investors say they are)
-Forward PE Ratio i.e. price vs next 12 month consensus earnings (basically a reflection of the relative degree of confidence in future earnings growth)
-The VIX i.e. implied volatility (whether conditions are in panic mode or complacency)

The composite view is designed to give an indication of the level of “euphoria” or otherwise in the market, and has given key insight into the market at turning points.

2017 was such an amazing bullish year that now retail investors returned (late) to the stock market. This is a sign that we need to be more cautious. We got our first warning in February. The market sentiment turned more cautious.

Let’s take a look at the Sector Watch. Here we look which sectors we should invest in and what is different compared to last month. We placed the latest Sector Watch graph below…This always you to make you your own analysis.

We see that all sectors had a retracement and correction. The only sector that survived the recent correction were the financials. But will that last? We think at current high price/earnings ratios and valuations all stocks will need a correction. Consumer goods had the biggest drop.

We hope this market review was useful for you to understand market opportunities and how we analyse the sectors.

Dividend Income Update

Now let’s take a look at the dividend income report of January 2018 for my kids’ portfolio!

During the month of January 2018, we received 87,41$ dividend income.

Portfolio analysis and Growth Strategy

We started early 2017 with a starting amount of 10.000 EURO . The 2017 goal for my kids’ portfolio was to generate 600$ in the total year which equals to an investment return of 6%. We have ACHIEVED 105%  of our 2017 objective. In 2018 we have set the goal higher…1000$. We locked in 9% as start of the year. Not bad. 

We did not deploy ALL our cash (only around 70%). So actually we made 8,7% on our capital deployed ! As you could read in the blogpost How to grow your 10.000 Euro, we also started a portfolio growth competition with Paul D’Hoore. Let’s see if we can make more money than Paul in the coming years.

So do you think …ooh you only made 87,41$ ? Do you know how much money needs to be on your 0,11% savings account to receive this amount in 1 year ? You need more than 79400 dollar.

Going forward

Our cash position has increased to 3900 Dollar. We are working out new strategies to use the dollar cash to generate passive income each month. We got our account approved for options investing and succeeded for our exam.

The goal in this portfolio is to grow the cash amount per month while growing the account and get better each month in doing so.

Good luck with your personal finance strategy for your kids! Thanks for reading.

Putting money on a savings account for your kids is NOT a strategy to make it grow! 

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