Category: Market outlook

Lessons from the past (analyzing my returns from 2007-2019)

Lessons from the past (analyzing my returns from 2007-2019)

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As is the norm when we enter a new year, I like to look back at the returns of my (Pension) portfolio from the previous year(s).

Is it time to change my AA (again)? I was quite conservative with my AA last year when I opted to move a great portion of my portfolio OUT of the stock market. And Boy was I wrong to do that! The stock market hit an all-time high (again), gaining close to 30% in 2019, which ultimately left my portfolio returns in the dust in comparison.

You win some, and you lose some – I’m not regretting my decision to change my AA, but the events of last year has made me reconsider my overall strategy for my Pension portfolio (which is part of my 3 Pillars of Wealth).

I’ve actually said it many times before on this blog, but allow me to repeat myself: Don’t do what I do, kids! 😛

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Boy, was I wrong!

Boy, was I wrong!

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2019 is drawing to a close, and as is the norm on the Total Balance blog (easy now hot shot, this is only the first full year of blogging!) it’s thus time to take a gander back at this years major events – good or bad!

My wife asked me yesterday, if I had a “highlight reel” ready for the year of 2019. I didn’t/don’t. I actually had to read through some of my old posts, just to remember WTF had actually happened this year – this is EXACTLY why I started blogging; To help me remember shit!

I fell over a post from December 2018 in which I highlight 3 events/problems that had occurred to me/us (because all bad things come in 3’s?!), and it dawned on me that all 3 “problems” actually resolved itself since! This just goes to show you that sometimes the best action you can take, is NO action!

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Why you shouldn’t invest like me

Why you shouldn’t invest like me

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I’m going to be the devils advocate today, and explain why I think you shouldn’t invest like I do. It might be a bit counter-productive, but I think it’s important to own your investment strategy, and in order to truly do that, you need to explore alternative options.

My (current) strategy is based on two elements:

  1. Predictability
  2. Accountability

 
I (currently) have a set goal to reach a certain amount of money, within a certain amount of time. This means that I can track my progress (closely, as you know) every month, and make adjustments accordingly, if I somehow fall behind. My (initial) goal is outlined in this post, where I calculated that in order to reach my (current) Total Balance goal of DKK 3 mio (€400.000) in 15 years, I need to average a yearly return of 8.3% (after tax).

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New Pension provider!

New Pension provider!

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Hello, new pension provider!
After waiting for about 3 months, my pension funds have now been moved to a new provider (chosen by the company that I work for).

I have been anxiously awaiting this move, as the new provider allow me to create my own custom investment strategy, in that they have a number of different funds, where you can choose to place your money (rather than just place them in an index or an actively managed fund with a certain stock/bond split, which is typically what most providers offer).

Since I started tracking my Net worth (which my pension currently constitute 40% of), I figured it could be interesting to write a post about the pension part of it, and get everybody to chime in, how they invest their pension funds. The general consent among “the mortals”, is that pension is an extremely boring subject – but not here! Not in the FIRE community! Here Pension is hot stuff! And so it should be!

So let’s get to it, people!

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Less is not always more

Less is not always more

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When I tell people that I’m currently planning to invest in a real estate project (rental property), their immediate reaction is: But real estate have become so expensive (again), are you sure this is the right time to go into real estate?!

This is the typical reaction, because people look at graphs of the real estate prices, which have only gone one way since 2010 (the same way as the stock market) – UP! – And they then conclude that real estate is expensive. Which of course is also relatively true – but what if we factor in the price of borrowing money – also known as, the interest rate?…

Join me, in a quest to discover, if real estate (in Denmark) is currently expensive (or not)…

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