Hercules Capital Azione Forum

Hello everyone,

today there is a long announced #offtopic from me.

It's about the question of what the planned reinvestment of my distributions is that I mentioned (especially in the reviews).

I want passive cash flow! I want the money to rain down from the sky, fully automated! And this money should also find its way back to the stock market fully automatically. Simply to keep feeding the passive income stream so that it gets bigger and stronger. This should work until one day I use the distributions to cover my living costs.

But how do I go about it?

In order to know how much I can reinvest each month at best, I first need to record all my incoming distributions, from which I can then calculate an average value for all monthly distributions per month. I compare this value with the previous year's values. This comparison enables me to obtain the increase in my income and thus estimate it for the new calendar year. The monthly return figure estimated here for the following calendar year is my planned reinvestment figure.

As I said before, I want to set up a fully automated system with the reinvestment that runs by itself. This also means that manual intervention on my part should not be necessary, although there may be exceptions.

So the question is: when do I actually have to intervene in the automated reinvestment of my distributions myself? Of course, this is only the case if the actual distributions received from my investments in a month are lower than the planned amount of my reinvestment. And for this scenario, I have two aces up my sleeve to avoid having to intervene after all. On the one hand, I leave distributions from particularly high-yield months for the weaker months so that the process can continue. If these reserves are not sufficient, I have a second ace up my sleeve. My current employer gives me half of the Germany ticket tax-free. I haven't included this bonus in my personal budget planning. This means that the money is not intended to cover expenses. So if there isn't enough available for the planned reinvestment, I'll use this allowance for that. And in the event that the allowance cannot be used, it goes into a provision for reinvestment.

The system I use is not complicated and has fortunately already proven itself in practice. Looking back on the first three quarters of 2024, my distributions were always large enough for everything to work fully automatically, except in January and February. For the two months affected, I was able to keep the engine running thanks to the provision. It's running like clockwork. Things are also looking good for October. So not only is the system running, I could even have planned more optimistically.

The follow-up question is certainly: how do I use my reinvestments, or more precisely: what do I invest my distributions in? There are two strategies that I pursue. On the one hand, I use the distributions to strengthen the savings plans from the net salary of my smaller-volume positions so that the positions can build up more quickly. On the other hand, I use some of the reinvestments to finance entire savings plans that I don't have to use my net salary for. This is the case for me, for example, with oil stocks such as $XOM (+0,74%) and $CVX (+0,94%) but also with others such as $DLR (+1,27%) and $GSK is the case.

Conclusion: The system works as described and is simple. I only have to check a few days before executing the savings plans to see whether the clearing accounts are sufficiently filled. I can even increase the size of the planned reinvestments for the following year, which makes me very happy. $UPS (-0,58%) and $HTGC (+0,27%) will be included in the savings plans, starting this December. The snowball of passive income is thus getting bigger and bigger, making me increasingly free from active earned income. That makes me happy! I couldn't have imagined something like this at the zero hour of my wealth accumulation.

Profits from the last trades reinvested via savings plan

Part 2

As some of you may know, a few weeks ago I started the battle to reduce my portfolio from 77 positions to 25-35.

At first it was quite easy to find stocks that I no longer wanted, but gradually it has become more and more difficult. In the meantime, I have already sold quality companies 🤦‍♀️ and often toyed with the idea of keeping the rest.

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However, in my opinion this would be a mistake, as there are still many positions in my portfolio that do not fit in with a growth strategy.

So today, I have added the obvious dividend stocks and placed an SL order on each of them.

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I proceeded as follows:

Agree Realty $ADC (+3,68%) SL set at 59,70€

National Retail $NNN (+3,7%) 40,-€

Hercules $HTGC (+0,27%) 16,07 €

Omega $OHI (+2,74%) 29,14€

Bats $BATS (+0,49%) 30,00€

Ares Cap. $ARCC (+1,62%) 17,- €

Main Street Cap. $MAIN (+0,69%) 43,43€

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I am open to suggestions for improvement and comments 🧘

The trees are putting on their golden-yellow dress, it's getting rainy again and the temperatures are dropping. The golden fall is just around the corner. I take advantage of the cold by only taking cold showers and prepare myself for winter ice bathing. Over the next few days, I'll be swimming in cold water, avoiding hot showers like the plague. Meanwhile, the depot is running. Time for a look back.

