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Beating Index SP500
Old 01-12-2022, 03:28 PM   #1
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Beating Index SP500

Anyone here actually beat SP500 return in the last 3 years? .. If so if you don't mind sharing your knowledge and choices of holding..

I am happy to pay a Financial Advisor or an Agency such as Edward Jones, Vanguard, or Fidelity if they can prove that the last 3 years they managed portfolios that actually beat the SP500.

My experience talking to these people folks are about "balance and diversify", invest not to lose... after said and done, it seems like they were suggesting us to similar index like SP500 + some less risky bonds and want 1% fee.

I have 100% of my investment in SP500 for now. I hope to retire in 2,3 years. Kids are finishing up college.

Please recommend me an agency that can have deliever such promise. Maybe I live in the fantasy land.

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Old 01-12-2022, 03:30 PM   #2
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Quote:
Please recommend me an agency that can have deliever such promise. Maybe I live in the fantasy land.
I have to believe that's where you are with that request.
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Old 01-12-2022, 03:36 PM   #3
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It's not hard to beat the S&P in 1 year. Or 2 years, maybe even 3.

If a guy can beat the S&P consistently, he's too busy making money for himself, you cannot hire him.
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Old 01-12-2022, 03:37 PM   #4
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It's not hard to beat the S&P in 1 year. Or 2 years, maybe even 3.

If a guy can beat the S&P consistently, he's too busy making money for himself, you cannot hire him.

lol ... so true
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Old 01-12-2022, 03:56 PM   #5
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I'm sure you can easily find advisors who beat the S&P the last 3 years. Most likely they did it by taking more risks, which usually do well in bull markets. And they usually do poorly in bear markets. 3 years of good history is no guarantee of future success. I think you're setting a foolish standard that may get you in trouble.

The S&P did 28%, 18% and 31% over the last 3 years, with low inflation, at least until last year. Just how much better returns do you need?

I took too many risks in the dotcom bubble, mostly just riding out what had been working. Delayed my retirement by 10 years.
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Old 01-12-2022, 04:04 PM   #6
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It's easier to do in a growth environment like we had past few years. Take some risk on growth stocks and if it pays off you beat the S&P500. That risk can also result in less than S&P500. However to beat S&P500 in other than growth environments is harder IMHO. No matter what to beat S&P500 you have to take on more risk. As that old saying goes, higher risk for potentially higher returns.
I do have a small portion of my savings where I try to beat the S&P500; investing in individual company stocks. It is ultimately a market timing move mostly trying to pick those that are going up more than the overall market. I was doing real good last year until near the end of the year when they dropped more than the market overall. So last year I did not beat the S&P500, but it gives me something to do outside my majority boring index type funds that do the major load carrying in my nestegg.
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Old 01-12-2022, 04:08 PM   #7
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Running, well put. Sorry to hear about your experience but I think itís the best caution to the OP about his goal.

As Iíve been reading many members posts here in the ď2021 PerformanceĒ thread, Iím not sure that any of them ďbeatĒ the S&P 500 last year but uniformly everyone seemed very pleased with their results and their portfolios being larger than at the start of the year!
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Old 01-12-2022, 04:10 PM   #8
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You kind of know what the answer is already. There are always exceptions to the rule.
As mentioned, ask any advisor to prove to you how they beat the S&P in down markets.
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Old 01-12-2022, 04:39 PM   #9
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Beating the S&P in the past three years means very, very little to me. Now, if the last 3 years had included a significant and long bear, and somebody beat it, that would be more interesting, although, still, given the total quantity of prescribed portfolios, many of those were simply lucky and the luck probably won't last.
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Old 01-12-2022, 04:50 PM   #10
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Running, well put. Sorry to hear about your experience but I think itís the best caution to the OP about his goal.
I only got to that point by taking risks that paid off really well before the bubble burst. A good part of it was unavoidable risk by getting employee stock options with one of the hottest companies in that run, which I couldn't exercise immediately. I should have pulled my chips from the table when I got rich enough, but at least I learned some lessons. And if I had cashed out and quit, but stayed invested mostly in dotcoms, I could have been without a job and not FI. So I don't feel sorry for myself. And I was still able to ER before age 50 and it's been a worry-free retirement.
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Old 01-12-2022, 04:52 PM   #11
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I did it , it was mostly luck.
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Old 01-12-2022, 04:55 PM   #12
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My play account in Etrade has beaten the S&P. It says I'm up 91.02% vs. 81.8% for the past 3 years.

