February 2020 Month-end Accounts

The image of money falling and coins hitting the floor. But the story from February is that things were bad and as of the 9th of March that floor is just a trap-door – a dead cat bounce and that cat is called Corona the virus-filled cat.

Needless to say that February was a disaster. Net worth down 4.1% or about £40,000 and it’s set us back a few months in terms of our progress to Financial Independence. That’s fine. These things happen and compared to a year ago we have more money (March is looking less certain though).

I’ve not really been too worried. Just a bit disappointed that this has happened. The virus is bad but the panic is worse. It has made me think about my attitude to risk and whether I’m cut out for more active trading and I think that I’m not. I would be better off just passively investing, regularly contributions and seldom making any decisions. It’s a simple strategy but needs discipline to do it.

One blogger I really like is DIY Investor UK and he writes about (suprisingly) being a DIY Investor in the UK but more specifically he has recently churned his investments into a green portfolio which matches his ethical compass. He’s also not done too badly from the process which has seen the green bandwagon jumped on by investors in the last year and prices have gone up (although maybe they are not immune from the current turmoil).

Our own green investments have performed reasonably well. Slow and steady wins the race and we’ve maybe 25% of our investable assets in this type of thing and I’ve written about it once or twice. Other (non-green) investments have been affected by the current correction so whilst Greencoat Wind is down about 6.5% from its recent peak the FTSE100 is down 15.8%.

One thing to consider is that we shouldn’t care too much about the current price of our investments but rather the future value. If you are still accumulating (i.e. earnings less spending = saving -> investing) then any drop in prices is good news. The lower the prices now the better!

So that’s it. I could tell you that we spent too much in February or that we earned well but the truth is that a loss of £40,000 makes everything else seem insignificant.

Thanks, GFF

P.S. upcoming news includes a job move, when to time the floor and how to create a cashflow shower using Venture Capital Trusts.

5 comments

  1. It’s going to be a painful few months for lots in aspiring FI community. I suspect lots of spreadsheets models will see some adjustments. I’m currently just holding my current investments and continuing to make maximum contributions to my pension via salary sacrifice. Luckily I’m still employed and in my accumulation phase. Putting it all in perspective I probably lost the same amount ( in cash terms ) when I took a year off to spend with my son when he was 6 months old. These things happen and there’s not much I can so about the market situation – such is life. I feel much worse for those households with insufficient savings to cope with an extended period without work. For some, a couple of weeks without pay could be catastrophic.

    Liked by 2 people

  2. Trying not to look at my portfolio, and actually just topping it up as it goes down. I join you in the “green” though with green holdings- they have done ok in comparison. Let’s hope the virus goes away soon without too much more death etc!

    Liked by 1 person

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