I present the following points for the past month of September 2024:

➡️ SHARES

➡️ ETFS

➡️ DISTRIBUTIONS

➡️ CASHBACK

➡️ AFTER-PURCHASES

➡️ P2P CREDITS

➡️ CRYPTO

➡️ WHAT IS REALLY IMPORTANT

➡️ OUTLOOK

➡️ Shares

After the top of the class $AVGO (+1,15%) has deflated, it is now shifting up a few gears again. The +121% performance of $AVGO (+1,15%) increased to +178% last month. There is still some way to go to +200%, but perhaps I will soon have the first trebler in my portfolio. That puts me in a good mood! The heavyweight, which also accounts for the largest volume among the individual stocks in my share portfolio, is attracting other heavyweights such as $WMT (+1,81%) and $NFLX (+0,37%) behind it. The last few months have also seen $SAP (-0,4%) steadily risen in my portfolio and has now already reached 4th place, accompanied by $AAPL (+0,65%) . The former leader $NOVO B (+0,73%) continues to fall but is still performing well. There are also other stocks that are fighting their way up that I did not expect at the time. For example one $ABBV (+1,03%) or $BAC (+1,3%) .

If I look at the performance, I am also spoiled with great results behind the winner. $NFLX (+0,37%) shines with +98%, $NOVO B (+0,73%) with +74% and $SAP (-0,4%) with +72%. When I added the stocks to my portfolio, I would never have imagined that there would be any stocks in my gold box that could double. I'll probably have several of them next year.

And I'm not worried about the basement floor either, as the negative performances are constantly moving towards zero. Step by step. There was also a change in the order at the lower end due to additional purchases. My smallest positions by volume are now $CP (-1,37%) , $DHL (+0,1%) and $OR (-2,66%) in terms of performance they remain $NKE (+0,58%) , $DHR (+0,53%) and $CVX (+0,94%) o.

➡️ ETFs

My beloved core retirement savings unit is growing and growing. The biggest chunk, the $VWRL (+0,46%) already accounts for 13.4% of my entire securities portfolio. All I can say here is: stubbornly and steadily save a portion of your net salary every month in the boring bread-and-butter ETFs by standing order and savings plans, then you can successfully escape the monster of old-age poverty. In my opinion, everyone should do this. I'm a fan of distributions because they provide a steady additional income. And by saving continuously, this income increases. I also promote this in my private circle. I think it's a shame that so many people respond to my efforts to raise awareness with "Yes, but ...". By constantly hiding behind excuses that are always the same, people are driving themselves into poverty in old age. Even worse are those who think shares (or securities in general) are the devil's plaything and moan about pensions. On the one hand, they don't understand how the pay-as-you-go system really works, and on the other, they completely lack basic financial education. They think they are throwing money into a certain pot from which they can later withdraw. Interestingly, this is only the case with their own portfolio, not with the state pension.

In addition to broadly diversified standard ETFs, I like to put unplanned inflows into dividend ETFs. I want cash flow that will one day cover my living expenses.

➡️ Dividends

I received 33 distributions on 14 payout days in September. I am grateful for this additional income stream.

Unfortunately, I didn't manage to write the extra article I announced in my last post about how I deal with reinvestments last month. This is planned for this month. My plans $UPS (-0,58%) and $HTGC (+0,27%) into the savings plans remains in place. I already teased this in the last review.

➡️ Cashback

In September, I received a €40 voucher for scanning my daily purchases, which I used to buy overhead headphones that had been on my watchlist for a while. In line with my cashback procedure, I deducted the equivalent value of the voucher in euros from the corresponding provision and transferred it to the exchange. In this way, I use the benefit of the voucher as productive capital instead of just consuming more like others. My budgets for wear and tear and provisions are thus adhered to and the benefit indirectly finances my asset accumulation.

➡️ Subsequent purchases

Thanks to a small bonus, reimbursements from health insurance and supplementary dental insurance and the aforementioned voucher, I was able to make several additional purchases last month. These include the additional purchase of 2 $UPS (-0,58%) and 6 $HTGC (+0,27%) shares as individual additional purchases. I am convinced by both companies. I also invested €27 in the one-off savings plans $SPYD (+0,91%) , €49 in the $TDIV (-0,67%) and €44 in the $FGEQ (+0,37%) invested. Simply to increase the cash flow from the investments. Bit by bit, the tap is being turned on further and further.

