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Re: How did you do in 2004?
Old 01-05-2005, 11:13 AM   #41
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Re: How did you do in 2004?

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Best investment return of the year: *from an hours work and a 9 month holding period - a 50% return!!
(Our daughter was born in January, and family of 2 became 3)
Wow! A sixty minute man. Way to go!

Mikey
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Re: How did you do in 2004?
Old 01-05-2005, 11:41 AM   #42
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Re: How did you do in 2004?

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My answer would have been similar to yours, but since I couldn't easily take out savings to get a true return I stayed quiet in anticipation of shrill noises and pointing.
I keep track of both, but since my goal is to achieve around $1mil of net worth, I care more about my net worth amount than I do my ROI.

By the way, my ROI this year was 9.83% not including any added savings. I did much better than that on my equities (around 18%), but I've got a large chunk in cash accounts that dragged my return down.
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Re: How did you do in 2004?
Old 01-05-2005, 11:59 AM   #43
 
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Re: How did you do in 2004?

I track net worth obsessively, but not ROI. Of course,
with most everything long term and fixed, it's not a
hard computation.

Called my broker yesterday as I noticed a little bit of "lazy money" sitting in their MM account and paying me 0.83% (not a typo). He tried (for the umpteenth time) to talk me into dumping this build-up into a
mutual fund. I thought he had given up

JG
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Re: How did you do in 2004?
Old 01-05-2005, 12:36 PM   #44
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Re: How did you do in 2004?

I just figured my return for 2004. I am up 16%. I am fully retired with no income source, so that figure is net of federal taxes paid ($14,000 estimated 2004 and final 2003); and living expense of about $28,000.

I feel quite good about this, as I had over 50% in fixed < 1 yr maturity. Also I made some fairly heavy and so far losing bets on QQQQ puts. Some have or will shortly expire worthless, some live on to fight another day. Another negative was poor results in my gold stock account.

Foreign stocks and US stocks did well, as did foreign bonds.

Day before yesterday I cut further my US equity exposure, incurred some more tax for '05, but I think positioned myself better for what I expect will be a down year.

I don't claim to be guru. But here is how I look at changing my risk exposure. I am walking down an urban street at midnight. I see a couple of young men approaching with a pit bull. I don't know that they or the dog are dangerous to me- They quite possibly or even probably are not. Still, I am going to attempt to cross the street. If I don't, I consider myself a dumb-ass.

Mikey, a dirty market timer

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Re: How did you do in 2004?
Old 01-05-2005, 01:15 PM   #45
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Re: How did you do in 2004?

John, when they make there share of the 5.75% sales load and residuals, they will probably not give up on the mutual fund idea!
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Re: How did you do in 2004?
Old 01-05-2005, 01:44 PM   #46
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Re: How did you do in 2004?

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But here is how I look at changing my risk exposure. I am walking down an urban street at midnight. I see a couple of young men approaching with a pit bull. I don't know that they or the dog are dangerous to me- They quite possibly or even probably are not. Still, I am going to attempt to cross the street. If I don't, I consider myself a dumb-ass.
Sorry, Mikey. It turns out those were two horny young women and their french poodle.
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Re: How did you do in 2004?
Old 01-05-2005, 01:52 PM   #47
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Re: How did you do in 2004?

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You two must be new here. * There's an unwritten rule that employed people aren't allowed to make up goofy IRR numbers that include unstated savings from earnings.

And besides that, just the thought of "permanent employment" is enough to give many of us here a bad case of the heebie-jeebies.
Wow, tough crowd. I find that by tracking our net worth, it gives us a more realistic picture of how we are doing. We can track our investments all we like but if we are increasing our debt load at the same time, then what's the point? Just my opinion of course.

As for the permanent employment line, I was hoping for a bit of sympathy from you
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Re: How did you do in 2004?
Old 01-05-2005, 02:05 PM   #48
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Re: How did you do in 2004?

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Sorry, Mikey. *It turns out those were two horny young women and their french poodle.
C'est la vie Monsieur Wab, n' est pas?

Monsieur Mikey
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Re: How did you do in 2004?
Old 01-05-2005, 05:37 PM   #49
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Re: How did you do in 2004?

I'm fully retired - wife works half time - both collect cola'd pensions. *We don't touch retirement savings yet (we're 61 and 64) *We currently save roughly 25% of our income - just practicing till she quits fully in 18 mos.

Portfolio increase (factoring out current savings ) for 2004 was 11.87%

Net Worth increase (not including house value changes) for 2004 was 11.9% also.

I sold about 30% of our portfolio on Dec 30 and moved it to cash - still have 50% equities after the sale. *I've been watching the market move into the neighborhood of all-time record valuations and I see 'buy' signs for most funds I would consider... but the contrarian in me says 'sell' when everyone is in a rush to buy. *The huge deficits, unemployment (we live in Ohio), and wasteful govt spending has me concerned for us FIRE-guys and for the country...

JohnP

Update: looked closer at net worth this morning and determined the 2004 net worth increase was actually +15.2%
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Re: How did you do in 2004?
Old 01-05-2005, 05:52 PM   #50
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Re: How did you do in 2004?

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I find that by tracking our net worth, it gives us a more realistic picture of how we are doing. *We can track our investments all we like but if we are increasing our debt load at the same time, then what's the point?
That's why I think it's more important to look at the balance sheet rather than the income statement, even though the latter feeds the former. You could have a 20% return on your investments year after year and still go bust.
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Re: How did you do in 2004?
Old 01-10-2005, 11:15 PM   #51
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Re: How did you do in 2004?

