Sector Watch & My Kids Portfolio : Passive Income Report Update 2018

Past week Saint-Nicolas did pass the house with chocolates and other goodies. Little kids always look forward to the night of the 6th of December when this holy man brings toys and delicious chocolates. A tradition that still prevails for kids in the Netherlands and Belgium. Our kids are already teenagers and didn’t ask a credit card, like the blog post picture…lol. No, they were happy to receive some pocket money and dividends this month.

The stock market remains volatile and hard to predict going forward. Past week was one of the worst week since March. For some market experts, this marks only the beginning of a rocky period for investors that will continue.

“We think that this week’s turbulence provides a reasonable guide to the trends to watch for in markets next year,” said Oliver Jones, markets economist at Capital Economics. “In particular, while both the S&P 500 and U.S. Treasury yields have started to drop a little sooner than we had previously anticipated, we still suspect that both have much further to fall in 2019.”

Jones is not alone in the view that 2019 will not just provide a more challenging year for investors, but represent the beginning of an outright decline in the stock market. Savita Subramanian, a strategist at Bank of America Merrill Lynch, said in a note to clients last month that, “in 2019, we see elevated likelihood of a peak in the S&P 500.”  Subramanian’s year-end 2019 target is 2,900 for the S&P 500, but her team currently forecasts the benchmark index getting to 3,000 before rolling over.

It’s always interesting to read analyst or strategist predictions…afterwards they always have an explanation why markets did differently or did act accordingly.

So let’s move on to our Kids Portfolio. A portfolio I started with 10.000 Euro. We will grow this portfolio as an emergency fund for the kids and as big as possible.

Market Sentiment and Sector Watch

The market sentiment is remaining to the selling side. You see the market bounce and fall again. Since january we have basically been trading in a range. Take a look at the line I drew on the graph. Are we in a consolidation phase before going down or up ? According to some hedge fund managers the last earnings season was the worst they have seen. Banks and fund managers are accumulating more cash and are more prudent. We did hedge our dividend portfolio against further declines in value.

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 allows you to make your own analysis.

Consumer goods and healthcare remained stable. Did you see the graphs of the companies Merck, Eli Lilly and Pfizer for the year 2018 ? Strong solid bull graph. Investors have been rotating to defensive sectors like the utilities sector. The tracker FXU has been the strongest in this sector and since march 2018 it had a nice bullish run. 

Be aware we are not a financial advisor. Execute your own risk analysis and investment research. Read our disclaimer. We hope this sector review was useful for you to understand market opportunities and how we analyse potential opportunities.

Let’s dive in the passive income update for my kids portfolio.

Dividend & Options Income Update

During the month of October and November 2018, we received 99,7$ passive income. Only Dividend income. We didn’t focus on generating options income in this portfolio.

Portfolio analysis and Growth Strategy

We started with an amount of 10.000 EURO . The 2018 goal for my kids’ portfolio is to generate 1000$ in the total year. We achieved 87% of our yearly goal so far. 

We have 866$ in our pockets so far ! We keep on grinding forward to our yearly objective.

Going forward

We are little more than 20 days away from the year end and we just need 133$ to make our goal in this portfolio. I believe during my christmas vacation break I will plan one or two days options trading in the SPY tracker. This can give me the required 140$ that I need. I can also lose money but I will manage the risks properly. We will see. You will read about it in January 2019.

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!We hope you learned something from this blog post and keep on following us on Twitter and Facebook. As always we end with a quote.