Minting The Markets
Portfolio Edition
If you are like many new [er] investors, You might be puzzled or lost as to where to start your investing journey.
What I'm about to say is what worked for me, I can in no way guarantee any results. I can however give you historical facts about the market & how I started investing years ago.
Investing takes years. This is a way of saving for the future, one of many paths to financial freedom.
My portfolio is broken into main 3 parts.
Core / Main blended portfolio
Dividend stocks
Speculative Income
Core or main portfolio investments.
The most basic & historically profitable way to invest in the market for the long term is in the S&P 500.
The top 10 companies in the SP500 are
$AAPL Apple Inc.
$MSFT Microsoft corporation
$AMZN Amazon. Com
$GOOGL Alphabet Inc.
$BRK.B Berkshire Hathaway Inc
$NVDA NVIDIA Corporation
$TSLA Tesla Inc.
$XOM Exxon Mobil
UNH UnitedHealth Group
$JNJ Johnson & Johnson
This is the top 10 of 503 in total stocks for the SP500, you can see just the top 10 are well known companies.
Owning shares in the SP500 is considered diversification alone.
The average return on the SP500 historically is 10-12% over a 20-30 year sample.
Most funds use the SP500 as the benchmark or goal to try & beat. Instead of trying to beat it, I'm just in it.
Example 1.
This means someone investing in the SP500 alone @ $500 / month over 30 years can stand to see potential portfolio growth of $1,747,480.
This is contributing 180k over a 30 years time & then seeing $1,567,480 in compounded growth not including dividends.
Example 2.
Someone contributing in the SP500 alone @ $2000 / month over 30 years can stand to see potential portfolio growth of $6,989,927
This is contributing 720k over a 30 year time & then seeing $6,269,927 in compounded growth not including dividends.
This can be all be achieved by just investing in one vehicle. The SP500 alone. I aim for 50-70% of my income to be reinvested into my portfolio.
Most recommend to invest 15% of income. But the facts are this: The longer you invest, the more time it has to work & the less you have to contribute monthly.
The less time invested in the markets means more money is needed to invest to try & catch up with time. This is why investing is about time in the markets.
There is no stock picking, trying to time tops or bottoms. Its steady dollar cost averaging over time with the SP500.
The investment vehicles of choice for the SP500 for myself are:
$FXAIX (Fidelity 500 index fund,) this is a mutual fund.
$SPY SPDR S&P500 ETF Trust
$VOO Vanguard 500 Index Fund ETF
I invest in all 3 to blend out the different fund vehicles, but primarily $FXAIX is my set it & forget it approach.
Since $FXAIX is a mutual fund. I have periodic investing & drip (dividend reinvestment ) turned on & I have it purchase a set dollar amount every Monday at market close.
The only thing I have to do is make sure I have money in that brokerage account for that upcoming automatic buy each week.
Other than that, it's a passive investment strategy for me. I simply do not have to worry about timing the market. I'm just buying the market & plan to be in it for a very long time.
Note: Getting money out of this fund ($FXAIX) takes about a day, there are no shares actively throughout the day traded like $SPY or $VOO, so if you need to liquidate, you need to put an order in & it will be filled at the end of the business day for whatever the fund closed at.
It doesn't matter which fund is chosen, It's all personal preference. I have the bulk of my portfolio in the SP500 for stability & diversification.
If anyone is looking for a simple approach to investing, I'll say keeping it simple with $SPY $VOO $FXAIX is what worked for me.
I know many people that retired only on those investments. They didn't want complex investing, they just wanted to be in the market & to profit from the market in the long term.
Some may not know this fact, but a lot of brokers offer partial or fractional shares. This can help those who can't afford to buy a full share of $VOO $SPY or $FXAIX etc. You can simply just purchase what you can afford & it breaks it down to a smaller fractional share.
You still get paid dividends, just a fractional dividend. I don't buy a certain share amount each week in $FXAIX, I buy a certain dollar amount & the broker breaks it down to however many shares it comes out to.
The next investment choices are not the SP500 alone, (like the 3 above) but they are still my core portfolio to blend / round it out.
