2015 YTD investment performance thread

[Cobra9777]

Up 2.4% YTD as of yesterday's close, same as a 60/40 benchmark of VTI/BND.

Real estate continues to be the bright spot, which makes up for 3 not-so-bright spots:

1. International emerging markets, where I increased my position earlier this year.
2. A high-dividend ETF that is overweight energy and utilities.
3. Two corporate bond ETFs (1 high-yield) that have underperformed the overall bond market.

 

[robnplunder]

Up 2.5% YTD, anemic return at best but I think I am not too far from average. My two short term trading accounts are my best performers and 12% & 15% return so far. My worst are international funds.

 

[Alan]

As of Dec 1st, XIRR is 0.97% (takes into account all withdrawals)

 

[gcgang]

Gotta see if I'm still in last place. DWRR -(3.39)% thru 11/30.

 

[KMyer]

Up 2.4% including dividends. I'm glad that I didn't pay any investment advisory fees. I would have been pretty upset to have used half of my earnings to pay fees.

 

[jfn111]

Did my month end and up 5.4% YTD in my 401K. This includes all withdrawals.

 

[pb4uski]

+1.75% YTD (annualized basis) per Quicken Investment Performance report YTD through December 1.

 

[target2019]

+ 1.29% since 1/1/2015.
Backed out new contributions, new cash, etc.

 

[Corporateburnout]

Up 2.71% through 12/1

 

[NW-Bound]

Yeah, I'm going to wait until my next set of dividends are known in a few days.

When stocks or MFs go ex-dividend, their prices drop by the same amount.

 

[Mulligan]

When stocks or MFs go ex-dividend, their prices drop by the same amount.

I thought we fought that battle to a draw a few months back and decided it was the most trite discussion of all time.


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[NW-Bound]

Was it? I missed that lively discussion, I guess.

Anyway, in several years past, when Wellington or Wellesley distributed year end dividends, there was always a poster asking what caused their MF price to drop a couple of percent while the market was flat. If I care, I guess I can find the threads again.

 

[Mulligan]

Was it? I missed that lively discussion, I guess.

Anyway, in several years past, when Wellington or Wellesley distributed year end dividends, there was always a poster asking what caused their MF price to drop a couple of percent while the market was flat. If I care, I guess I can find the threads again.

Oh, NW shame on you...You missed a good one! I kept stumping the other side with my preferred stocks. I have one listed at $102 that hasn't changed price in 2 years, but has kicked out $15.50 in dividends the past 2 years. So it should be at $86.50 and ultimately heading to zero based on that concept. But that isn't going to happen.


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[NW-Bound]

I am not talking about the long run, only immediately before and after the ex-dividend date. So, I am not disputing you at all.

Let's look at a tree bearing fruit. The tree and its fruits together weigh 1000 lbs. After you pick 50 lbs of fruit off the tree, that tree is going to weigh what? Yes, it's now 950 lbs.

Then, given time it will grow new fruit and weigh 1000 lbs again. And if that tree is not a "preferred" tree but a "growth" tree, it may weigh 1,100 lbs next season even.

Anyway, when people buy stocks and pick dividends off them, they hope their stocks are like trees that will grow new dividends, unlike chicken that cannot grow new wings or legs after you hack these off them.

 

[Mulligan]

I am not talking about the long run, only immediately before and after the ex-dividend date. So, I am not disputing you at all.

Let's look at a tree bearing fruit. The tree and its fruits together weigh 1000 lbs. After you pick 50 lbs of fruit off the tree, that tree is going to weigh what? Yes, it's now 950 lbs.

Then, given time it will grow new fruit and weigh 1000 lbs again. And if that tree is not a "preferred" tree but a "growth" tree, it may weigh 1,100 lbs next season even.

Anyway, when people buy stocks and pick dividends off them, they hope their stocks are like trees that will grow new dividends, unlike chicken that cannot grow new wings or legs after you hack these off them.

In general I agree with you. I skipped to the nuanced part. But in reference to my example, it does not drop the $1.94 after going exD and never does. It stays at $102, because it never trades. Nobody including me is willing to sell. I have accumulated in dribs and drabs, but a stock price will not officially change price unless a 100 shares trades hands in one transaction.
Ultimately the stock will sell at a price determined by buyer and seller not the exD price. Though the very liquid ones can open at that price.


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[NW-Bound]

In general I agree with you. I skipped to the nuanced part. But in reference to my example, it does not drop the $1.94 after going exD and never does. It stays at $102, because it never trades. Nobody including me is willing to sell.

Again, I agree with you.

