August 2024 was the real correction that we all were looking for. I thought July 2024 provided a nice dip but August was the real one. Even though markets rallied into the end of July, fireworks started the moment August hit. This was long overdue in my opinion and in the end, it proved to be a monster buy the dip opportunity.
The bull market that has been raging since November 2023 showed no signs of subsiding in until really the last two months. July had small dips of 10% on most of my favorite tech stocks which also drive the broader market. The markets rallied back at the end of July to close almost flat on the month. August was a whole different story. Whatever happened in July, continued on in August but at a much larger scale.
If you haven’t already read my posts before, I achieved Financial independence back in late 2020 early 2021 with a portfolio of roughly $1.3m invested in mainly ETFs. This ballooned to $1.7m during the peak of the markets in early 2022 before coming back down to Earth later in 2022. The portfolio has since regained new all time highs as markets rally beyond the previous highs.
This post will be part of a monthly series of portfolio updates that summarizes how my portfolio performed, what trades I executed, what my monthly expenses were, and my general outlook on the economy/markets. This is by no means financial advice so do not look look at me for sage advice. I make stupid trades and make even worse losses quite frequently.
This is simply the performance of my portfolio and how it has performed on a month to month basis.
Monthly Highlights – August 2024
Net worth is near $1.95m as of August 2024 Month end+$50k for the monthTraveled the first part of the month all throughout the Greek islands. I’ve spent a lot of time in the Greek islands before but it honestly never gets old. It always gets me feeling some kind of way being in those most beautiful of islands.
Market Moves
What is in my portfolio?
My portfolio is quite simple and straight forward. I have my holdings primarily spread out between a few ETFs, fixed income, and various single name stocks.
ETFs
Again, my primary holdings are in a few ETFs. My primary holdings are in VTI, VGT, and VCR. I’ve always been a big proponent of big tech and have been heavily invested in the Nasdaq for over a decade. This has paid off very well for me given the massive bull market of the 2010s and is essentially what allowed me to FIRE so quickly.
I used to hold more dividend generating stocks as I was really into this type of investing at a period of time. I currently do not have many dividend specific ETFs as I prefer growth more than income. This kind of goes against the ethos of financial independence but I have enough money coming in from other sources that I don’t need to focus so much on income.
I added to my ETF positions in August 2024 as the markets dipped almost 10% in the Nasdaq.
Single name stocks
Some of the single name stocks I own are the following
TSLABRK.BNFLXRITMASMLANETARES
These single name stocks make up less than 10% of my total portfolio. I tend to not buy much single name stocks anymore as there’s no point to take on unnecessary risks when I’m already so diversified with my ETFs.
Real Estate
I currently own no real estate. I used to own property in the US but have sold it in 2022 before rates started rising. I am not a big fan of real estate. While it definitely can be a good investment, I don’t think it beats investing in the markets. In addition, real estate is highly illiquid with high transaction costs that few people consider.
Finally, as someone that travels around the world and does not like to be tied down to one location, real estate doesn’t make sense as managing it from afar creates a bunch of headaches. I much prefer to have my money liquid and in the stock market.
Fixed Income
Due to rising rates, I’ve also allocated a small part of my portfolio (<5%) to fixed income products. I’ve been purchasing 5.5% yielding treasury bills with a 3-6 month expiry. I currently have about ~$60k invested in a 3-mo T-Bill that will expire in June 2024.
After expiring mid June, I bought another 3 month treasury paying about 5.4% expiring in mid September.
This is guaranteed money with zero risk which I decided to take advantage of while waiting for better entry points. However, it seems like this money probably would have been better used just buying the market but this is opportunity cost I’m willing to sacrifice.
I also purchased I-Bonds in 2022 at the height of inflation peak when I-Bonds were paying 9.5%. The rates have come down significantly since then as inflation itself has come down. The optimal time for me to sell these bonds were on Dec 1, 2023 as that would have been the last month I was eligible for the higher rate of 6.4% (still higher than what treasuries paid). As you must forfeit three months of interest upon withdrawal before 5 years, in total my blended rate of return was around 8% for 15 months which is definitely something I can live with.
August 2024 was one of the most action packed months of 2024. The month started with insane volatility as markets started flash crashing due to recession fears that the FED was not able to pull a soft landing. Markets plummeted the first few days of August dropping more almost 10% on the S&P and 15% on the Nasdaq in the matter of a few days. August 5 saw the VIX jump into the 60s which is absolutely insanity as those were levels last reached at the height of the pandemic. S&P actually even dropped to their 78.6 Fibonacci retracement levels.
Semi conductors like NVDA crashed 30% and big tech was thoroughly thrashed around. It seemed like the markets were heading towards a big plunge with bets picking up that the FED would cut rates out of cycle. I thought the panic was a bit ridiculous and bought hand over fist. I just didn’t see the reason for such a steep pullback and nothing had really changed in the direction of the economy. I saw it as a very healthy pullback on a market that was running up super fast.