$VTI Vanguard total stock market Index Fund ETF Some people use this as their core, I just include it in mine. It's a great stand alone investment.
$QQQ Invesco QQQ trust Nasdaq100 ETF Another core, some of the names in this are in the $VTI, $SPY, but I still blend out my portfolio with it.
$SCHD Schwab US Dividend Equity ETF, This just seeks out 100 dividend paying companies in the US. I know many that use this ETF with $VOO/$SPY Then you have the dividend blend side mixed with the SP500 component.
$VNQ Vanguard Real estate index Fund ETF, This is a blended REIT for diverse real estate holding as part of my core group. This pays decent dividends also.
For my approach, I can live off $SPY $SCHD $VTI $VNQ & be happy for life. Others may want other items. Investing is just as much as personal as it is understanding what you want to invest in. For myself, I want to be in the Historical returns of the SP500, Dividends & Real estate. This would be the $SPY/$VOO $SCHD, $VNQ This is diverse enough for my likings.
Some would ask why $SPY, $VOO or $FXAIX? How do I choose which is best for me? It's not a matter of which fund is better, it's just a matter of investing in one or all of them. I personally have the bulk of my portfolio in $FXAIX as a mutual fund. Then I have a good size in $VOO $SPY.
Yes they are all similar & virtually the same investment & returns.
It's not about fund rates, fund fees, It's about diversification. If I needed to sell some $SPY or $VOO almost instantly, any time instantly I could.
These ETFs are high in liquidity & have a wider range of trading times that they trade each day. I can get money out immediately if needed in most cases. $FXAIX I would have to wait until the order closes after hrs. All buy/sells are done then in the fund.
The other reason is fund diversification. If I put all my money in 1 fund & something happened to the fund, I'd be screwed. I prefer to have it in 3 funds of 3 companies vs 1. Personal preference only.
Dividend section
Dividend portion of my portfolio are companies I personally value, Some are dividend kings & dividend aristocrats.
Every one of them is probably well known & it's not going to be a surprise for you to see them on my list individually.
Dividend stocks may not be for everyone. I personally like them, so I don't have to sell stocks later on to live off of. I can collect dividend income instead.
I stick with quality over yield on these. After all you are putting money to work, you have to understand the company's dynamics & be comfortable for growth, payout sustainability etc.
Dividend Kings in this section only are in BOLD. The dividend kings feature stocks that have 50 years of consecutive dividend payout increases.
Dividend Aristocrats in this section only are in Italic. The Dividend Aristocrats is a company in the SP500 index that has paid, and increased, its base dividend every year for 25 consecutive years.
1.$CAT Caterpillar Inc. 1.95% 29 years of increases
2.$CL Colgate- Palmolive Co. 2.58% 60 yrs of increases
3.$CVX Chevron Corporation 3.59% 35 yrs of increases
4.$FRT Federal Realty Investment trust. 3.98% 55 yrs of increases
5.$HD Home Depot Inc 2.41%
6.$JNJ Johnson & Johnson 2.80% 61 yrs of increases
7.$KHC Kraft Heinz Co. 4.11%
8.$KMB Kimberly-Clark Corp. 3.68% 52 yrs of increases
9.$KO Coca-Cola Co 2.95% 61 yrs of increases
10.$KR Kroger's Co. 2.36%
11.$LMT Lockheed Martin Corp 2.55%
12.$O Realty income Corp. 4.50% 28 years of increases
13.$PEP PepsiCo. Inc. 2.66% dividend, 51 yrs of increases
14.$PG Procter & Gamble Co. 2.67% 67 years of increases
15.$SBUX Starbucks Corporation 2%
16.$SWK Stanley Black & Decker Inc. 3.78% 55 yrs of increases
17.$TSM Taiwan Semiconductor MFG. Co. Ltd 1.83%
18.$VZ Verizon communications Inc. 6.56%
19.$WM Waste Management Inc. 1.84%
20. $MO Altria Group Inc. 8.12%
I buy & hold these stocks. I buy them on pullbacks & just accumulate them over time. Same with the core portfolio, I have DRIP turned on & just accumulate & compound more shares.
