My allocation of stocks explained

Everybody needs a strategy to maintain a path. I don’t claim to have the perfect stock strategy or portfolio allocation. I just need a strategy to prevent myself of buying stocks in east and west.

The strategy gives me room to play in the categories Stock Picks and Stamps.

Here is my overall strategy for stock allocation:

Stock picks31%
Index funds31%
Monthly paying dividend stocks8%
Dividend Kings and aristocrats25%
Stamps5%

Notice – these numbers state the allocation of the buying price. If my index funds increase more in value than the rest of the stocks, it won’t change this allocation.

Stock picks

The stock picks category is my personnal challenge to find dividend (growth) stocks from all over the world. One thing is to own the dividend Kings and Aristocrats, but I also want to diversify even further.

The Stock Picks has an allocation of 31 % of my total portfolio and maybe that is a bit too much – but this is one of the more fun categories and really motivates me to read and learn about the stock market.

Index Funds

This category is meant to be the underlying safe investments. I try to find passive index funds with a global exposure, but I also have some passive funds in bonds and an ETF Global Water and a property ETF.

All these also pays dividends

Monthly paying dividend stocks

These are the most questionable stocks in my portfolio. Are they in here just because they pay out monthly dividends… the sad answer is: yes!

I have started to think about this position and I think I need to reevaluate this allocation. The monthly paying stocks are riskier but have a great yield.

A solution might be, that I only buy these type of stocks with dividend – meaning I don’t risk my “own” money. In that way I get a succes if the stocks don’t collapse, but if they do I “only” loose money I have earnt.

Dividend Kings and Aristocrats

I have a goal of owning all Dividend Kings and Aristocrats. These stocks generate a steady (and growing) dividend. When I buy from this list I research which stocks are selling for a compareable or historically low P/E

The list changes every year, so I try to have the latest list.

Stamps

Stamps regarding stocks is a Danish term for a small portion of shares in a high-risk/high-reward type companies.

This is my playground. In the future this allocation will give me exposure to sectors with high potential without paying attention to dividends.

Sectors I hope to incorporate in my portfolio is cannabis, aerospace, AI etc.

Conclusion

Sometime in the future I will evaluate on the results from these categories and compare them to see, which ones generates the best return overall (increased market value + dividends)

I also reevaluate this allocation all the time – I think it is SOOOO boring to buy these index funds, but the truth is, that I should increase the allocation of these i nmmy portfolio.