Are We Having Fun Yet?

Author

Armchair Income
April 20, 2025

The last edition (March 31st) contained: 3 Sales, 4 Buy, 2 Increases, 3 Reductions. That’s a lot!

This edition….NO CHANGES. 

Why?

1/ High Volatility

Huge daily price swings make it easy to lose (or win), a year’s worth of returns in one day. The market lost 6% on April 4th, and gained 9.5% on April 9th. Daily, or hourly timing has a greater effect on your returns than usual. 

2/ The Market Is Not in Charge

Remember when market prices were driven by….earnings, inflation, unemployment, interest rates….you know….boring financial stuff?

Those are currently overshadowed by tariff policy tweets. The President can decide if the market goes up or down on a given day, week, or month. Unless you’re in the Oval Office, that makes it difficult to set your expectations for the market.

3/ What is a “Good” Price?

Pricing for some stocks and funds looks “good” at the moment….compared to a month ago. Unless the tariff policies reverse 100% back to where they were in March, last month’s prices are not a reliable yardstick. In the near term, the market may go up (tariff deals announced, tax cuts, energy price deflation, deregulation, etc), or the market may go down (tariff war escalation, 10 year Treasury note selloff, USD devaluation, etc). However, what constitutes a “good” price, is less about the past, and more about the present and future.

For these reasons, I’m hitting “Pause” on Portfolio changes, until there’s at least a tiny bit of clarity on the outcome of the new US tariff policy.

Anybody Buying?

I spend the majority of my investment income on living expenses, but I’ll be reinvesting the portion I don’t spend on whichever income investments look like the best opportunity at the time I receive the income. These small monthly buys don’t move the needle much, but it feels good to at least grow my income slightly with new purchases at lower prices / higher yields.

This is my version of Dollar Cost Averaging, and it ignores whether the market is up or down.

As I type this on April 20th, adding some PFFA and ASGI looks attractive. Same for CEFS, but I already have a 5% allocation to that fund. Most income arrives at the end of the month, so the opportunities may look different by then. 

I’d like to pick up some Main Street Capital at a Price to Book ratio of 1.5 or less. It’s currently at 1.68. MAIN has a history of delivering consistent income during the 2008 Global Financial Crisis. Some investors are already buying the dip for MAIN, as explained in this article.

Portfolio Volatility

Here are the daily price changes for the last 2 trading days:

When the bull market returns, the S&P 500 will outperform the Armchair Income Portfolio, but for now, the lower volatility is welcome…as is the income.

Biggest Surprise

I consider Bitcoin to be a high risk investment, but it has held up surprisingly well. Not saying that Bitcoin is “low risk”, but it makes a case for diversifying beyond traditional stocks and bonds. Here’s the Total Return for the past 6 months from the 2 Bitcoin income funds in the portfolio:

Remember that most of the return for these Bitcoin funds comes in the form of distributions.

Recent Videos

(Published Since the Last Edition of Armchair Insider)

Armchair Insider Portfolio

Armchair Insider Portfolio, April 20, 2025 - Snowball Holdings.csv.pdf930.12 KB • PDF File

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Thanks for stopping by…see you in the next issue!

Regards,

Armchair Income

Disclaimer: I’m sharing information about my investments, but I’m not making any recommendations to you to buy or sell anything. Each investor has their own goals, risk tolerance, and timeline, and must make their own investments decisions…then take responsibility for those decisions. I’m not a financial advisor, and I don’t advise anybody regarding their investments. If the information in this newsletter is useful or helpful in any way, then my goal is achieved :) Some of the links provided above may be associated with affiliate programs. If so, use of those links will not incur any additional cost to the user (and will, in many cases, provide a benefit to the user) and may result in a referral commission to this newsletter.