factornerd

2020 retrospective and new year's resolutions

2021 has come and I try again to make plans. Last year I said that God laughs when men make plans, and I didn’t know how right I was. I wouldn’t call these new year’s resolutions, as this is how I called them last year, and half of them I just ignored. It will be a simple retrospective and plans for a new year.

Published:  Sunday, 03 January 2021
Author:  Daniel

How was my 2020?

To be honest, it could have been better. I’d give the pandemic a rating of 1 out of 5 and wouldn’t recommend it to anyone. However, when I draw the line, there were still a few things I should be grateful for in the past year.

Unlike many others, I still have a job, and the pandemic didn’t hit me economically. Even more, I’ve spent less and saved more because I couldn’t go out or do any traveling last year.

My investment plans were messed up and all my p2p lending and real estate crowdfunding portfolios suffered. However, I gained a lot more than I lost on the stock market.

I was supposed to have a (relatively) big wedding in May last year. Thanks to the pandemic, it got delayed and had a much smaller and manageable wedding in September. As a bonus, we’re expecting a little Daniel (or Danielle) in 7 months.

For half a year, I didn’t write anything on this blog, as I felt I didn’t have anything to say. It gave me time to invest more in stocks, to distance from p2p lending and look at it objectively, to check what’s the buzz on Defi apps, crypto, and in general research stuff I like without the need to cover all angles and writing about it.

It gave me time to build my own WordPress theme, then drop it and move my website to a new platform where I have more control over code and I can experiment more, mainly the things I was mostly interested in when I started to build my own site.

Plans for 2021

I’ll try again to split my plans into:

I’m pretty sure I’ll feel ashamed again when I’ll look at them next year.

Savings and investments

I’ve started this year to create a few bank deposits, after many years I didn’t have any. As an emergency fund for bigger purchases I might need to do in the future. It’s still a work in progress, as my emergency funds are currently worth 1,500 EUR, a bit small for any serious emergency.

Giving my current savings rate, I’ll have around 30,000 EUR in 2020 which I’ll need to spread across my investments.

Besides my flimsy emergency fund, I’ll keep investing in the following:

P2P lending portfolio

I’ve started 2020 with 25,000 EUR in my p2p lending portfolio. My plans were big, and I was expecting to grow my portfolio to 35,000 EUR by the end of the year.

Instead, this happened:

I ended the year with around 27,000 EUR in my portfolio and with 500 EUR less in earnings than at the start of the year.

I’m expecting to lose another 2000 EUR when Grupeer will file for insolvency. Maybe another 2-3000 EUR from Crowdestor, Wisefund, Viventor, and Fast Invest, if they finally decide they had enough and close shop.

2020 taught me not to put too much hope in p2p lending. Lack of regulation, unethical companies, insufficient transparency, poor response in front of crises, were all good reasons for me to not invest much more in this asset class.

I’ll keep a handful of platforms in my portfolio:

Except for Flender and Trine, I’ve also bought shares in these companies during their crowdfunding campaigns on Seedrs and Crowdcube.

Real estate crowdfunding

I’ve managed to get around -250 EUR in earnings in 2020. The UK platforms in my portfolio were hit the hardest.

Property Partner decided not to pay any rent for half a year and to add a monthly fee on all accounts. I decided to move out, at a total loss of 150 GBP.

British Pearl decided to pivot and close shop for retail investors. Their estimated value of my portfolio is around 250 GBP less than my invested value. Although I still need to wait for them to find buyers for the properties they manage before I can free up my funds and invest them somewhere else.

Yielders was the only UK platform that performed extremely well during the pandemic, and I’ll continue to invest here.

I plan to drop my investments in Housers and Reinvest24. Housers is an almost complete waste of time, with returns too low to even bother. Reinvest24 didn’t manage to convince me it’s a serious platform, and I can’t in good conscience to invest more than the 300 EUR I currently have invested there.

I liked Brickstarter, although 2020 wasn’t a good year for a platform focused on Airbnb rentals. Maybe 2021 will be better for them.

So, I’m planning to stay with these 2 platforms in the future:

Equity crowdfunding

At the beginning of 2020, I had around 8000 EUR invested in startups, splits between Seedrs and Crowdcube. I was planning to reduce my investments here, and only add 2000 EUR to my portfolio.

Instead, at the end of 2020, my portfolio is worth a bit over 20,000 EUR. A large part of my investment funds in 2020 went to this sector.

