Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Not happy with my portfolio performance - What's wrong?
Old 09-15-2012, 10:15 PM   #1
Dryer sheet aficionado
 
Join Date: Jul 2008
Posts: 27
Not happy with my portfolio performance - What's wrong?

Hi Guys,

I'm 33, no kids, not married yet but after reviewing my portfolio: I've only managed about 11% gains over the past 2 years (started June/2010). I am starting to wonder if I need to adjust my approach? 11% just doesn't look very good especially the market has been on a tear since then.

My simple approach:

For a business professional that travels a lot, I don't have time to track the market and between fighting jetlag and business meetings, I only have time and energy to track global financial information and haven't spent too much time studying all the financial products the world has to offer.

From what I've read, it is really hard to outpace the growth of the S&P500 over time so I basically bought index ETF's such as SPY and QQQ etc when times are BAD and just let it ride. It has been a good ride since 2010 but are my returns pathetic or is it ok for an amateur?

I'm sittting on 50% cash and 50% invested in the markets - not sure what to do next......

Any advice would be much appreciated.
__________________

__________________
A car is only as fast as the driver
dorikin_86 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 09-15-2012, 10:29 PM   #2
Thinks s/he gets paid by the post
 
Join Date: Jul 2012
Location: Mississippi
Posts: 1,878
For 50/50 11% is probably not too far off. SPY two year return is ~30% and cash is roughly 0% which give about a 15%, then depending on when you bought SPY that could account for the difference.

Probably at your age I would be all stocks for max cap gains, with cash cushion ( 90/10 maybe ). You have time in the market to ride the volatilty. YMMV
__________________

__________________
rbmrtn is online now   Reply With Quote
Old 09-15-2012, 10:49 PM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,615
You should have a simple, set-and-forget (almost) portfolio.

I've flown a lot on business and thus I've had plenty of time to read books. I suggest you get started here: Getting Started - Bogleheads
Then select 2 books from the reading list at that link. Then read those books and follow the advice.

You will learn that you don't have to study anything nor track the market. But you cannot sit in cash either.

Good luck!
__________________
LOL! is offline   Reply With Quote
Old 09-15-2012, 11:07 PM   #4
Thinks s/he gets paid by the post
target2019's Avatar
 
Join Date: Dec 2008
Posts: 3,705
Quote:
Originally Posted by dorikin_86 View Post
I'm sittting on 50% cash and 50% invested in the markets - not sure what to do next......

Any advice would be much appreciated.
Whatever is invested in cash will not grow. Inflation actually eats away at the cash, but that is another story.

At a 50/50 asset allocation, you are more conservative than me, a 59-year old. Of course you should have some cash based on your needs. But if you want more gain, you need to invest more of the cash, and more than likely in small cap fund, REIT, etc.

You can get a deeper analysis in many places, like forums at Morningstar. And you can really help yourself by reading a respected manual or book on asset allocation.

Good luck.
__________________
target2019 is offline   Reply With Quote
Old 09-17-2012, 02:38 PM   #5
Dryer sheet wannabe
 
Join Date: Sep 2012
Location: Alpharetta
Posts: 11
why is a young person in 50% cash?
2011 was a flat year -0% gain for the S&P 500
2012 is up pretty well (about 14%so far) and perhaps
due a small correction with the fiscal cliff, Europe woes
and Iran/Israel and Mideast worries... mark
__________________
Stress-Free Retirement is offline   Reply With Quote
Old 09-17-2012, 03:04 PM   #6
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 8,796
You mention you started in 2010.

Were you dollar cost averaging in (like in a 401k) or was it a lump sum invested in 2010.
If it's the former - then of course you didn't get the full 2 years return on the amount because not all of it was in the market the full 2 years.

