How Value and Price Are The Same, Yet Entirely Different…

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A few weeks ago a question about value and price that Mr. Divnomics had in one of his classes set off an interesting discussion. We talked about this subject and questioned ourselves if value and price were actually the same things. Or are based on different kinds of fundamentals. The outcome of that class was that price and value were the same things, which we both disagreed on. His teacher loved the discussion going forward and had planned a new discussion on the next class with some upfront preparation.

In order to get some more thoughts and opinions on this topic, I wrote a blog post on our thoughts of the matter. And there were great replies that made us think about our view towards value and price.

Last weekend the second class took place, and another discussion with the group got to a very interesting conclusion.

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Going Minimal – How Less Can Mean More

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We’re all downsizing, saving and living frugally. The reason for this is to live a life without too much consumerism and building wealth for the long term. We’re at it for about 2 years now, but in the meantime, our mindset has shifted 360 degrees around. We’re not saving money only because we want to get more of it… But because we have certain values that just don’t fit with owning lots of stuff anymore.

If you want to become happier, you don’t need all those extra things in your life. Better yet, you need to get rid of them. It can clear up space, remove worries and move you forward.

The big change is that we don’t feel the urge to save money. We just think of how we can live a better life, and additionally, we save the money we don’t spend.

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Dividend & Portfolio update – May 2017

Monthly dividend and investing update

Another month in the books. Only one left to go and we’re already halfway through this year! We’ve made some new steps in our real estate venture and our monthly dividend has never been this high before. Partially because of a very unexpected special dividend we have gotten. Always nice to earn some extra without lifting a finger. All in all, it was a great month.

After the deception of last months results, things couldn’t have gone better this time around. We’ve received the late dividends of Munich RE and got a surprise extra dividend from BESI. Resulting in our best month ever!

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Our First Steps of Investing in the Real Estate Market

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We have taken it a bit slow the past few months, as it comes to dividend investing. Our last stock buy was way back in January, which is already 5 months ago. Like, I notice I get triggered with everything that has to do with DGI, and can’t wait to buy some new stock again.  Normally we invest money in stocks every 2 months or so and set aside a vast amount of money every month for this goal only.

However, we made a little change to our investment strategy.
Since a few months, another project has actively been part of our investment plan: rental properties.

We made this step because we wanted to have an additional income stream beside dividend growth investing. And ah yes, diversifying our portfolio is also one of the reasons.

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What’s The Deal With FIRE in Europe?

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When I started this blog in September last year, I did so with the thought there weren’t much Dutch or even European finance bloggers out there. Little did I know.

I’ve connected with the world of #FIRE through 2 top-notch bloggers out there, Jason Fieber (formerly known as Dividend Mantra) and MMM. When Dividend Mantra was no more, I quickly ended up looking for other blogs and found sites like Dividend Diplomats and later on some others as well. But it wasn’t for after I started Divnomics when I learned how big this community really was.

Still, it looks like the growing flow of FIRE and personal finance blogs has much more ground in the US than in Europe. How could that be, and is it really the case?

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Opinion: The Difference Between Value vs. Price

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Some of the grandmasters in investing have always taught us that the price and value of an asset are 2 fundamentally different things. Value is something that can be calculated, for example with the Discounted Cashflow Model (DCM), and the price is based on supply and demand.

This is also what we use to determine our investments. Whether a stock is undervalued or not, and is fundamentally sound. And moreover, if the value would be higher than the price being paid for it.

But there are also other theories, which state that the value is equal to price. Like when the value of an asset is based on the price that others are willing to pay. Or as Oskar Morgenstern says it:

“A thing is only worth what someone else will pay for it.”

What’s the deal on this?

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Monthly Dividend & Portfolio Update – April 2017

Monthly dividend update

Well, it happened, for the first time ever our dividend hasn’t grown year over year. And to put it blankly, it actually decreased a lot. But, we haven’t lost anything. The biggest chunk of our ‘normal’ April payments will now be paid in May. Therefore our results for this month a quite a bit skewered.

I promise, that this hole will be filled though. Big Time. Because on the other part, we managed to get an amazing additional income for this month. Our savings have been flooded by something we had been waiting for, for over 6 months now….

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King’s Day: Orange, Festivals, and Flea Markets

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The Netherlands is a rather small country. And also one of the 43 sovereign monarchies that we have in this world.

Every year on this day, we celebrate the birthday of our King. It’s a national holiday, where nobody has to work (yes!) and goes out on the streets. The festive holiday is well known in foreign countries and lot’s of tourists know how to find this little country when it’s the 27th of April. In the big cities, there are all kinds of paid and free music festivals, food stands on the streets and usually, a lot of beer is also involved. For the ones that don’t know it that well, it’s quite a unique happening.

What does this have to do with money? Well, besides some people complaining that having a king is expensive, this day is also the day you can earn some cash on flea markets.

The royal celebrations were first held on 31 August 1885, in honor of the birth of Queen Wilhelmina. Throughout the years it’s been celebrated ever since. Today is in the honor of Willem-Alexander, who is actually the first male monarch in 123 years.

It’s a busy day of the year for some. In Amsterdam, the crowd can go up to 600.000 or sometimes a million people who decide to go out on the streets and canals. Some others, like myself nowadays, are avoiding the big city and take it a bit calmer and closer to home. But it’s a happening like no others, and if you just go with the flow and care to enjoy, it can be a celebration of a lifetime.

Orange is the new black

There is one thing on this day that is perfectly normal to us (well kinda) but not for so many others. Orange is our national color, and a lot of people literally turn orange for this day as a show of pride for the Dutch royal family. Yes, it looks crazy, but so does the rest of the people. There are even all kinds of special merchandising products to fill in on the festivities, like orange beer, hats, wigs, orange pastries and even chocolates in the shape of the king’s head (no joke).

To get an image of how it can look like, I’ve found a rather good video that illustrates a King’s Day in Amsterdam.

Why the orange?

The origins of our national color go back to the 1550’s or just before the start of the 80-year war. Willem of Nassau inherited the French princedom Orange, which was later added to his name as Prince of Orange. During the 80 year war, he needed a national flag, in which he used the colors orange, white and blue. In 1596 the orange turned red, and orange became the one and only national color.

Earning the money

One other thing that is related to this big day, are flea markets. They are happening in almost every city. So there is something with (earning) money involved? Well yes, but I stopped going to flea markets a long time ago. When I was a kid I had my own very spot on a market selling my old toys. At the end of the day, I had a little profit, which made me feel like a little entrepreneur and keep it for who knows what.

But it always a good time of the year to clean up the house and sell the items that are unnecessary. There are some people that are really earning some big money on this day. Where it turns out the average street-seller makes a 90 euro on King’s Day.

When the book of Marie Kondo was published: The Life-Changing Magic of Tidying Up, a new trend was born. Decluttering and organizing your home. Along with it, the minimalism movement grew worldwide to a new and embraced lifestyle by many. We aim to be partly minimalistic and only to buy items that have their worth. But are not near as minimalistic as how it could be. Still, we too have items lying around that we haven’t used for months or even years.

So today when many others are wandering around at flea markets, I thought to use it as a way to start decluttering and place some items for sale online. I already placed a small figurine last weekend to check out how fast it would be sold. And it just so happened that it was sold in 1 day for 30 euro. Sweet! I have found enough other items we no longer need or are lying in the back of a closet for years, which we can use to make others happy with it instead. So today, I use my free time of work, amongst other things, to list these items for sale and check out how much it can bring us.

Have you ever sold items in flea markets or garage sales, or on online listings? Or are you rather willing to give it away for free?