Speculative & income
Some of the higher yield dividends tend to be more speculative in my portfolio. It's usually under 10% of its entirety, I can afford this much risk. I do understand the risks involved with these stocks. These are classified as higher risk investments to me.
$STWD Starwood Property Trust Inc 9.62%
This company's core business focuses on originating, acquiring, financing & managing commercial mortgage loans & other real estate debt. This investment pays well but does fall under the more speculative risk category for me. I only invest a portion of my portfolio I'm willing to take losses in.
$JEPI JP Morgan Equity Premium Income ETF 11.75%
JEPI Seeks to deliver monthly distributable income & equity market exposure with less volatility.
JEPI is an actively managed fund that generates income by selling options on U.S. large cap stocks.
$QYLD Global X Nasdaq 100 Covered Call ETF 13.03% This fund offers investors with potential monthly income while seeking to lower the risks of investing. The basis of this fund is to sell calls on the Nasdaq 100 index to generate additional income while holding the underlying's.
In Closing
There are many types of investors, My style is heavier on the SP500 for blended long term appreciation. Then balanced out for dividend & income. The great part about investing is you get to pick what works for you.
If I were giving advice to a younger version of myself on how to do it all over again,
I would tell myself to pick $SPY, $VOO or $FXAIX (or a combo of them all) & to make that my core focus. Invest in it each week, Set a budget, Pay myself first by investing & don't stop adding each week. Key is to start & don't stop, Even if it's $50 a week, don't stop.. Just fit it in my budget & do it, bottom line.
If I have more funds to deploy. I would add $SCHD next, then $VNQ or $VTI. This is all that I would want or need in the next 20,30,40 + years to come.
From there is all about carving out a portfolio that you like & understand. Never invest in something you can't / don't understand. This is why sticking to the SP500 is just easy for most.
I know some that have amassed a huge portfolio, myself included just with $SPY & $SCHD. This is a simple ETF combo out there that everyone should know about.
Once a core is established & maintained, it's all about if / what you want to add into the mix.
I've met many multi millionaires that just retired on $SPY $FXAIX $VOO. It doesn't need to be complex.
You just need a plan & take action.
Bonus note by request: I monitor my dividend portfolio in 1 app called Divtracker pro.
Its the screen shot I post on twitter regularly. I have several accounts & this app gives me a generalized snapshot of dividend performance overall in 1 visual. Its an ok app, its not 110% perfect or correct, but its very close for monitoring purposes. Its still best to use individual brokers for 100% accurate information.
Sources for info
ETF dot com, Ramsey solutions, Dividend dot com, Investing dot com,
All personal opinions, not investment advice, educational content only.
Disclaimer: Any information contained in this newsletter is the personal and subjective views of Minted Trading. All Opinions on stocks or options mentioned are for informational purposes only that I share publicly as my personal blog. This newsletter is not investment or trading advice, but just general information based on my personal views.
All publications are my thoughts & are based solely on my opinions only. Every reader/viewer should perform their own due diligence before investing stocks or options. Trading involves a high degree of risk & you can lose everything if you do not know what you are doing. I do not guarantee the accuracy of the information posted, or guarantee any profit of any kind. You as a reader are to assume responsibility for what you do with the information you digest online. What you do with it, is solely up to you.
Minted trading is not registered with the US Securities and Exchange Commission (“SEC”) or any state securities regulatory authority as a securities broker-dealer or investment advisor. Minted trading is not licensed to give investment advice. Minted trading does not give investment advice in any manner, So do not ask. These are solely my personal views. Contact a financial advisor if you have any investing questions.
Just came across your twitter. Absolutely tons of value! Absolutely love your inviting approach as it’s very similar to mine. Also I use the same app to track my dividends. I’m a better long term investor than trader but might start doing options since I’m in the discord.
This is an amazing article!! I have shifted my thinking to more long term investing instead of just day trading and I love the phrase "buy wealth." Thank you Minted!!