RonBoyd
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Here is an interesting take on the lost decade:
Video - CNBC.com
Good post. Thank you.
Here is an interesting take on the lost decade:
Video - CNBC.com
Actually, it wasn't just the equities in DODBX that was hurt. The bond portion did just as poorly. I know, because I also own DODIX. It was creamed! Why? Because for the previous year DODIX had eschewed treasuries and other govt debt for corporate bonds. I had no idea DODIX had become so concentrated. Fortunately, DODIX recovered very well rest of 2009.Another fund that I still own, Dodge and Cox Balanced, performed very well until 2007, when they stumbled badly. They held too much financials! Curiously, Bogle spoke well of Dodge and Cox, even after they fell from grace. I think it was because of Dodge and Cox management's unquestionable integrity, compared to other shenanigans pulled by other mutual fund managers. Still, they should have known that these stinkin' financials outsized profits due to sham mortgages could not go on forever.
Very impressive CyclingInvestor! If I were willing and able to do the company/segment analysis you do, I would time asset classes too!Although I stayed about 100% in individual large/mid cap domestic equities, the last decade went well for me (allowing me to retire in 2006) mainly due to 3 'whole portfolio' decisions :
1) shifting very heavily into (undervalued IMHO) REITs in late 1998 (completely missing the 2000-2002 downturn)
2) shifting back into blue chips in 2005 (when REITs became fully valued and regular blue chips better values than REITs IMHO)
3) shifting the part of my investments from no-longer-blue-chip financials into other blue chips in early 2008 when I felt unable to analyze them anymore, softening the 2008 decline
Overall IRR for the decade : 17.8% / year
More important to me : average increase in dividend generating ability (my own standard) of almost 17% / year (my current portfolio is not as undervalued IMHO as my portfolio at the end of 1999 was).
Although I stayed about 100% in individual large/mid cap domestic equities, the last decade went well for me (allowing me to retire in 2006) mainly due to 3 'whole portfolio' decisions :
1) shifting very heavily into (undervalued IMHO) REITs in late 1998 (completely missing the 2000-2002 downturn)
2) shifting back into blue chips in 2005 (when REITs became fully valued and regular blue chips better values than REITs IMHO)
3) shifting the part of my investments from no-longer-blue-chip financials into other blue chips in early 2008 when I felt unable to analyze them anymore, softening the 2008 decline
Overall IRR for the decade : 17.8% / year
More important to me : average increase in dividend generating ability (my own standard) of almost 17% / year (my current portfolio is not as undervalued IMHO as my portfolio at the end of 1999 was).
It was, according to a wide range of data, a lost decade for American workers. The decade began in a moment of triumphalism -- there was a current of thought among economists in 1999 that recessions were a thing of the past. By the end, there were two, bookends to a debt-driven expansion that was neither robust nor sustainable.
Good forcasting!
Just wondering if your name is related to your love of biking or your love of cyclical investing?
If I were willing and able to do the company/segment analysis you do, I would time asset classes too!
Audrey
You missed a lesson:A very interesting exercise. Fortunately I used MS Money the entire decade and just had to push a few buttons to come up with the numbers.
A few qualifiers...
1. I worked the entire decade, except the last six months of 2009, at increasingly higher salary, bonus, stock options, etc.
2. Half of the NW went to the ex in March of 2000 in a divorce.
3. I was more than 80% in equities the first six years of the decade.
The results...
IRR
1/00 to 12/02 -28% IRR
1/03 to 12/05 +12% IRR
1/06 to 12/09 +11% IRR
For the decade +5% IRR
Net Worth Increase
For the Decade +500%
From Divorce date (3/00) +850%
From low point (4/01) +1400%
The lessons to be learned.
1. Stay invested, time is your greatest ally.
2. If you make more save a higher % each year. Guess this is the classice LBYM argument.
3. Diversify and be faithfull to your AA.
All in all a great decade as far as I'm concerned.
You missed a lesson:
4. Don't get married
TJ
or the corollaryYou missed a lesson:
4. Don't get married
TJ
A decade is long time ...
You missed a lesson:
4. Don't get married
TJ