As far as performance compared to market... That's why I use market index funds... It matches the market by design. I don't trust myself or an actively managed fund manager's ability to predict and outperform the market. I choose to be happy with matching market performance via index funds.
__________________
rodi is offline   Reply With Quote
Old 09-17-2012, 07:13 PM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,398
If you want something that is no fuss/minimal maintenance I suggest you check into the following:

Vanguard Target Retirement 2045 Fund (VTIVX)
Vanguard STAR Fund (VGSTX)
Vanguard Wellington Fund Admiral Shares (VWENX)

As others have suggested, your returns are low because you have too much cash earning next to nothing.
__________________
pb4uski is online now   Reply With Quote
Old 09-18-2012, 10:31 AM   #8
Recycles dryer sheets
 
Join Date: Jun 2011
Location: Hollywood
Posts: 50
If you're not going to educate yourself on what to invest in, then you're going to get lousy returns that barely beat inflation. If you want big returns you need to be looking for specific sectors or stocks that have great growth potential.

Look into precious metals and commodities, specifically the miners. My average agains over the last few years are in the 100-150% ranger per year in this sector. I still think there is a long way to go, considering FED policy and world wide currency devaluation.

Good luck!
__________________
nbw888 is offline   Reply With Quote
Old 09-18-2012, 10:36 AM   #9
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,069
Quote:
Originally Posted by nbw888 View Post
Good luck!
I'd caution the OP that if you expect "big returns" you will need good luck - a lot of good luck.
__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 09-18-2012, 10:44 AM   #10
Thinks s/he gets paid by the post
photoguy's Avatar
 
Join Date: Jun 2010
Posts: 2,301
Quote:
Originally Posted by LOL! View Post
You should have a simple, set-and-forget (almost) portfolio.

I've flown a lot on business and thus I've had plenty of time to read books. I suggest you get started here: Getting Started - Bogleheads
Also check out the page on lazy portfolios:

Lazy Portfolios - Bogleheads
__________________
photoguy is offline   Reply With Quote
Old 09-18-2012, 05:33 PM   #11
Recycles dryer sheets
 
Join Date: Apr 2011
Posts: 106
I'm waiting for the original poster to clarify if the 11% returns are including his cash or just the performance of his equity investments.
__________________
I'm not obsessed with money, I'm obsessed with work! Er, rather the not doing it anymore part...
ChadR is offline   Reply With Quote
Old 09-18-2012, 06:05 PM   #12
Recycles dryer sheets
 
Join Date: Dec 2011
Location: philadelphia
Posts: 106
Considering you went with index funds, your results aren't bad. With such a long time horizon, you should be in managed funds.
__________________
james7 is offline   Reply With Quote
Old 09-18-2012, 06:15 PM   #13
Full time employment: Posting here.
 
Join Date: Jan 2007
Posts: 585
Quote:
Originally Posted by james7 View Post
Considering you went with index funds, your results aren't bad. With such a long time horizon, you should be in managed funds.
Really?................Even though they'll perform worse than index funds?
__________________
Cut-Throat is offline   Reply With Quote
Old 09-18-2012, 11:39 PM   #14
Thinks s/he gets paid by the post
Spanky's Avatar
 
Join Date: Dec 2004
Location: Minneapolis
Posts: 4,046
Quote:
Look into precious metals and commodities, specifically the miners. My average agains over the last few years are in the 100-150% ranger per year in this sector. I still think there is a long way to go...
Didn't these sectors take some big beating recently?
__________________
May we live in peace and harmony and be free from all human sufferings.
Spanky is offline   Reply With Quote
Old 09-19-2012, 04:30 AM   #15
Thinks s/he gets paid by the post
 
Join Date: Mar 2009
Posts: 1,433
Total Stock Market/ Total Int'l Stock Market/Total Bond Market, pick your allocation, rebalance once year or whatever works. Keep it simple
__________________
Retired in 2016. Living off dividends / interest and a mini pension. Freedom.
foxfirev5 is offline   Reply With Quote
Old 09-19-2012, 08:01 AM   #16
Thinks s/he gets paid by the post
teejayevans's Avatar
 
