2022: A (stock market) review

General reflections

2022 will be remebered for a lot of things: the horrific and still on-going war in the Ukraine, sky-rocketing inflation, the FED, the energy crisis, the on-going pandemic (and particularly the consequences in China because of their "Zero-Covid" policy), devastating heatwaves and droughts, the flood in Pakistan, Queen Elizabeth II passing away, chaos in the UK (remember Liz Truss?), courageous protests in Iran, the controversial world-cup in Qatar and probably a few more things that slipped my mind.

It will also, in a very small footnote in history books, be remembered as rather a bad year for the stock market. Nearly every major index fell: the S&P 500, for example, fell by almost 20% while the NASDAQ fell by an astonishing 35% from their respective all-time-highs.

My portfolio was of course not exempt from the general malaise. For the entire year, I am down -2.38%. This might sound cute compared to the rather steep drops of the major indexes cited above, but of course I had the advantage of DCA throughout the whole year. Without the dividends I received, I'd be down -6.71%.

This is my second year of dividend (growth) investing and I have to admit that amid all the panic, desperation and sell-offs, I felt if not comfortable (one never is, right?), but at least ok during this time and if this is indeed one of more punishing years in recent history, I think I'll be fine in the long run with the investment strategy I follow right now.

The (dividend) numbers

In total, I received 3433.24€ in dividends after taxes, a whopping 245% increase compared to the year before (my first year of dividend (growth) investing) in which I received roughly around 1000€.

On average, I received ca. 286€ every month, with May being the sweetest month (ca. 583€) and February the lowest month (ca. 185€) and the only month under 200€. February, August and November tend to be my weakest months whereas March, June, September and December are my better months. 

My yield after taxes is 3,42 %.

In general, I am quite pleased with the increase. My goals for next year are cracking 4000€ in total dividends and reaching an average of 300€ (or more) every month.

Retrospective: The year in stocks

Looking at the best and worst stocks of the year, you clearly see the year we've just had. My biggest winners for the year are ...

• Exxon (+92%)
• BP (+36%)
• Shell (+33%)
  
• Total Energies (+32%)

Notice any similarities ;-)? (Literally) fuelled by the energy crisis, these stocks knew only one way throughout the year: up, up, up!

I bought most of them - without really knowing what I was doing - in my first year investing in the middle of the pandemic in 2020. It was literally the biggest beginner's luck you could stumble into. In hindsight I feel both lucky for having bought them at their lowest points, but at the same time I could kick myself for not having bought more back then. Let's have a look at the steepest drops in my portfolio: They are ...

• Innovative Industrial Properties (-53%)
• SL Green Realty  (-49%)
• Vonovia (-48%)
• Alphabet (-35%)

Hit by inflation, most stocks in the real estate sector suffered (look, for example, at the dividend cut of the Swedish real estate stock Castellum). SL Green Realty is, as I mentioned in a post before, one of the stocks I'm thinking of getting rid off, especially after their latest dividend cut. With Vonovia and IIPR, I have to admit that I'm being a little greedy and steadily DCA my position, knowing perfectly well that this could backfire (hard!). Fingers crossed. 

The tech sector - after years of sheer never-ending growth - also came to a sudden halt in 2022. Alphabet is literally the only non-dividend stock that I have and, to add insult to injury, I bought it near its ATH. This one I will just have to wait out though I'm also considering to DCA a bit to lower entry price. For now, Alphabet is a big (and painful!) reminder of a) how important valuation is (at least in the short term!) and b) being in the red with a non-dividend paying stock is a lot more annoying than with a dividend-paying stock.

 

To all of you: Good luck in 2023 out there!