December Report

Got back Friday from a long trip to Vermont and am getting up to speed - the coming week will be spent mainly on preparations for teaching the next semester. Good news is that Thursday I got an e-mail from my lawyer that she has received the documents to go to the next stage in my green card application - the actual application for the visa itself. The process started in 2003 and looks like being finally concluded this year. With a green card I will have much more freedom of employment and location than I do now as an H1-B holder.

Income and Expenditure



The monthly report for February explained the basic layout of these monthly statements. This month there is a new line for "tax credits". The current (non-retirement) investment returns are reported on a pre-tax basis. Part of the total return on investment includes foreign (mainly Australian taxes) paid on dividends. I get to claim these back on my annual US tax return. The "current other income" includes my net tax refunds (this category is mainly salary). If it wasn't for these credits my reported "other income" would be lower as my tax bill would be higher. Up till now I have been doing a kind of double-counting on these reports and slightly exaggerating my actual saving and income. For the moment I've chosen to compute saving by deducting both expenditure and tax credits from total income. I guess I should report all income on a pre-tax basis and then include a line for taxes. This would mean changing my accounting systems to actually record gross income monthly and then include stuff like health insurance in spending. At the moment my reported salary figures are take home pay after all deductions. So my expenditure is also somewhat under-reported too I guess...

Anyway, getting to this months results:

Expenditure was $US2,092 - $500 more than last month partly due to travel and spending on my trip to visit my girlfriend in Vermont - 64% of take home pay ($3,290) which is much reduced due to maxing out my 403(b) contributions from this month forward. Only one of my two new higher retirement contributions posted to my account and so expect to see retirement contributions ($1,180) higher next month. Non-retirement invesment returns were very strong this month ($6,564) and were the most significant factor in increasing net worth by $10,149.

Net Worth Performance

Net worth rose by $US10,149 to $US364,714 and in Australian Dollars gained $A13,322 to $A462,366. A net worth of half a million Aussie Dollars is now clearly in sight but one never knows what fluctuations could occur on the way there...

Investment Performance
Investment return in US Dollars was 2.21% vs. a 2.26% gain in the MSCI World Index, which I use as my overall benchmark and a 1.40% gain in the S&P 500. Non-retirement accounts gained 3.51%. The contributions of the different investments and trades is as follows:



The returns on all the individual investments are net of foreign exchange movements. Foreign currency losses appears at the bottom of the table together with the sum of all other investment income and expenses - mainly margin interest. Powertel again had one of the best percentage gains. The Everest Brown and Babcock entry covers returns on a listed fund of hedge funds and the management company itself which are both listed on the Australian Stock Exchange.

Asset Allocation
At the end of the month the portfolio had a beta of 0.90. 58% of the portfolio was in stocks, 45% in bonds, 7% in cash, and loans totalled -21%. The remainder was in the hedge fund type and real estate investments, futures value etc.