Having a diverse portfolio of investments and assets is always a good thing to think about when planning your investment strategy and hoping for investment portfolio growth. For me, May and June showed how that diversity can help mitigate some of the risk associated with investing. After taking a big hit in my riskiest investment (cryptocurrency) and digging into my savings for a big purchase, I was able to offset those loses with the stability of my index investments, as well as my property value. Let’s take a look!
TFSA TD e-Series Index Funds
There still seems to be quite a bit of volatility in the global markets, with quite a few days in the last 2 months seeing big jumps and big dips. I was able to add a fair amount into my TFSA index portfolio – adding $1,500 in total, and spreading it out over the 4 assets to try to stick to the 23%/23%/23%/31% target as much as possible.
The TD International Index Fund saw a sizeable loss over the 2 months, losing over a hundred dollars worth of value, but this was made up for by the other 3 funds, and I saw a total return of $416 over the 2 months – almost a 1% increase in value in 2 months.
At this point, my total profit over 1 1/2 years for this investment is $2,150! Remember, index investing is about slow, steady growth over time, and so far, that’s exactly what I’ve been seeing.
RRSP TD e-Series Index Funds
With a little extra money in my account in June, I decided to add a little more to my RRSP account, continuing to payback my Home Buyers’ Plan and replenish the money I withdrew (tax free) from my RRSP to put a downpayment on my condo 6 years ago. Continuing with my 33%/33%/33% strategy, but also taking into account that the minimum transaction buy in TD Direct Investing is $100, I increased my RRSP shares in the International and US Index Funds.
May and June saw an increase of $65 in my RRSP investment portfolio, seeing a similar return to my TFSA index portfolio.
High Interest Savings Account
As I mentioned in my last update, I’ve got an exciting vacation coming up that required dipping into my short-term savings account. As much as I like to preach the importance of saving money, what’s the point of diligent saving without splurging once in a while.
So far in July I’ve already worked hard to replenish this amount, but I’ll cover that next month. You’ll also notice that my interest earned over the last 2 months seems quite low.
As the end of my Tangerine High Interest promotional rate was ended (which wasn’t all that high to begin with), I started a process to be able to take advantage of their next promotion. I transferred all of my money from my savings account into my regular chequing account in June. When Tangerine offers a new promotional rate, the new rate only applies to NEW deposits to your savings account, and excludes any funds already in your savings account when the new promotion starts.
By moving my funds to my chequing account, I was able to activate the July promo, which is 2.5% until March 31, 2019, and then transfer all of my funds back into my savings account, now accruing interest under the new rate. I also have it flagged in my calendar that on March 30, 2019, I need to again move my funds back into my chequing account, so that I can repeat the process.
This is a process that I’ve seen many other people take advantage of, and I’m glad that I’m able to do the same.
The constant gain in my property value was able to offset some of the losses I saw in the last 2 months from my crypto investments (see below) and my savings withdrawals. My property has been a constant gain, and when property values stay stagnant, I still see equity increase with each mortgage payment I make.
You’ve probably seen it over and over again over the last few months. When Bitcoin and the cryptocurrency markets make big moves, you’ll see headlines about it everywhere, and the last 2 months have definitely not been kind to my crypto portfolio. Across the board, all of my different funds are down, and I lost a huge chunk of value in my portfolio, but the key, like most investments, is NOT TO PANIC!
I’ve said this before, but I see my crypto portfolio has a hobby investment, and also a medium-term investment. There has been many big jumps and drops in the crypto market before, and I’m hoping that this is just another drop that comes before another jump. But the key thing to remember here, is that my cryptocurrency investments are a very small part of my overall investment strategy, and I’ve only put in what I’m willing to lose. If my crypto goes to $0, I will be fine. That is why I have index funds, savings accounts, and property. And overall, I’m still up $186 on my initial investment!
2 more car payments, means increased personal value on my car. This is a pretty rough estimate though as I don’t know what the exact resale of my car is, and won’t be able to get a Canadian Black Book value until it ages a bit more.
Pension updates are only sent to me once a year, so the value looks the same (even though it’s not). Both me and my employer continue to add monthly to this pension program.
There you have it. Lot’s of ups and unfortunately, a few more downs these last 2 months, but I feel optimistic! With 2 major losses (in my crypto and short-term savings account), my net worth only went down by $70, mitigated by increases in the rest of my portfolio. And by the time of writing this article, I’ve already been able to replenish my savings (which I’ll cover next month). My TFSA and RRSP Index Funds continue to rise, and my property value provides steady growth as I move forward this year.