Not that much has changed compared to previous quarter. Global economy is mainly dominated by still ongoing COVID-19 pandemic and BLM protests in US as they prepare for presidential elections. There were ups and there were down during the quarter. Index level recovery has been surprisingly quick one. Personally my portfolio is still down mainly due to the heavy REIT allocation. Lately I’ve been holding back a little bit as the elections are likely to provide some turbulence together with second – and third – corona wave.
Dividend income before taxes during Q3 was 871,88 EUR (Q3/2019 1 206,75 EUR). Corona is clearly showing but not too badly. Impact was way clearer during last quarter as the Euro dividends have been cut or postponed especially in financial sector.
Tiny maintenance purchase with 25 shares of CapMan bought for 1.98 EUR per share to keep the streak going. Strict cash balance reservation didn’t allow bigger purchase this time around. Let’s see how the market moves in coming weeks. I might dip into my reserves if we see bigger moves.
Minor maintenance purchase time. I bought additional 14 shares of Fortum for 16.925 EUR per share. Fortum appears to be very reasonably valued at the moment even though there are clear risks as well. Unfortunately significant amount of those risks are of political nature. Still, it’s possible that political reasons might eventually work also in favour of Fortum. This could happen e.g. via European investments on hydrogen economy in which Fortum/Uniper is reasonably well positioned. I might increase my stake in Fortum with larger chunks later on. This was just maintenance purchase to consume some leftover cash.
Time for some trades. I sold my tiny CoreCivic position which consisted of 160 shares for 8,60 USD per share . In retrospect should have moved a lot quicker when they announced the plans to dump REIT structure. It might very well be a good long term move but I have my doubts and it will anyway take a long time to materialise. This move allows me take the loss for taxes and I might trade it later if the plan is executed well enough.
In addition to that I bought additional 44 shares of Aflac Inc. for 35.28 USD per share. It’s been a long time since the last addition. Aflac is one of those companies that seems to be consistently reasonably valued. It represents the lower but more consistently growing dividend in my portfolio. That’s something I’ve come to value even more in times like these.
Third one is a bit special one. I bought additional 330 shares of Sampo Plc for 30,57 EUR per share in my secondary portfolio. This is the exact amount I’m holding in the primary portfolio. This short term overweight position is protected by stop loss order in the primary portfolio which I can drop without taking a tax hit.
Minor maintenance purchase with a bit more risk this time. I bought additional 100 shares of Apple Hospitality REIT for 8.76 USD per share. Minor addition as the post-COVID era isn’t with us too soon I’m afraid. I’m betting my money on it anyway but not fully – yet. World might look marginally brighter already in Q1/2021 but perhaps real recovery will happen in 2022. By then I might have doubled my Apple Hospitality stake.
This was a bit unexpected but Sampo has been dropping now that news about it’s discussion to acquire british Hastings Group hit the news. Apparently these discussions have proceeded quite far but since the possible valuation has not been revealed, it’s really difficult to have any opinion about it. What we do know is the fact that Sampo’s market cap has likely dropped way more that the anticipated price for Hastings Group stake. Apparently Mr. Market doesn’t like this move even though it does make sense in many ways but might put pressure on the dividends and might also raise some concerns about the future of the Nordea stake they are holding. There are plenty of open questions but I bought additional 60 shares for 30,40 EUR per share.
Monthly maintenance purchase time. I couldn’t come up with anything fancy so I bought additional 400 shares of CapMan for 1,946 EUR per share. I’m not a huge fan of the market environment at the moment. This is especially true in Europe with all the EUCO related things but I worry mostly about the long term effects. Short term? Who knows. Global situation in few months time frame could be anything between sun shine and gloom & doom. Second round of COVID-19 will probably come in shape or another. Vaccine might come sooner or later. US elections and BLM might move on and calm down sooner or later. Seeds for dismantling European Union might have been now sown but that remains to be seen and will most likely take quite long to materialise. Having said all that, there’s probably no reason to change my long term plans. Keep buying, focus on quality businesses making profit and try to minimise effective taxes when possible.
Second quarter was a wild one with all the COVID-19 and BLM related issues around the globe. Both are still very much ongoing but perhaps winding down a bit. That of course can be just calm before the perfect storm but that remains to be seen.
Euro zone is not looking very good. COVID-19 recovery package is being negotiated and seems to be headed to slow spiralling death. I’m sure this can will be kicked patiently quite a bit further it probably should. Eventually however inevitable will most likely happen and euro zone will crumble at least partially. It’s probably impossible to estimate time frame for such event or even the nature of it. Due to to political reasons it might take way longer than it should. Alternatively of course it’s possible that all the issues will be resolved resulting a stronger Europe and currency. Personally I even hope so but don’t see it as a likely outcome.
Dividend income before taxes during Q2 was 1553.07 EUR (Q2/2019 3047.48 EUR). This was statistically a slight disappointment as some of the scheduled dividends were either cut or at least postponed (regulators prevented dividend payments for banking and investment companies).
Tiny maintenance purchase for secondary portfolio to keep the streak going. I bought additional 60 shares for 1,96 EUR per share. Slow build up to medium sized position is in the cards during next six months or so.
Monthly maintenance purchase and this time around it was CoreCivic. Pandemic has calmed down a bit but is far from over. Meanwhile black lives matter movement has been wreaking havoc especially in US. All this together with the approaching US presidential elections should keep prisons full in coming years. It’s difficult to see how private prisons would be scaled down any time soon. There are long term contracts in place and new ones have been signed relatively lately. Therefore I bought additional 80 shares for 12,27 USD per share.