I’ve made tens of investments last year, among them being: Freetrade, Chip, WiseAlpha, Mintos, Assetz Capital, EstateGuru, CapitalRise, Pynk, Plum, Bux, AxiaFunder, Dozens, RiverSimple.

More than half of my portfolio is invested in finance & payments companies, with a few others split between electric cars, meat substitutes, and craft beer companies.

For this year, I’m also planning to invest less here, and I really hope I can stay away from this sector.

Corporate bonds

I’ve started the year with around 3000 EUR invested in WiseAlpha and planned to reach 5000 EUR at the end of the year.

Target achieved, although not all went according to plan.

I was also planning to invest more in EUR bonds, but WiseAlpha’s offer is too limited to even try. I decided around December to withdraw around 2000 EUR from the platform and invest them somewhere else.

I’ll keep investing in GBP bonds, and stay away from the others.

I also went through the first bankruptcy here. The 300 EUR I had invested in Travelex bonds transformed after debt restructuring into 80 GBP.

No love lost, as the returns from WiseAlpha are still pretty good, and I’ll continue to invest here.

Stock market

2020 was a good year on the stock market. After the crash in February, I continued to do what I do best, which was buy more. And it paid out.

In June I started to invest in the Romanian stock market. I’ve spent a few days researching the largest companies listed on the market, then invested around 6000 EUR (30,000 RON) split between 20 of them. Each month, around 600 EUR out of my paycheck goes into this trading account, and I’ll keep doing that until it reaches a decent value, at least 50,000 EUR.

At the end of the year, the total return was 13.63%, with an annualized return of 26.25%. Not bad for a first year.

In November, Degiro decided to tell me I need to close my account, as I don’t live in a country they support. It was a shit move on their part, as I live in the same country I was when I created my account and they approved it. They gave me until the end of the year to move my funds or to transfer my assets to another broker. I’ve decided to sell all my assets and start fresh on Trading212. It prompted Bunq to ask me for some proof of funds, as they’ve never seen so much money in my bank account.

Leaving aside the bad breakup, my Degiro investments weren’t too bad. In the 2 years I’ve been invested there, my annual return was 28.5%. Much better than what p2p lending offers.

I’ve dabbled with the Revolut brokerage account for a while but decided after a few months that I’d be better using a real broker.

I’ve also been investing for the past 2 years in a managed fund from a UK company named Strowz (formerly known as Marketsflow). I’ve been adding almost every month 100 GBP to my account, and let it grow at a rate of around 10% per year. Unfortunately, Strowz decided they need bigger investors, and the minimum deposit starting 2021 would be 1000 GBP, a bit too much for me. I decided I’ll withdraw all my funds from Strowz and invest them somewhere where I can control what amounts I’m willing to invest monthly.

Crypto – play money

I had around 2000 USD worth of crypto split between 2 accounts at the beginning of the year. At the end of the summer I’ve started to play around with it:

My crypto funds are worth now 4000 USD, so I’m better off than at the beginning of the year. If I just left those funds sitting there and did nothing, they’d be worth 6000 USD by now. Lessons learned: none.

Personal plans

Last year I was planning these

This year I’ll keep some of last year’s, but adapt them a bit:

Professional plans

2020 made me feel disconnected from my job. All the plans went to dust when the pandemic hit. My usual daily routine could be summed up in 3 steps: desk-couch-bed. I’d start working in the morning, and then I’d spend most of the evening on the couch, and then later at night move to my bed for sleep. And then again the next day, and the next one, and so on. It’s hard to keep yourself motivated when most of the days look the same.

I don’t have big plans for 2021, I just want to regain the joy in my work. Everything else would be easy afterward.

2019 retrospective and new year’s resolutions

These were my 2020 resolutions. I’ll get back to them a few months later, and see how much progress (if any) I’ve made. Would be interesting to hear about your new year’s resolutions. If you’re like me and you don’t keep up with them, I’m sure they all sound great.

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My investment portfolio and 8 levels of risk

I did some analysis a few days ago on how my investments are spread and if they’re diversified enough. The way I see it, all my investment portfolio could be split into items belonging to 8 different levels of risk.

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Investing in startups – equity crowdfunding risks and returns – preliminary results after 2 years

In June 2018 I made my first investment in a startup. I’ve joined Crowdcube with big hopes and invested 50 GBP in Graphene Composites, a small UK company building all sorts of products based on, you guessed it, graphene. Since then, I’ve invested more than 20,000 EUR in more than 200 European startups, hoping one day I’ll win big, get rich, and live happily ever after.

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