NW-Bound
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Jul 3, 2008
- Messages
- 35,712
OK, I will let you in on a little more.
In the spreadsheet that shows I could have almost another $2M if I had gone 100% on the S&P since 2011, I also looked at what I could have if I put it all in "psst... Wellesley". Would Wellesley beat me?
As it turned out, I did not trail Wellesley. Hurrah!
But, but, but Wellesley's stock AA of 40% is lower than mine, which runs 70% until recently. That means I still failed in terms of risk-adjusted returns. Why?
It was because I had very little bonds, but a lot of cash. The cash return is low, compared to that of bonds. In addition, about 1/3 of my stocks is in international including EM, and these just sucked royally in recent years. Counting just my domestic stocks, I did not do too badly, but it's the overall performance that counts, right?
I don't know yet what to do about the international stocks, but I have been trying to squeeze more returns out of my cash. Hence, the cash-covered put options that I have been selling for the last 2 years. That adds a few percents to my overall return.
In the spreadsheet that shows I could have almost another $2M if I had gone 100% on the S&P since 2011, I also looked at what I could have if I put it all in "psst... Wellesley". Would Wellesley beat me?
As it turned out, I did not trail Wellesley. Hurrah!
But, but, but Wellesley's stock AA of 40% is lower than mine, which runs 70% until recently. That means I still failed in terms of risk-adjusted returns. Why?
It was because I had very little bonds, but a lot of cash. The cash return is low, compared to that of bonds. In addition, about 1/3 of my stocks is in international including EM, and these just sucked royally in recent years. Counting just my domestic stocks, I did not do too badly, but it's the overall performance that counts, right?
I don't know yet what to do about the international stocks, but I have been trying to squeeze more returns out of my cash. Hence, the cash-covered put options that I have been selling for the last 2 years. That adds a few percents to my overall return.