Surely enough, markets immediately rebounded, VIX crashed back into the teens and the stupid permabears were once again crushed. I bought dips primarily in tech as I think it crashed way too much way too fast.
In the end, markets rebounded all the way back with the Dow Jones actually setting new all time highs. The markets are just crazy and I suspect we will be in a buy the dip mode until at least the elections this year. I can’t see the FED letting the economy crash as Jerome Powell probably does not want to see a Trump presidency again.
Market Value of Portfolio
Here is a history of my portfolio value. As you can see, it’s moved in line with the markets as should be the case since most of my holdings are in ETFs that track the S&P 500 and the Nasdaq.
In total, my portfolio is sitting somewhere around $1.95m which also includes cash and fixed income positions.
Trades executed for the month of August 2024
August was an active month for trading. As markets hit all time highs, I sold many covered calls on existing stocks that I owned.
Buying stocks on the dip
As markets dipped in August 2024, I bought the whole way down. Semi conductors dropped almost 25% in the matter of a few days which is just insanity. I knew that even if the markets dipped further which was a real possibility, statistically speaking it was a good time to buy as it hit a bear market so fast.
I bought VGT hand over fist at various price ranges. I accumulated almost 100 new shares of VGT between the prices of $520 and $560.
I also sold two VGT puts with Aug 23 expiry when the price was in the $520s very near the money. Due to the increased implied vols and high delta, I pocketed almost $1.5k per contract. Ultimately, these contracts were not triggered since the markets rallied back so fast. But that is a nice profit of $3k that I will take.
Time to sell Tesla?
I’ve held Tesla since the early days of the Pandemic and acquired my 200 shares of Tesla at a post split price of about $100. I was all about Tesla and still think they have potential but I think the hype has died down.
I was recently in China and was blown away by the EV adoption rates and the sheer number of EV companies in the country. There are at least 10 different companies making EVs, most of which I’ve not heard before. However, I learned that EVs already make up more than half of the car market in China and they are obtainable by almost anyone due to their lower price point. Someone making a respectable salary of $3k USD a month can afford a new BYD car without issue. In addition, BYD has already set up factories in Thailand and will produce cheap EVs for the SE Asian market.
This is of course a silly reason to sell Tesla but this is not the only reason. In addition to rapidly growing competition in China which is a serious issue, Tesla financials have mostly disappointed for the last few quarters and I think it’s a matter of time before investors stop giving Tesla the ultra unicorn status it’s enjoyed for many years.
The main thing that will juice Tesla to the moon in the future might be its robotaxi business but that is still some time to go. I’ve held on to Telsa for awhile now, and could have sold at much larger profits but never chose to do so. I’ve sold many covered calls on Tesla over the past two years that have generated many thousands of dollars so it has done well for me. I think whenever Tesla pumps again in the future, I will sell it, hopefully around the $250 level with a juicy at the money covered call.
Summary of stock and ETF purchases
Dividend Income
For August, I collected a total of around $300 in dividends. Most of my dividends pay out in March, June, September, and December. I typically reinvest my dividends which has served me well during the market downturn of the last year or two. I’ve thought about stopping the reinvestment of dividends due to high prices so I can save a large cash reserve for the next crash but I haven’t gotten around to it.
Portfolio withdrawals and expenses
Withdrawals from my portfolio is an important part of the financial independence ethos. The 4% withdrawal rate rule is one of the main concepts of the FIRE movement which I try to adhere to. Generally, I prefer to sell from my portfolio when markets are near or at all time highs to capture, and only when I actually need the cash.
For the month of August 2024, I was all over Bali again just living the Bali lifestyle. Life in Canggu is probably one of my favorites around the world and I’ve lived in many different places. The cost of living in Bali is quite cheap so there definitely doesn’t need to be much in the way of portfolio withdrawals which is nice.
I made no withdrawals from the portfolio as I had enough cash coming in from my blog as well as leftover cash from other sources. My blog generates money every month to the tune of $3-4k and I cover exactly how I earn money from blogging in other posts.
My August 2024 Blog Earnings
I always give a run down on my monthly blogging income on these monthly portfolio reports because this is about my blog after all. My blog generates quite a lot of money from many years of hard work that it is a huge supplement to my FIRE portfolio.
In May, I switched over to Mediavine from Ezoic for my ad monetization. Mediavine has literally been a revelation for my blogging experience and it’s a complete game changer. My earnings have gone up almost 50% as soon as switching to Ezoic which has really turbocharged my blog earnings.
In addition to Mediavine advertisements, I also earn money from Affiliate programs, sponsorships, and travel planning. More details on these things in my how to make money blogging posts. Here is a breakdown of my monthly earnings.
As you see, I earned $8,000 this month in blogging which is probably my all time high. At this rate, I can feasibly earn something like $70-80k a year from blogging which would be an incredible achievement. This money is all cash net income and isj more than enough to support even a family in most parts of the world
Hopefully Google doesn’t completely ruin this with algorithm updates!
