Investment Update Jan 2021 – they did it again!

If you remember, at the end of last month, I noted that the market appeared to take a small dive right at the end of the month. In January, the market dropped about $40K in the last week, leaving me from a +3.0% to a -0.5% return for the month.

In February, I checked the market on Thursday, Feb 25th in the morning, less than 36 hours before then end of the month, and I was ups over 5% for the month. Yeah, baby! By Saturday morning, however, when I went to check it, the market had dropped close to 3% again, and I was only up 2.8% for the month. Still up over $41K, but not the $70K plus that it was on Thursday. They did it again!

In talking with some folks in the community, we all agreed that it was madness to be checking the market continuously. It is s also to be noted that all these gains/losses are just paper gains/losses. Until you sell the stock/mutual funds/ETFs, its all on paper, so it doesn’t do you any good to cry over a loss or crow over a gain. Just track it and see how it does over time.

So how did I do for the month of January? Overall, pretty good.

My allocation remains pretty much the same as when I set it back in July 2020:

  • 20% Bond Index Fund
  • 20% S&P500 Index Fund
  • 20% International Index Fund
  • 20% Small Cap Index Fund
  • 20% REIT Index Fund

My 401K doesn’t have REIT option, so it’s just 25% for each.

  • Bonds were down about -1.8%
  • S&P was up 2.8%
  • International was ups 2.3%
  • Small Cap up 6.1%
  • REIT Index up 3.4%

I also have a Vanguard value fund (VVIAX) where I put in my after-tax investment money. That was up 5.0% for the month. Maybe 2021 will finally be the year value investing starts beating the growth stocks? Who knows.

My dividend account new allocation (as of Jan 2020) was:

  • 50% Dividend Stocks
  • 50% REITs

The dividend paying stocks were up an average of 1.5%, and the REITS were up an average of 3%. These specific REITs really starting paying off in February, after a couple of months of almost nothing. It will be interesting seeing them in the months ahead.

Again, wow. The dividend account has been down all year and hasn’t recovered anywhere near what the 401K/IRA accounts have. Now its come roaring back. Hopefully it will end the year in the black.

Again, my intention is not to alter my asset allocation or “get out of stocks” but I am mentally preparing myself for a very bumpy 2021.  As I stated in January, I think the market is overvalued right now. We will see.

Hope everyone is healthy and your market returns for the rest of the year go up!

Read more

Mr. 39 Months

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.