Kate (@Iwanowitsch) on getquin

1Mon·

Good evening everyone,

The first steps have been taken. I sold the following shares today:

$KMB (+1.01%) A weak underperformer that operates in a business sector with a poor stomach.

I simply don't see any significant growth opportunities here over the next few years. I'd rather put the money into my broadly diversified world ETF or other investments. I got out with just under +10 %.

$PAYX (+1.33%) Out with around 6.5 % and the reasons for the sale are largely the same as for Kimberly-Clark.

$MSTR (-12.57%) After the rapid rise of the last few weeks, this has become too risky for me. I got out after a short holding period with around 28%.

In addition, the correlation with Bitcoin is very strong. And I'd rather hold my own $BTC (+1.25%) . From another perspective, if the value of the Bitcoin held is roughly half the market capitalization and you ignore the high level of debt, I still don't know where the other half of the market capitalization comes from.

The dividend aristocrat Procter & Gamble was actually also on the hit list for today $PG (+2.05%) Ecolab $ECL (+1.09%) and Colgate $CL (+0.76%) . I'm still not 100% sure about these, hence the vote. I would like to take a closer look. I was particularly fascinated by the 12m chart for Colgate. It looks as if a child has drawn a straight line from bottom left to top right. It's similar with Ecolab, where they have made around 45% in twelve months with dividends. (With Colgate around 40 %)

What happens next? The portfolio will be further reduced/concentrated. The BDCs are high on the hit list $ARCC (+0.68%)
$MAIN (+1.2%)
$HTGC (-0.22%)

REITs, on the other hand, can stay, as they currently have strong momentum and could benefit from falling interest rates. The only one I'm not quite sure about yet and would like to take a closer look at fundamentally when the opportunity arises is $STAG (+1.32%)

Kate

@Iwanowitsch

1Mon·

Portfolio Feedback

Hey everyone,

I'm currently facing the challenge of reducing my portfolio from 77 to a maximum of 30 shares in order to get a better overview and focus my strategy. But I'm not sure how best to proceed.

Should I:

Sell the stocks that have done badly as they are obviously not performing well?
Or should I rather sell the ones that have performed best in order to take profits before things go downhill?
Or simply sell the 40 smallest positions? But there are also many interesting stocks in there that might be worth expanding.
Or simply sell everything that is heavily weighted in the MSCI World and thus reduce the cluster risk?

Perhaps there is a better approach? What do you look for when reducing your positions? Diversification, dividend yield, or simply the size of the individual positions in relation to the overall portfolio? I look forward to your opinions and tips!

Thanks in advance!

77Positions

15.75%

3 Comments

Thomas@UndNun

1Mon

Incidentally, selling positions that have only made a loss immediately or later (i.e. possibly waiting to see if they rise) is not in itself a loss. See 'loss carryforward'. At least for us small investors.
Every year you can offset losses from previous years against realized gains from the current year tax-free. Up to 20000 euros each year. But only within the same asset class. So shares with shares and ETFs with ETFs, but not one with the other.

This means that if, for example, you make a loss of 30,000 euros when you sell your shares, you can take profits of up to 20,000 euros from other shares tax-free this year and another 10,000 euros the following year.
The nice thing about this is that, according to the current legal situation, this loss carryforward continues from one year to the next. As long as the legal situation does not change, you can only start to offset your current losses against your later gains in 10 years' time.

You could therefore 'save' these shares and hope for better times. However, there is a good chance that it would be better to let the money 'work' somewhere else in the meantime.

However, there is one problem with this. Normally, your bank will do all the clearing automatically (you'll have to ask). But if you use a neobroker, there are differences. Brokers who are 'tax-simple' will also do this for you. Just like banks, they automatically pay your taxes on profits and should also handle loss carryforwards correctly.
However, if your broker is not 'tax-simple' then you should receive paperwork once a year that you have to keep yourself and settle with the tax office. You may also need / want to have a tax advisor for this.

To complicate things further:
With a tax advisor, you can do your tax return up to 3 years later. 'Savings foxes' might come up with the idea of not paying tax on their profits from this year until 3 years from now and hope to make a nice return on their currently untaxed profits for the next 3 years.

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Thomas@UndNun

1Mon

77 positions?
You could remove a good 55-60 positions and replace them with sensible ETFs or $BRK.B. Especially if you are only saving and are not dependent on distributions or sales.
Because whether you sell or pay dividends, you pay taxes on both, which you then miss out on when reinvesting.
Especially if you decide to sell an individual share because at some point it performs poorly or comparatively worse than others and you already have a useful profit, let's say 10,000 euros. Then you immediately pay 26.4 % tax, i.e. you have lost 2640 euros which, if you had found a reliable long-term ETF, would have given you perhaps another 10 or 20 years of good interest-bearing returns.

Use an ETF savings plan calculator to work out what 2640 euros would have yielded over 10, 20 or even more years.
So follow Warren Buffet and only buy what you want to hold forever.
Or (my addition) what yields a good enough return in a relatively short time (5 years?) so that you still get a significantly higher return after tax than with long-term investments.

For the same reason, some people prefer accumulating ETFs to distributing ETFs during the accumulation phase.

Incidentally, for the same reason, it is best to use large ETFs (at least 250 or even 500 million). This is because if an ETF is closed or merged (usually because it was too small or there was a company takeover at the provider) and the new ETF is located in a different country, you will receive the corresponding shares, but technically this is usually resolved by a sale, which then incurs tax. Which should of course be avoided. And with funds and ETFs with large volumes, it is unlikely that this will ever happen.

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Memos97@Memos97

1Mon

I would say that you should organize your stocks according to the GICS sectors and see which stocks you prefer the most in each sector. Kick the rest.

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