Path to Financial independence – Introduction to end of 2017 financial baseline

Today’s Blunder: “Not realizing how to make money work for you. Invest and Diversify!”

As mentioned in our previous post, financial intelligence is a new area for us and we are educating ourselves each and every day. One of the areas that we are focussed on is dividend investing (  Link to learn more   ) and we will try to provide monthly updates regarding our performance. There are certain factors that we need to take into consideration, such as our family setup (3 children) and being expats (Lived in 12 different countries, something for a different post).

We will be sharing which shares we have, how much dividend they provided in the specific month and what we learned. The following books provided us with a basic level of understanding so we could start:

This month, we will share our current financial status and baseline. First we’ll provide an overview of the shares we have and then describe why we invested in them. Do let us know if you have any comments and/or suggestions.

SharesTickerUnitsCurency
Vanguard FTSE All-WorldLSS:VWRL50$
Vanguard FTSE All-World High DivLSS:VHYL200$
Realty IncomeXNYS:O90$
HasbroNYX:HAS14$
MicrosoftNYX:MSFT15$
GoDaddyNYX:GDDY150$
Equiniti GroupLSS:EQN6071£
Games WorkshopLSS:GAW415£
Shs BritvicLSS:BVIC1000£
Royal Dutch ShellENX:RDSA633
Unilever CertENX:UNA81
Smurfit KappaIRX:SK3125
AbertisSIBE:ABE350
Bank of Novia ScotiaTMX:BNS150CAD
Dream Global REITTOR:DRG.UN500CAD
RocheSWL:ROG155CHF

As you can see, we’ve tried to diversify across the globe and in many different industries. We started with 2 Vanguard ETF’s that have a global spread. We chose these due to the high amount of diversity and low costs associated.

In the US, we chose a monthly REIT provided ( Realty Income ) that is well known for their dividend policy. In addition, we invested in 2 companies, Microsoft and Hasbro, that have shown a capability to spot future trends and benefit from them. GoDaddy is an outlier as it doesn’t have a dividend policy, but we believe that this company can become a key leader in internet content in the future and will pay out a dividend in the future.

We also looked at the United Kingdom, as they have a 0% tax policy regarding dividends (up to a limit). In addition, the British pound exchange rate is pretty low at the moment. Equiniti group helps companies in Britain and the United States in managing their shareholder policies and payout. Games workshop has shown tremendous growth over the last 12 months and has a very progressive dividend policy. Lastly, Britvic, which owns key beverages in the United Kingdom as well as having a healthy exposure to Brazil.

In Europe, Royal Dutch Shell and Unilever are 2 companies with a proven long term return value for their shareholders. They are able to diversify and manage their huge conglomerate organisations. Smurfit Kappa is a play on the increasing paper and cardboard demand, partly due to the increasing web-purchases. Abertis owns key toll roads in Spain and France and their roads provide a consistent flow of cash.

Canada has a strong economy and the 2 Canadian companies we chose we Bank of Novia Scotia (well established and low debt) and Dream Global (monthly paying REIT). We feel comfortable to have exposure in Canada.

Lastly, we believe that healthcare is an essential need and that Roche provides the perfect play for that industry. It is the only company that has a world-class Pharmaceutical division as well as a world-class Diagnostics division. Market leadership plus strong history of dividend payments make for a company that we want to invest in.

Next time we’ll go in detail and look at the progress we have made regarding these investment. Do let us know if you would like us to go detail regarding a specific investment.

What was your latest investment?

 

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