➡️ P2P loans

Over a long period of time, I have managed to reduce the amount of defaulted loans on my remaining platforms to a double or single-digit sum. All the rest has been withdrawn. Of course, no progress has been made with interest or redemption payments. I wish the operators would simply write off the rest without replacement so that I could ditch all the platforms. Bondora Go & Grow is an exception to this rule. This is running smoothly, but I'm not putting any new funds into it, I'm just letting it run.

➡️ Crypto

I'm not currently doing anything here. I advise everyone to study the debt cycle and the crypto cycle in order to understand price movements in the long term.

➡️ What is really important

I was on vacation at the end of the month into October, so I spent time with my ex's kids, whose social father I was allowed to be one. First I spent several days with the kids and my ex. I went out in the evenings with the older teenage girl, mainly to give her the attention she was looking for so that she could be the focus of attention herself. In October, we spontaneously went to the capital for a few days at the child's request. This kind of time together with all the experiences helps to strengthen and rebuild the bond, which has of course suffered in recent years, for example due to physical separation. There have been so many great moments over the years, both in the province and in the big city. Enjoying the peace and quiet in the evenings with a great view, listening to what moves her and then the trip to the metropolis with its light and dark sides. And so much more.

Why am I writing this? Because it's moments like these that make life worth living and give us strength in dark times. This is even more valuable than our beloved topics of finance and investment.

➡️ Outlook

The year-end spurt begins very soon. I am hoping for price magic like last year. But the crypto cycle will be even more exciting, as we expect prices to skyrocket at the turn of the year.

Left:

Instagram profile with review: https://www.instagram.com/frugalfreisein/

Threads: https://www.threads.net/@frugalfreisein

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Good evening everyone,

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

$KMB (+1,82%) 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 (+2,17%) Out with around 6.5 % and the reasons for the sale are largely the same as for Kimberly-Clark.

$MSTR (+1,77%) 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 (+0,37%) . 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 (+3,31%) Ecolab $ECL (+2,32%) and Colgate $CL (+3,18%) . 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 (+1,62%)
$MAIN (+0,69%)
$HTGC (+0,27%)

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 (+0,87%)

The remaining cash was used and the position in $OBDC (+0,43%) further expanded.

In addition to $HTGC (+0,27%) and $JEGP (+0,79%) my mainstay for cash flow.

Something else #beerchallenge from the really beautiful Vilnius.

Summer has bid farewell with fantastic weather. I made the most of the hot days last month to swim after work or at the weekend. While I worked steadily on my fitness for crawling and diving, my investments continued to work hard for me and brought me the fourth highest monthly dividend of the year, just behind the previous month. A very good performance for a month that is known for less passive cash flow. Time for a look back.

I present the following points for the past month of August 2024:

➡️ SHARES

➡️ ETFS

➡️ DISTRIBUTIONS

➡️ CASHBACK

➡️ AFTER-PURCHASES

➡️ P2P CREDITS

➡️ CRYPTO

➡️ COST REDUCTION AND EVEN MORE INTEREST

➡️ OUTLOOK

➡️ Shares

My class leader$AVGO continues to let out some air. Perhaps this is because I am constantly increasing my weighted buy-in through the savings plan. So the $AVGO only +121% in the books. The heavyweight is accompanied in the portfolio volume by $WMT and $NFLX (+0,37%) accompanied.$NOVO B (+0,73%) The stock dropped a few ranks, but $SAP (-0,4%) and $ABBV (+1,03%) in front of the podium. The depot breathes like a living organism. This can be seen from the fact that$NFLX (+0,37%) i with a performance of +88% and $NOVO B (+0,73%) with a slight gain of just under +101%.

Due to a lack of significant changes, I am leaving out my smallest positions this time. Only the minus is steadily going back to zero and thus becoming "smaller".

➡️ ETFs

Compared to other techniques, breaststroke requires less effort and you can cover long distances without having to stop. It is similar with my beloved ETFs. We need to invest very little attention in the broadly diversified bread and butter ETFs (and decent dividend ETFs) to get an average (but still good!) output. That's why I keep preaching about this tool. It's simply something everyone should have in order to build wealth. It's so easy to make provisions, for example, as I did with a $VWRL (+0,46%) . The largest position in my portfolio accounted for 13.1% of the total portfolio and is self-regulating in terms of its composition. This means that the vehicle does not require any real maintenance. Simply save stubbornly and steadily every month and then pursue other enjoyable activities that fulfill life. For example, swimming, running or hiking.

