Nov 052018
 

It was bound to happen sooner or later. October was a bad month for the stock markets. Some of my highest growing stocks in the technology sector such as Facebook, Amazon, Netflix, and Google (Alphabet) or FANG stocks fell into bear market territory, which means they’ve fallen by more than 20% from the top. Here is a look at how much stock indexes lost in the month of October.

  • TSX Composite -7.5% (Canada)
  • Dow Jones -5.9% (USA)
  • S&P 500 -7.9% (USA)
  • NASDAQ -10.7% (USA)
  • ASX 200 -6.0% (Australia)
  • FTSE 100 -5.4% (UK)
  • SSE Composite -6.2% (China)
  • Nikkei 225 -12.4% (Japan)

My investments weren’t able to escape this global stock market correction, and my net worth fell a bit. I hope the next couple of months will make up for it.

 

Liquid’s Financial Update

*Side Incomes: = $7,300

  • Part time job = $600
  • Freelance = $500
  • Dividends = $900
  • Interest = $600
  • Farm rent = $4700
*Discretionary Spending: = $2,100
  • Food = $400
  • Miscellaneous = $500
  • Interest expense = $1200

*Net Worth: (ΔMoM)

  • Assets: = $1,224,200 total (-15,900)
  • Cash = $17,500 (+4700)
  • Canadian stocks = $167,100 (-9700)
  • U.S. stocks = $117,100 (-9,800)
  • U.K. stocks = $20,700 (-900)
  • Retirement = $114,700 (-600)
  • Mortgage Funds = $34,200 (+100)
  • P2P Lending = $32,900 (+300)
  • Home = $275,000
  • Farms = $445,000
  • Debts: = $421,000 total (-2,700)
  • Mortgage = $190,700 (-500)
  • Farm Loans = $180,900 (-600)
  • Margin Loans = $49,400 (-100)
  • CIBC Line of Credit = $0 (-1500)

*Total Net Worth = $803,200 (-$13,200 / -1.6%)
All numbers are in $CDN. 

 

This was the first down month I’ve had in over a year. A few things saved my net worth from dropping further: My farmland paid me some rent. My fixed income all ended the month with positive returns. And despite being invested in the stock market for the past 9 years, stocks only take up about 34% of my assets. This means any changes in the overall stock market will probably affect my net worth by only 1/3rd as much. 🙂

 

 

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Random Useless Fact:

Some people say Elon Musk reached puberty in his 30s

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R4434Liquid IndependenceKhan Recent comment authors
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Khan
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Khan

Hey Liquid, I was wondering about the effects of raising interest rates on your portfolio (if any)? What investment strategies do you suggest during such times i.e. buying any specific stocks, golds/silvers, investing in real estate etc?

Liquid Independence
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Higher interest rates means I will be paying more interest on my debts. The strategy I use is to pay down my liabilities more aggressively to reduce my overall cost of debt. This means I have less money saved every month to invest but that’s okay. I think financial stocks are still a good buy right now. I’m neutral on gold/silver right now because they don’t pay dividends, but should still go up in the long run. Real estate is probably the only asset class I would stay away from right now. There are people who bought homes before 2017. When they renew their mortgage in the next couple of years interest rates will be at least 1.50% higher. The market at least in Canada is cooling and it’s likely that housing prices will be lower 1 year from now after interest rates go up a couple more times. than before.

R4434
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R4434

There is nothing wrong with losing money some months, as long as the overall trajectory is sloping upwards.

I’ve noticed that you haven’t really suffered a bear market yet, but when you do, don’t panic. Keep on keeping on, my friend!