As you may or may not recall. Around November 2018 I decided to sell most of my dividend growth stocks to change my portfolio into a ETF based portfolio. Here I’ll discuss how this process is getting along and what I’m doing with my capital at this moment!
For a quick overview of my current holdings you can visit my Portfolio page.
Compared to my old DGI (Dividend Growth Investing) days, my current portfolio has much more depth to it. This aligns quite nicely with my Twitter username @DutchInDepth. There are much more layers right now, these layers are as follows:
Sold Call Options
Sold Put Options
Exchange Traded Funds
Exchange Traded Funds / Bonds
You can envision this list as a pyramid shape. ETF’s, bonds and fundamental stocks act as a nice concrete block underneath the ‘bigger risk assets’. On the bottom are a selection of ETF’s, consisiting of world wide stocks and bonds. Every month I add a bit of fresh capital and profit from my options into ETF’s to keep sturdying my portfolio.
I’m planning to get into a few high quality names from the DGI community like Unilever and Royal Dutch Shell when the stock price comes down a bit. Right now this portion of the portfolio consists of 55 shares of Altria and 35 shares of AbbVie. These purchases will mostly be temporary and funded with long term option premium income. Whenever I sell an option for a longer time frame, I gain quite a bit of money for the time being. Not using this money is a bit of a waste as I gain no interest on it. For now I will invest it in beaten down blue chips which provide me a nice dividend. Might the stock price appreciate, I might sell the stock to free up the money for options again.
I have seperated my technology stocks as a category because I feel these are more risky. However, looking for the extremely long term, I’m mega bullish on the technology sector and this is one of the reasons I want to be quite heavily invested there. Right now this section consists of names like AT&T, Alibaba, JD.com, Baidu, Qualcomm and ASML. I’m eager to add a lot of money to ASML whenever the price is right. I’m also looking to expand into the payment sector with names like Visa, Mastercard or Adyen. Unfortunately these are insanely expensive right now.
With a lot of money in these ETF’s, bonds and stocks my broker let’s me use 70% of the value as margin for options. This allows me to sell options without needing to put a lot of actual cash in my account. Options might be a bit to complicated to explain here, just consider that I’m selling options on stocks that are solid and I wouldn’t mind having to actually purchase. In the first five months of 2019 I’ve realised a profit of €3,899,62 selling options for myself and for a few other people.
I consider my portfolio quite decently diversified and with a great potential for short term and long term income. I’m still adding as much new capital as I can, so that I can expand my fundamental sections and sell more options.
For questions about any of my holdings or my investment vision, make sure to let me know in the comments down below or to message me anywhere on social media!