Ultimately the stock will sell at a price determined by buyer and seller not the exD price. Though the very liquid ones can open at that price.

True too. A single stock's daily fluctuation is often enough to mask out the ex-dividend effect. Hence, this effect is most clearly observed on an MF which is composed of hundreds of issues, hence the individual stock fluctuations average out to something that can be directly compared to the market, namely the S&P. When a yield-oriented MF like Wellesley, Wellington, or Dodge and Cox issues dividend, one can see clearly the effects when he compares it to the S&P that day.

Many MFs will go ex-dividend soon. On that day, one will see that if the S&P goes up, the MF may still go up, but less. Or if the S&P goes down, the MF goes down more. Then, add the dividend back in, and everything makes sense again. And we will see some panicky posters asking what goes wrong with their MF to cause that big drop relative to the market. This has happened several times since I frequented this forum.

By the way, I have observed this type of heated discussions often in life. One side may argue that chicken do not fly, while the other may say that but ducks do swim. Both are right, and they are talking about different things altogether.

 

[NW-Bound]

I have experienced the following ex-dividend effect that was most pronounced.

I owned a stock, of which I wrote a covered call. The stock went up, and the covered call ended up being in-the-money, which meant the option got exercised. My stock was taken from me, and money for the strike price deposited into my account. But what is this? They gave me less than what I was supposed to get!

A call to my broker brought an answer. A couple of months earlier, the company issued a special unscheduled dividend. This happened occasionally when a company holds too much cash, and investors force them to disgorge it.

I was immediately reminded of that special dividend that amounted to something like 10% of the stock value. As this unscheduled large dividend was taken out of the company's coffer, its net value dropped by the same amount that day. Its price eventually climbed back up, but the option strike price was adjusted downwards by the option board to make it "fair" to the option holder. No windfall profit for me as I originally expected.

By the way, when a stock is split, the option is also adjusted. For one contract, you have to deliver 200 shares now instead of 100. No windfall profit here either.

 

[audreyh1]

When stocks or MFs go ex-dividend, their prices drop by the same amount.

Not true for many (most?) bond mutual funds. Their dividends accrue like a savings account or CD that pays interest monthly.

Which is why, at the end of the month, I wait a couple of days for dividends to come in to calculate my YTD gain.

Most Vanguard bond funds accrue interest to the share holders daily. Here is a typical statement from a prospectus:

Each Fund distributes to shareholders virtually all of its net income (interest less expenses) as well as any net capital gains realized from the sale of its holdings. The Fund’s income dividends accrue daily and are distributed monthly.

The term accrue used in this sense means that the income dividends are credited to your account each day, just like interest in a savings account that accrues daily. Since the money set aside for your dividends is both an asset of the fund and a liability, it does not affect the calculated net asset value. When the fund distributes the income dividends at the end of the month, the net asset value does not change as both the assets and liabilities decrease by exactly the same amount. [Note that if you sell all of your bond fund shares in the middle of the month, you will receive as proceeds the value of your shares (calculated as number of shares times net asset value) plus a separate distribution of the accrued income dividends.]

In most equity funds and balanced funds, dividends do not accrue to you; and you only become entitled to them if you hold the fund on the distribution date. Therefore, accumulated dividends are not liabilities of the fund; as dividends come into the fund, the net asset value increases. Only when the dividends are paid out does the net asset value decrease by the dividend amount.

https://www.bogleheads.org/wiki/Net_asset_value#Bond_funds_versus_equity_funds

 

[Mulligan]

Again, I agree with you.



True too. A single stock's daily fluctuation is often enough to mask out the ex-dividend effect. Hence, this effect is most clearly observed on an MF which is composed of hundreds of issues, hence the individual stock fluctuations average out to something that can be directly compared to the market, namely the S&P. When a yield-oriented MF like Wellesley, Wellington, or Dodge and Cox issues dividend, one can see clearly the effects when he compares it to the S&P that day.

Many MFs will go ex-dividend soon. On that day, one will see that if the S&P goes up, the MF may still go up, but less. Or if the S&P goes down, the MF goes down more. Then, add the dividend back in, and everything makes sense again. And we will see some panicky posters asking what goes wrong with their MF to cause that big drop relative to the market. This has happened several times since I frequented this forum.

By the way, I have observed this type of heated discussions often in life. One side may argue that chicken do not fly, while the other may say that but ducks do swim. Both are right, and they are talking about different things altogether.

