Freedom Fund Update – November 2011

Well, the time has come to update the Freedom Fund once again as we start another month. The Freedom Fund is my portfolio, and I think it’s aptly named. My portfolio is my way to freedom; freedom from working at a job I don’t enjoy to purchase goods I don’t need to impress neighbors I don’t care about.

The S&P 500 is up 10.77% over the last 30 days, but today’s precipitous drop of 2.47% put a damper on the recent rally the market has been experiencing. This also put a damper on the total value of my Freedom Fund. That’s perfectly ok with me, and I actually hope the market continues to fall back a bit. I think things were getting a little heady when the Dow Jones Industrial Average eclipsed 12,000 points recently and I think the market is getting a little ahead of itself on the overall excitement and anticipation of a debt deal in the Eurozone.

I made a few changes to the Freedom Fund over the last month. In October, I sold my holdings with Harleysville Group Inc. (HGIC) after it was announced they were being acquired by Nationwide Insurance. I reinvested those funds into holdings with Aflac Incorporated (AFL), Philip Morris International Inc. (PM) and ConcoPhillips (COP). A short time after those purchases, I also invested fresh capital into Harris Corporation (HRS) and PepsiCo, Inc. (PEP). All in all, it was my busiest month of investing in a long time, and I rarely have this much action in my portfolio. I plan on things being much more quiet over the next few months.

The current market value of the Freedom Fund stands at $47,169.26. This is a very large increase since the last published amount of $40,298.47. This large change in value came from not only my purchases but also the large upswing in the overall market.

I’m still invested in 18 positions. This is unchanged from last month. I sold out of a position in HGIC, but initiated a new position in HRS.

Overall, I’m very excited to post this update. I’m really starting to see the progress take form. On my last Freedom Fund update last month I was excited to finally pass the $40k mark and I’m hoping that I’ll be able to pass the $50k milestone before the end of the year. That would be far ahead of where I thought I’d be by the end of 2011. I feel blessed!

I just wanted to say thank you to all of the supporters of Dividend Mantra. The people who read, comment and share make the time I spend keeping this site updated all worth it! Thank you so much.

How are your investments doing?

Full Disclosure: Long AFL, COP, PM, HRS, PEP.

Thanks for reading.

Similar Posts

9 Comments

  1. Hi Mantra,

    Thank you very much for your nice words, you sre doing a superb job, please keep it doing!

    Speaking about my portfolio, It is too much biased towards SANTANDER, so it’s all one step foward, three backward, it is so funny that I’m dripping.

    Speaking on other things, an our particular issue about TEF, recently I read there’s a report from Merrill Lynch called “Telefonica, High Dividend Risk Also In 2012”. I think the titel says all. I haven’t had access to this report, maybe you or another reader can get it. It seems ML exposes that TEF, like many other companies in the Eurostoxx, is paying its dividend through new debt emissions.

    Stay in touch

    Very truly,
    Manefla

  2. Manefla,

    Thank you for your encouragement and support. It really means a lot.

    Santander has been very volatile lately. Not only do you have the large European exposure there, but also the exposure to the financial market. That’s a bit of a double whammy unfortunately. Just remember, we’re investing for the long-term (30 years+ for me), so this is all just short-term noise.

    On TEF I’m a bit mixed. If I could go back in time I’d probably still have a position with TEF, but it might be smaller and at a lower cost basis. My biggest problem with TEF is that I pulled the trigger at a higher price point than I should have, and that’s my fault…not Telefonica’s. Their dividend is secure for now, but the shaky global market will rattle this company just like many others. We’ll see what 2012 brings. I still think it’s a solid long-term telecom play, but they need to get their debt under control (even at the sacrifice of dividend growth).

    Best wishes!

  3. I’ve been slowly buying in to Santander over the last year, I think it’s a very underrated global banking stock due to the Spanish base of operations, but if you look at their overall exposure, along with their most recently quarterly report, it’s clear that they are in a healthier position than their share price credits them with. I wanted to correct a misconception on Santander which you echo here, regarding European exposure.

    Latin America, and Brazil, along with US arm Sovereign, account for a good chunk of their profit (Brazil is 25%, Latin America 20%, and US arm Sovereign is 5%). Less than 30% of their profit comes from continental Europe (and more importantly, less than 15% in Spain and Portugal). If you want to include the UK in there it bumps it up, as the UK represents 18% of their profit, but they are in a healthier position than the rest of continental Europe, not being tied to the Euro. They are priced as a European risk bank when only 30% or so of their profit is risk based European, and Poland can’t really be included in that as a negative.

    My only regret on Santander is having bought so much of it when it was over $10, but really, I think given time it will get back to fair value, which is north of $15. May take a few years, but in the meantime, the juicy dividend sure helps.

  4. Neu Grufti,

    Thanks for adding that. Great information on Santander.

    I should have corrected myself, or at least made myself a little more clear. I didn’t necessarily mean exposure to the European market as in sources of revenue, I meant exposure to the European markets, which have been very volatile lately.

    I made a similar mistake to you, in buying TEF at richer valuations than it’s trading for right now. I didn’t see the storm overseas coming, and made a poor choice. Hindsight is 20/20. I did average down, but wish I would have spaced my purchases out a bit more. Like you, the juicy dividend is helping to cushion the unrealized losses.

    Thanks for stopping by! I appreciate the comment.

  5. Henry,

    Thanks so much for the support. I’m lucky to have had some success and also lucky to have steady employment/pay with which to feed the portfolio.

    I hope to continue to grow it and initiate positions in some of the companies you currently own.

    Best wishes!

  6. Every time you update the portfolio, it keeps looking better and better. Keep up the great work mantra!

  7. Hi Mantra!

    Thanks for a great blog. I have the same goal and the same vision as you. Currently, we also have around the same amount in our portfolios. I am looking forward to keep follow you.

    Andy

  8. Andy,

    Thanks for stopping by. I appreciate your support and encouragement. That makes it all worthwhile for me.

    That’s great to hear that we share the same vision! You mention we have similar portfolio values, do you also have a lot of the same companies? Anything on your radar? I’m starting to branch into higher growth/lower entry yield opportunities due to my age. On the other hand, my retirement age is much younger than others’ in my age group so that’s something to keep an eye on as well.

    Best wishes and keep in touch!

Leave a Reply