My Personal Finance Journey

Personal finance observation, musing and decisions in a journey toward financial independence by 2020 with at least $3 million.


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Monthly Update - September 2010 ($1,067,889, +$47,223)

Contributed by mm | October 5, 2010 8:07 PM PST

6398-networth.jpgOur net worth took a great leap forward in September, thanks to the bull run in the stock market and a lower-than-expected tax on my annual cash bonus. With the September monthly gain of over $47k, the largest in three years, we have grown our assets by almost $100,000 since the beginning of the year.

We are maintaining a cautious stance in managing our investments, parking almost 60% of our portfolio in safest money market accounts or alike that yield between 1% and 2%. Of course, this is not an offensive strategy, and certainly means some missed opportunity in the recent bullish market environment, but it also gives us many good nights of sleep. With so many clouds over the world economic, we are not seeing a clear risk worth taking at the moment.

After all, we probably didn't miss a lot -- the stock market ended the September at the level where it started the year, but those with a committed stock holding probably had a rollercoaster ride so far.

6412-networth.jpg

Notes:

1) With the declined yield in intermediate and long-term bonds, we are seeing a deteriorating risk/reward profile for fixed income investment. Hence, we sold a large chunk of our TIPS holding at VIPSX in September, hence the decline in USD fixed income category and the increase in USD-denominated cash.

2) I have received the annual cash bonus. Even though we accrued the after-tax amount of the bonus in the "Receivable" line last month, the actual after-tax payout is higher than we expected, resulted in an imbalanced decrease in Receivable line and increase in the CNY cash line.

3) I'm getting extremely busy with my day-time job lately, as I'm taking an ownership to launch a new brand in a larger market in November. I cannot wait for it to pass and enjoy our scheduled Christmas vacation in Guam.

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Orange Commented on October 5, 2010

I have followed your post even since it had been mentioned in "businessweek"???.

You did a very good job at such a young age. However, i noted you has never meniotned your thoughts on the real estate market. If you bought a house in shanghai couple years ago, the number would be much better.


ynwestor Commented on October 6, 2010

4,6 % M/M change... it is really, really good profit. Congrats!


Jay Kuriakose Commented on October 6, 2010

I am always curious as to what portion of your reported gain is from an increase in contribution vs. true investment gain. Would be great if that were presented or tracked. If the bulk of your YTD gain are infact from your savings - that is great but it might be reflecting an underlying performance issue on your earning assets. After all your goal is to be able to have your money work for you and not the only the way.


SR Commented on October 8, 2010

I agree with Jay. For example, if you take out bonus and income out of August, what was the actual performance (since the market was mostly down in that month).


MM Commented on October 10, 2010

Good question. My YTD investment gain is about $36k. Not market beating for sure, but still reasonable considering my conservative stance.


UHNW Commented on October 31, 2010

Hi

I've been following your progress for a couple of years now on and off. One thing I want to know is why you have FX exposure to the USD and CNY? Seems a odd combination (unless you work there are a Chinese national).
Thanks


MM Commented on November 1, 2010

UHNW, yes, I'm a U.S. permanent resident current working in China. This makes the financial planning double the pain and double the fun :-)



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