I love the Duck/Chicken debate analogy, NW. You aren't falling for the bait and see the trap. One poster just couldn't let the dividend thing go and eventually got backed into the corner where he was trying to justify the exD price to actual next day selling as automatic and was brought down with his own SEC link. Kind of useless, humorless, academic nerd fest food fight debate that you correctly sidestepped.


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[NW-Bound]

Not true for many (most?) bond mutual funds. Their dividends accrue like a savings account or CD that pays interest monthly.

Which is why, at the end of the month, I wait a couple of days for dividends to come in to calculate my YTD gain.

https://www.bogleheads.org/wiki/Net_asset_value#Bond_funds_versus_equity_funds

Yes, you are correct.

The difference here is really due to the matter of bookkeeping of the accrued interest of the bonds. I am reminded of how I keep track of my I bonds with Quicken. Its bottom line takes a bitty jump at the beginning of each month as the interest is posted. If I wanted to be more accurate, I would project and add the even bittier interest each day, as that would represent what I would get if I were to redeem it in the middle of the month.

I love the Duck/Chicken debate analogy, NW. You aren't falling for the bait and see the trap...

I think in practice, this kind of things depends on how large the dividend is. I humbly suggest two more analogies.

Case A) You go to the market to buy a hen. After pointing to a nice looking hen and haggling for the price but before you hand the money over to the farmer, the hen lays an egg right there for everybody to see. Should the farmer hand the egg over? It does not matter much in this case, does it?

Case B) You buy a tract of timberland. After you agree on the price but before the contract sign date, the seller cuts it clear of the valuable redwood trees. Would you be upset? In fact, you would be dumb not to specify the condition of that tract in the offer.

 

[Senator]

As of 10/31/15, Fidelity's latest calculation, I am up 5.32% overall. Fidelity shows the S&P being up 2.7% during that same time frame. I think November was up, so I should be just a bit higher. It is only returns, and does not count my savings, which are just shy of $193K for 2015.

I had/have ~10% total cash during that period, all of it in one account. My fully invested accounts were up 6.95% and 5.94% respectively.

I do not have a top-secret plan, nor any rocket scientist trading platform, just monthly investments. The accounts are mostly IVV, IVW, QQQ, IWM with dividends reinvested. No commissions or fees (that I can see) on any accounts.

I think Buffet and Bogel are right.

My 401K is up 2.17%, basically similar investments, but no monthly additional investments. I max it out early in the year by mid-March.

 

[audreyh1]

Yes, you are correct.

The difference here is really due to the matter of bookkeeping of the accrued interest of the bonds. I am reminded of how I keep track of my I bonds with Quicken. Its bottom line takes a bitty jump at the beginning of each month as the interest is posted. If I wanted to be more accurate, I would project and add the even bittier interest each day, as that would represent what I would get if I were to redeem it in the middle of the month.

I just wait until I can download the divs into Quicken. Fidelity funds dists are available the next day. Third party funds aren't available for download until 2 business days later. So on Dec 2nd, I finally have all my Nov divs downloadable into Quicken.

My IBonds I only update quarterly since it's all manual.

 

[pb4uski]

I wonder, do balanced funds like Wellesley, Wellington, et al use the method equity funds use or a blend? I suspect the former.

I actually do not like the approach used by the bond funds and would prefer the equity approach as it show my portion of the true value of the underlying assets.... there would be no need to wait until bond income dividends are distributed to get a true view of where you stand.

 

[audreyh1]

I wonder, do balanced funds like Wellesley, Wellington, et al use the method equity funds use or a blend? I suspect the former.

I actually do not like the approach used by the bond funds and would prefer the equity approach as it show my portion of the true value of the underlying assets.... there would be no need to wait until bond income dividends are distributed to get a true view of where you stand.

Balanced funds use the equity MF approach. The Bogleheads link specifies that for the Vanguard balanced funds.

 

[simple girl]

If you're adding cash to your portfolio, one needs to calculate IRR or otherwise adjust for that fact. I'm not sure if that spreadsheet does that, or just takes the simple ($start-$now)/$start. Although not as good as IRR, you might try ($start-$now-$addedSinceStart)/$start.

OK, I'm finally getting back to this. I want to get an overall ballpark estimate of our YTD growth - don't have time to track monthly investments from 401k and enter it into an IRR spreadsheet. So, I tried to use the formula above: ($start-$now-$addedSinceStart)/$start

When I put my numbers in, I am getting a negative return, which doesn't make sense to me since the account has grown more than what we have invested (total invested this year so far is $37,951 and the overall balance has grown by $64,703, so our net growth for the year is $14,752). So the return should be a positive number. Shouldn't the formula be: ($now - $start - $addedSinceStart)/$start