General reflections
If 2024 proved anything, it just showed that the stock market can be very good at ignoring the troubles of the world. The Russian-Ukraine conflict persisted into its third year, with Ukraine now even pushing into parts of Russia; the war in Gaza and the Middle East continued and spread into other countries; liberal democracies are under pressure in most countries (e.g. France, Germany, USA); Donald Trump was re-elected to become president; and natural catastrophes abound as the effects of climate change are becoming more and more visible.
Watching the news is an exercise in doom and gloom - and yet what did the stock market do? Just like last year, almost every single major index soared to new heights and climbed double-digits. The valuations are becoming worryingly high, but for now there seems to be no stopping to the stock market, which was once again carried heavily by the magnificent seven. And if you felt bored by the returns of the common indexes, why not simply invest in Bitcoin, which cracked the $100.000 barrier this year?
Given that my portfolio is rather focused on income and does not feature the all-carrying force that is technology, which seems to lift all boats, I have to say I'm very pleased with my return. My portfolio grew by 10.3% (excluding dividend) and by a whopping 18.50% (including dividends). This underlines the contributions that dividend make to the total return of an investment.
Just like last year, I cannot omit two dividend cuts I had to take on the chin this year: 3M cut theirs though I sold them (at a loss, for full disclosure) before that already; MPW, the infamous battleground stock (yes, I'm still in it and still undecided whether to double down or sell), cut their dividend again. Something else which I did have to bear was the increasing mania for regulations by the EU, which (for reasons I cannot quite fathom) will not allow me to invest in such interesting vehicles such as US ETFs, US CEFs and more (my thoughts on this and the conclusion to which I came can be read here). That's just a thing I will have to grin and bear.
In 2024, I also made the decision to go for more high-yield investing and sold lower-yielding investments (such as a few acclaimed tech stocks). While these are excellent companies, the math does just not work out for me in terms of income I collect. It would take years, nay decades, to reach an adequate yield on cost which gets me closer to my desire income via dividends, which in turn will allow me to either a) retire early or b) work less or c) travel the world or d) something else altogether (I touched on this here.
The (dividend) numbers
In total, I received 6.177,13€ in dividends in 2024, thus falling a little short of the very ambitious goal I had set myself the year before (6.5000€). On average, this comes out to 513,85€ a month, which is nice as it would cover either my current rent or my insurance costs per month. It is somewhat gratifying to know that if even I stopped employing money from my salary now and only reinvested the dividends I already get, I (most likely - you never know what will happen) will be good for the future for one of those two things. These are little milestones that push me further along on this long way to whatever is waiting at the end ;-).
I will not set myself a goal for this year, as I am not sure as to if I will be able to invest the same monthly amount. My much better half and I are currently discussing different options what to do in the future, and it might be the case that I will save my monthly contributions for different things. The only thing I secretly would like to reach this year would be to crack 1000€ in a single month.
My best month in 2024 was June in which I came somewhat close to that aim and collected 787,19€ in dividends. The worst month (as it was last year and as it will be this year, I presume) was February in which I got a measly 272,77€. Compared to last year, my dividends for this year grew by 33,85%, which is very nice, but you can see it gradually slowing down (from 2022 to 2023, for example, it was still growing by 55,19%). Still, the snowball effect is palpable.
Retrospective: The year in stocks
The biggest winners in my portfolio for 2024 were ...
1) Iron Mountain: 67,18%
2) Kinder Morgan: 66,34%
3) SL Green Realty: 65,4%
Iron Mountain was already one of the winners last year, which goes to show that (for better or worse) stocks that have already surged/plummeted quite a bit can continue to do so. With regard to SL Green Realty, I have a few regrets. Even though office REITs might not have the future as they were projected to have a few years ago, I was still somewhat bullish on them as I thought that New York, regardless of home office policies or not, will always be an attractive location. Still, I was too timid to buy more, which I now regret. Speaking of regrets, let's have a look at the losers of this year ...
1) Ares Commercial Real Estate: - 35,24%
2) Innovative Industrial Properties: - 27,20%
3) Horizon Technology Finance: -26,91%
Number 1 and 3 are very small and very speculative positions, so the losses, while painful on the surface, don't cut too deep. IIPR is equally speculative and a slightly larger position, though I am somewhat bullish on them and might think about buying a few more shares.
Personal highlights
Looking back on 2024, I feel personally somewhat blessed by all the incredible things I was able to experience. In April, I ran my first full marathon with my brother and we were both able to reach our goal and finish in under 4 hours. I was also asked to play the guitar during the wedding ceremony of my sister, which I nervously agreed to, but it all worked out fine and my siblings and I had a blast at the party afterwards. There were also very memorable holidays I got to spend with my love: During the summer, I went on my first road trip across Iceland, marveling at its breathtaking landscapes and walking on a glacier. In November, I made my first trip to South-East Asia and spent two lovely weeks in Thailand and enjoyed the madness of Bangkok, the delicious food, a two-day jungle hike and the pristine waters of Phuket. And to top it all off, I once again returned to Ecuador in December/January and spent Christmas and New Year's with my girlfriend's family and was able to further explore Ecuador and (considering its relatively small size) diverse landscape. Next time I'm there, the Galápagos Islands will be waiting for me - no more postponing.
Closing Thoughts
And with this lovely image in mind, I am now happily and gratefully closing the book on 2024, thanking my lucky stars for the blessings I was able to enjoy. I hope you had a good year as well, and I wish you nothing but the best for 2025.
Over Christmas, I re-read parts of Moby Dick and came across this quote, which is a good as any for 2025: "I know not all that may be coming, be it what it will, I'll go there laughing." Since I can’t be as bold as Melville, I’ll adapt it: "I know not all that may be coming, be it what it will, I [hope] I'll go there laughing." Good luck to you in 2025!
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