5-Bullet Sunday

5-Bullet Sunday – #25

It’s been a very long week with lot’s of long days at work again. Hopefully I’ll be able to get back to normal again during the summer, because this isn’t sustainable health-wise.

Having said that, I’m always very excited to share with you my 5 bullets from the week and today is no difference 😍

Enjoy this week’s 5-Bullet Sunday!


5-Bullet Sunday is a weekly blog post with 5 topics that were on my mind this week related to Financial Independence and Dividend Growth Investing or something that just fed my curiosity. An overview of earlier posts can be found here

🌟 Dividend Talk – Podcast

What a great first bullet today πŸ₯, because I would like to introduce you to a brand new podcast series that I started together with Engineer My Freedom (Ireland).

It is a new weekly podcastΒ where we discuss dividend growth investing and related news from within our community and the stock market. The structure of the show will typically be:

  • a brief reflection on the news from last week
  • discuss a certain Dividend Growth Investing related topic
  • address a follower request
  • sharing our stock pick of the week

All this with a European flavor!

To be honest, this is actually the podcast that we were searching for ourselves. Most of the podcasts that we know are US based and those often don’t address certain topics that are on our minds (i.e. allocation EU vs US, Tax, European stocks).

Having said that, we aim to record our show every Friday night and publish it on Saturday before noon. We will also address your requests. As an example, we provided last Friday some feedback on a portfolio shared by one of our Twitter followers.

Interested?

Follow us and subscribe to the YouTube channel or Spotify if you want to stay notified about our upcoming shows πŸ‘‡

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Did I make you curious? Have a listen at Episode 1 and let us know your feedback πŸ™

My comfort zone has pretty much extended again, but that’s how I learn and grow as an individual ✍

🌟 DeGiro account opening struggles

DeGiro is a favorite stock broker among many European investors. Hence why you might hear us talking quite regularly about it.

I personally really like DeGiro, because it gives me a lot of market access at a very low cost. There is neither a monthly management fee, so my costs are very low compared to Binck NV, my second broker.

If you are a new investor and you haven’t opened an account yet at a stock broker, then I would really like you to know that DeGiro is really struggling with opening up new accounts.

The recent pandemic saw a huge influx of new investors to the stock market and that’s the reason why waiting times can currently take up to two months!.

If you want to open a new account and quickly start trading, then I would currently recommend you to look at other European stock brokers.

If it’s no problem for you to wait that long, then DeGiro might just be worth waiting for.

🌟 Sell in May?

There’s an old traders wisdom:

Sell in May and go away. But remember to come back in September

It’s June now and the market is still very volatile, so I wouldn’t follow that advise myself. And as you know, I am a buy-and-hold investor and I would never sell positions from my portfolio just because vacation is starting.

But then again, I recently learned that some of you might not feel so sure about a certain stock or just want to protect their portfolio against an unexpected event. Who knows whether you’ll have the next General Electric or Wirecard in your portfolio?

I personally believe that you can do as much as homework as you want, but something like fraud can happen to all of us and it usually comes unexpected without any clues upfront. That’s the intention of the fraudulent peron(s) in the first place.

I also really understand such sentiment very well as I lost myself quite a lot on General Electric. Let’s consider it an expensive learning experience which could’ve easily given me a year at business school over here in Poland πŸ˜‰

So how do I avoid this then? Well, I just don’t. But this is the kind of my formula on how I limit such risk myself:

  1. Limit single-stock risk.
  2. See rule #1
  3. See rule #2

Let me explain my thoughts a bit further:

If a company would go bankrupt over night, then it would cost me today a maximum 10% of my whole portfolio (ref: bullet-5 πŸ‘‡). This is a lot, but not too much. The stock market grows on average with 10% per year when dividend distributions are included.

This would hypothetically mean that I would have had a flat year. But as per my allocation strategy, over time this would cost me maximum 4% once I’ve finished building my portfolio. 10% average growth – 4% loss would still give me an average of 6% growth going forward.

This is the reason why I’m not spending too much time on preventing a black swan event like Fraud, even though I might not be paying that much attention to my portfolio while I’m on vacation 🌴.

And definitely I would never sell in May….

🌟 Recommend Reads

CNBC published their yearly disruptors top 50. This is typically one of those lists that I’m every year looking forward to. My favorite three companies from this list that I would love to see going public are:

  • Coursera (I love their trainings)
  • Impossible Foods (supporting vegan lifestyle)
  • UIpath (favorite tool for process automation – RPA)

Young Hamilton wrote a short post about the recent rally in the stock market. Is it just the beginning or are we up for a pull-back? I like his macro-level perspective on it and I believe that his prediction might be just right. Provided off course that we won’t see another large wave of the coronavirus this fall…

🌟 Recommended Video

Microsoft became the biggest position in my portfolio after the significant drop in share price from Shell 3 months ago. My exposure to Microsoft is approximately 9% compared to my overall portfolio. I believe that my average cost price is about 65 USD.

Having said that, the question that many investors have in mind now: should I sell or trim Microsoft?

My answer this time is provided by Kevin O’Leary πŸ‘‡


That was it for 5-Bullet Sunday, edition #25

A hit on the like button πŸ‘‡ always puts a smile on my face 😁

Have a good remainder of the Sunday!

Yours Truly,

European Dividend Growth Investor

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