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The American Worker Is Becoming More Productive

davfordavfor
edited January 3 in Other Investing
The review provided in the attached article indicates AI helped American workers increase their productivity in 2024. Strong stock market returns in 2024 appear have been largely based that increase as well as AI's potential to significantly increase long term productivity growth.

My dividend focused portfolio was 71% invested in stocks as of 1/1/24 and returned 15.7% in 2024. Per Fido, the largest driver of my 2024 returns came from the Information Tech stock sector which increased from 10% to 15% of my portfolio holdings during that time (AVGO is currently represents 39% of the holdings in that category).

What will happen in 2025? The promise of AI remains alive and it appears that it continues to animate the stock market. I am currently tempted to let the 3% increase in the % of stocks in my portfolio during 2024 ride in 2025 as I suspect the stock market will probably cling to the promise of AI for a while longer (my investment portfolio is taxable so harvesting capital gains is a consideration).

Any thoughts will be appreciated as I finalize my list of any beginning of the year adjustments. (So far nothing has made it to that list.)

Increased Worker Productivity

Comments

  • Art
    The biggest contributors to my portfolio in 2024 was my TECH and Utility stocks. Holding until I see another sector(s) look better.
  • davfordavfor
    edited January 3
    @ Art

    My portfolio holdings were generally unchanged in 2024 except for a little tweaking within sectors (mostly during pullbacks to limit taxable gains). The Info Tech and Financial stock sectors contributed the most to my 2024 total portfolio returns. The lower level of Info Tech dividends paid by its holdings during 2024 contributed to the year-end increase in the stock % held in that sector. The higher level of dividends paid by my REIT and Financial sector holdings during the year contributed to their year-end stock sector % declines.

    % of Stocks .... % of Stocks

    12/31/24 ........ 01/01/24

    20% .. Real Estate .. 24%
    20% .. Info. Tech. .. 14%
    12% .. Utilities .. .. 11%
    17% .. Financials .. .. 18%
    13% .. Energy .. .. 13%

    82% .. Total .. .. 80%
  • Art
    Do you reinvest dividends? I do not.
  • davfordavfor
    edited January 4
    @Art

    Only for OEF's with transaction fees including RPHIX. Dividends and some capital gains earned during the year get distributed to my household account at the end of the year unless a significant portfolio decline causes me to retain some of them in the investment account for the following year.
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