Join Date: Sep 2006
Posts: 1,219
Quote:
Originally Posted by nbw888 View Post
Look into precious metals and commodities, specifically the miners. My average agains over the last few years are in the 100-150% ranger per year in this sector. I still think there is a long way to go, considering FED policy and world wide currency devaluation.
Really 100-150% Where did you pull that from??
Looking at VG's precious metals fund (mostly miner stocks):
Dec 31 2009: 20.44
Sep 17 2012: 17.53

TJ
__________________
teejayevans is offline   Reply With Quote
Old 09-19-2012, 12:11 PM   #17
Thinks s/he gets paid by the post
nun's Avatar
 
Join Date: Feb 2006
Posts: 4,835
Quote:
Originally Posted by nbw888 View Post
If you're not going to educate yourself on what to invest in, then you're going to get lousy returns that barely beat inflation. If you want big returns you need to be looking for specific sectors or stocks that have great growth potential.
You'll also be risking big losses.


Quote:
Look into precious metals and commodities, specifically the miners. My average agains over the last few years are in the 100-150% ranger per year in this sector. I still think there is a long way to go, considering FED policy and world wide currency devaluation.

Good luck!
Great returns......I would not recommend making such stocks/funds a major part of an AA. The OP is doing nicely at 11%. I'm very happy that my 20/40/40 AA is returning 9% YTD. That's 6% more than my ER plan requires.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”

Current AA: 65% Equity Funds / 20% Bonds / 7% Stable Value /3% Cash / 5% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
nun is online now   Reply With Quote
Old 09-19-2012, 12:13 PM   #18
Recycles dryer sheets
 
Join Date: Jun 2011
Location: Hollywood
Posts: 50
Quote:
Originally Posted by teejayevans View Post
Really 100-150% Where did you pull that from??
Looking at VG's precious metals fund (mostly miner stocks):
Dec 31 2009: 20.44
Sep 17 2012: 17.53

TJ
I began investing at the lows in February/March of 2009. That fund is mostly large tier miners, and agricultural stocks. I pick individual stocks mostly, and mainly junior miners. I like First Majestic Silver, Great Panther, Silvercorp, Jaguar, Endeavour, Silver Wheaton.

Check them out. Most have had some pretty good gains over the last few years. You can also play ETFs, such as AGQ. If timing is your game, you can trade the volatility in these stocks as well.
__________________
nbw888 is offline   Reply With Quote
Old 09-19-2012, 03:12 PM   #19
Thinks s/he gets paid by the post
nun's Avatar
 
Join Date: Feb 2006
Posts: 4,835
Quote:
Originally Posted by nbw888 View Post
I began investing at the lows in February/March of 2009. That fund is mostly large tier miners, and agricultural stocks. I pick individual stocks mostly, and mainly junior miners. I like First Majestic Silver, Great Panther, Silvercorp, Jaguar, Endeavour, Silver Wheaton.

Check them out. Most have had some pretty good gains over the last few years. You can also play ETFs, such as AGQ. If timing is your game, you can trade the volatility in these stocks as well.
Hmm, "play"...."timing"......"trade the volatility". If the OP is truly disappointed with 11% he might want to get familiar with such terms. He'd also probably get familiar with ulcer medication and beta-blockers.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”

Current AA: 65% Equity Funds / 20% Bonds / 7% Stable Value /3% Cash / 5% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
nun is online now   Reply With Quote
Old 09-19-2012, 03:18 PM   #20
Recycles dryer sheets
 
Join Date: Jun 2011
Location: Hollywood
Posts: 50
Quote:
Originally Posted by nun View Post
Hmm, "play"...."timing"......"trade the volatility". If the OP is truly disappointed with 11% he might want to get familiar with such terms. He'd also probably get familiar with ulcer medication and beta-blockers.
Haha very true. I guess the best advice if you want higher returns is that you'll first need to grow a pair.
__________________

__________________
nbw888 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 09:29 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.