11.8%....vs a target of 6%...yeah I know....I'm ultra conservative... " )


"Slow and steady wins the race!"
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Re: How did you do in 2004?
Old 01-11-2005, 06:31 PM   #52
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Re: How did you do in 2004?

Netted 12% in 04 with a conservative portfolio...
--15% cash...just in case the big correction hit.
--20% TIPS
--10% high yield
--5% Investment grade corporates
--20% International...almost exclusively emerging market & small caps.
--30% U.S. value stocks...heavy yield weighting (REITS/Utilities/Oils/& a large dollop of small caps/fallen angels).

Getting my fanny spanked so far in 05!
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Re: How did you do in 2004?.
Old 01-11-2005, 08:14 PM   #53
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Re: How did you do in 2004?.

Wow, I think my net worth is up 39% for 2004. Half of the increase is debt eilimination and half is from a combination of new contributions and investment returns.

My debt was significant in proportion to my assets, and my assets were just slightly higher than my annual gross income at the start of last year, so the net worth increase isn't particularly useful for me for future comparison purposes, but it's a nice feelgood number for sure.

As far as investment returns, I edited my earlier post noting that Vanguard says I made 10.3% return, and I think they're probably right. My first rough calculations of 12-16% seemed high.
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Re: How did you do in 2004?
Old 01-12-2005, 06:00 AM   #54
 
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Re: How did you do in 2004?

Living off my investments, my net worth was flat in 2004.
This is okay with me. It went up almost every year
since I retired, until last year. That said, if I started to see a decline in net worth, I would get real motivated
to do something about it. "Flat" I can live with (I lived with my ex. for 32 years )
It's
a bit early for me to start drawing down my base. In fact,
if all goes according to plan (unlikely) I will never have to draw it down. Actually, this is more of a "wish"
than a "plan".

JG
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Re: How did you do in 2004?
Old 01-12-2005, 09:17 AM   #55
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Re: How did you do in 2004?

Net worth increase of ~12%
IRR of investments per Q of ~8.5%
Mostly S&P500.

malakito
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Re: How did you do in 2004?
Old 01-12-2005, 11:14 AM   #56
 
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Re: How did you do in 2004?

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That's why I think it's more important to look at the balance sheet rather than the income statement, even though the latter feeds the former. *You could have a 20% return on your investments year after year and still go bust.
The main problem with looking at net worth increase, is that it is a meaningless number. IOW - A guy can have a net worth of $1 at the beginning of the year and at then end of the year he has 100 bucks. His Balance sheet has a 10,000 percent increase. It does not correlate to anything or any investment vehicle as far as performance.

Likewise, when you are in retirement and your portfolio is slowly, slowly shrinking (which it should be - unless you want your heirs to enjoy your money) - You will have a negative Increase in Net worth some years.

The only thing that remains constant during your periods of accumulation and withdrawal is your Average Annual Return. This is how you rate any investment, whether it be a stock, bond or CD.

Hearing someone say I increased my Net Worth 58,000 per cent might sound impressive, but it is totally meaningless and will not correlate even for that individual from year to year. In fact the number will go down, the bigger the pile you have.

it's a lot like saying it's twice as warm today as it was yesterday. Zero information!
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Re: How did you do in 2004?
Old 01-12-2005, 11:29 AM   #57
 
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Re: How did you do in 2004?

Net worth "meaningless"? Although I understand what Cut-Throat is saying, I can't help but wonder if this was
a slightly late CHP?

JG
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Re: How did you do in 2004?
Old 01-12-2005, 12:03 PM   #58
 
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Re: How did you do in 2004?

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Net worth "meaningless"? *Although I understand what Cut-Throat is saying, I can't help but wonder if this was
a slightly late CHP? *

JG
No John it is too early for a Cocktail Post on my end. How about yours? :

You did not read my post again. I did not say 'Net Worth' I said 'Net Worth Increase'. Net Worth is a very meaningful number. Net Worth Increase stated as a Percentage is not!
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Re: How did you do in 2004?
Old 01-12-2005, 01:46 PM   #59
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Re: How did you do in 2004?

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The main problem with looking at net worth increase, is that it is a meaningless number.
I appreciate that if we are talking about starting with $1 and adding $100 to it. Even at that, the 10,000% won't happen year after year. I guess it makes more sense to talk about percentage of net worth increase only when it is associated with dollar amounts. Looking back at my net worth, I wasn't too concerned about net worth increase until I had $100K of net worth in the mid 90s. That's why I stated in a previous post what my moving yearly average was regarding my percentage of net worth increase over the past 10 years. And you're right in that the more net worth you have, the harder it is to obtain a high net worth increase percentage.

I also agree that once you are out of the accumulation phase, you only need to worry about controlling your net worth decreases. For example, after retirement, I may say "My net worth only decreased 2% this year from $1mil to $980K."

The reason I am more focused on net worth increase is because I know where my end game is and I know how much my net worth needs to increase each year to get to that point. It's not what you make, but what you save.
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Re: How did you do in 2004?
Old 01-12-2005, 02:27 PM   #60
 
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Re: How did you do in 2004?

Okay C-T, I see your point. It's semantics I guess.

JG
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