But that's just it - it's my play account. My risky bets, mostly with which I've been lucky. Small change stuff in terms of dollars I put in. And YTD I'm lagging a couple of points, so I was doing better at the two year mark!
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Old 01-12-2022, 04:59 PM   #13
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I have with my Roth. Google 95% 5% Tesla. I wouldn't do that with the bulk of my retirement.
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Old 01-12-2022, 05:45 PM   #14
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My play account in Etrade has beaten the S&P. It says I'm up 91.02% vs. 81.8% for the past 3 years.
https://ycharts.com/indicators/sp_50..._return_annual says S&P was up:

31-Dec-21 28.71%
31-Dec-20 18.40%
31-Dec-19 31.49%

Compounded thatís almost exactly 100%. Is that what your 91.02% compares to? Possibly you didnít consider the dividends that the Dow paid during the 3 years?
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Old 01-12-2022, 05:47 PM   #15
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My entire portfolio is up 0.80% today, against the S&P at 0.28%, Dow at 0.11%, and Nasdaq at 0.23%.

I am only 70% in stock, and diversified with 115 stocks, plus some MFs. But my concentration sectors happen to do well today. Metal and mining are up, such as X, FCX, STLD, BHP, MOS, etc... Also semiconductors, such as AMAT, TSM, LRCX, KLAC, etc...

The losers today include biotech, pharma, agriculture, energy. It just happens that my hot sectors outwin my losing sectors today.

What will happen tomorrow? I dunno.
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Old 01-12-2022, 07:35 PM   #16
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I'm ok with exactly meeting the S&P500 because that beats over 80% of professional, highly compensated fund managers whose job is to beat the S&P500. And paying someone 1% to do worse than I can makes no sense whatsoever. Why pay someone to suck?

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Old 01-12-2022, 08:00 PM   #17
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From what I compared using Portfolio Visualizer, one of my few managed funds, Fidelity Growth company (FDGRX) has been well above my Vanguard Index 500 S&P fund (VFIAX) for the last 3 calendar years (2019-2021). $10,000 at the start of 2019 would be 28,000 today in FDGRX vs 20,000 in VFIAX.

FDGRX has also beaten VFIAX in returns for 13 of the last 20 years.

But, I am fine with my VFIAX holdings being 5 times my FDGRX holdings. I am fine with those levels of investments for the comparative risk in up and down markets.

And, as always, past performance does not predict future results...
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Old 01-12-2022, 08:03 PM   #18
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Originally Posted by Enuff2Eat View Post
Please recommend me an agency that can have deliever such promise.
Nobody can make that promise.

And if they do, they're lying.
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Old 01-12-2022, 08:22 PM   #19
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Gentle reminder to use total return for the analysis. SP500 on a price basis is not the proper comparator, SP500TR is. One's own personal return should be evaluated inclusive of dividends and capital gains.
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Old 01-12-2022, 08:24 PM   #20
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Originally Posted by OldShooter View Post
https://ycharts.com/indicators/sp_50..._return_annual says S&P was up:

31-Dec-21 28.71%
31-Dec-20 18.40%
31-Dec-19 31.49%

Compounded thatís almost exactly 100%. Is that what your 91.02% compares to? Possibly you didnít consider the dividends that the Dow paid during the 3 years?
I am literally just reading off what etrade said. I don't think I have much in the way of dividends in these, but that's really not the point. Also, I'm not trying to pretend I can and/or should try to do better on my own, or that I would do more than run away from any FA who tried to make me any promises about beating the markets (lol). Initial investment here is less than 10k, 5 stocks. Just a play account.

I just thought it was a fun way to answer the OP and raised my hand. Jeesh.
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