➡️ Distributions

I received 20 distributions on 11 payout days in August. I am grateful for this additional income stream.

As mentioned in the last update, I have taken a closer look at the development of the dividend and decided to increase the size of my reinvestments from dividends. $UPS (-0,58%) and $HTGC (+0,27%) will be included in the savings plans, probably from this December. This is also an indication that the monthly income stream is growing reliably. I only want to look at the coming weaker months of October and November in order to be able to calculate fully and reliably for the coming year. After all, I want the system to be completely self-sustaining. I will publish a separate article in September on how my reinvestment works and how the Deutschlandticket and my employer are connected to it.

➡️ Cashback

I received additional cashback again in August. First, I redeemed €4 in Payback points at REWE's delivery service and, as always, transferred the equivalent amount from my grocery account to my settlement account. I also had €10 paid out from Shoop, as I finally exceeded the minimum threshold again. Lastly, I received a €25 voucher for MediaMarkt for scanning my purchases, which I used for household goods. I transferred the equivalent value from the corresponding provision for household goods to a clearing account. The investment will only be made in September, as two more refunds were still outstanding. By the time you read this, the cashback has of course already been reinvested. It's great when others also help to build up my retirement provision/assets and increase my passive income.

➡️ Subsequent purchases

Many of you saw this great buying opportunity in the first days of August, even if the background was of a sad nature. I would like to congratulate you on your snap-up, as I was unable to add to my position due to a lack of cash at the time.

Only a dividend not reinvested in July, which was still in a clearing account, found its way into the stock market with the subsequent purchase of a small $FGEQ (+0,37%) on the stock exchange.

➡️ P2P loans

Nothing new in the West back then, nothing new in my defaulted and recovering P2P loans, they say today.

I wish for the day when I finally get rid of this asset class, my forecast is up to 4 years.

➡️ Crypto

I am simply not doing anything here at the moment. I'm also not buying any more in order to be out of the holding period with all coins at the planned sale at the turn of the year. The only exception will be Solana. What I am investing the proceeds in is roughly known, as is my subsequent procedure for rebuilding my holdings. I advise everyone to familiarize themselves with the debt cycle and the crypto cycle in order to understand price movements in the long term.

➡️ Cost reduction and even more interest

One of my banks (N26) announced last month that it was cutting its interest rate. The reduction is so drastic that the payment model was no longer justifiable for me.

So I decided to give notice to this bank, where I had my provisions and my food account in Pockets, and look for a replacement. From a video test by a small but very friendly financial youtuber from my area, I took a look at C24 Bank, found it to be good and set up my account infrastructure for the bank account I no longer had there in just a few minutes. I would never have imagined that it would be so easy to change my bank account. This reduces the costs of my account structure to €0 and even more sub-accounts will earn interest in future.

➡️ Outlook

As things stand, there will most likely be a half-year bonus after all. As I already want to put cash aside for future expenses, I can only use the bonus to buy one additional share. $UPS (-0,58%) buy one more share.

At the start of the year, I have set myself the goal of investing at least €15,000, and if I manage that, then €16,000 up to €16,500. I'll have the €15,000 for sure, but I won't reach the upper target. But that's not a bad thing, I always set myself higher goals. Let's see where I end up.

Left:

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Question about the dividend of $HTGC (+0,27%) at TR.

Hello folks,

I have just seen that I have received a statement for the dividend from Hercules Capital at TR. Payday was 20.06., I received it on 21.08. without a push (unusual). So far so good.

The ex-date according to Investor Relations was 13.08.

I had already bought another 15 shares on 07.08., which were therefore in my securities account on the record date (value date according to the purchase statement: 09.08.).

TR has now simply forgotten these 15 shares. I therefore did not receive the dividend on my full shares, but on 15 shares less.

My question: Can you check your Hercules statement to see if it is correct?

I have already written to TR (and will post updates here), but I would like to know whether I am alone in this or whether it affects others too. Because I assume that the first message from TR will come from the chatbot again and is therefore rather useless.

Thank you.

Edit: Dividend was automatically(?) canceled and recalculated. It fits now.