XIRR 2.27% through April 1st
AA 46/54/0
AA 46/54/0
Above was for YTD February.A bit early for end of Feb 2017. Will have to do:
YTD Wghtd Perf - 3.57%
Port Total YTD - 8.13%
4.63% YTD based on XIRR of beginning balance, withdrawals, cash dividends and ending balance using a 12/31/2017 date. AA of 65/35/5.
I have been rebalancing more often than normal into the rally to keep cash up giving upcoming wedding costs later this year.
I really like that 105% allocation total. So you borrow 5% and invest it? What interest rate do you pay?
If you look inside the funds I listed this morning in this thread, then you can see that higher allocations to foreign equities helped and lower allocations to US small cap value helped, too. Here is a chart to show that:[…] Our performance YTD at 3.7%
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I am curious how some folks like us in retirement, are getting a higher performance. What traditional measure of risk? Not just the performance but how do their allocations approach the efficient frontier?
@OldShooter, that's a nice experiment. I predict your 100% equity ploys will create something like a Callan Periodic Table of Investment Returns. Just worry about skating to where the puck was.
It's really just another form of stock picking. By picking classes you are diversifying away individual stock risk and choosing sector risk over total market risk. IMO, though, "near term performance" is so dominated by noise that you are simply spinning one of those "Wheel of Fortune" machines that you see in Vegas. You will never know whether your results are from luck or skill. Over the long term, not considering any costs, you will probably get the market average but that long term is longer (due to the smaller sample size) than the long term it takes to get the total market return by just buying a total market fund. So you get to the same place by a longer road with more potholes. My 2c anyway.So instead of stock picking, what about asset class picking? Or at least predicting the future near-term performance of asset classes?
Couch Potato; 2/3 total US market, 1/3 total Int'l: 6.4%
Schwab "Intelligent Portfolios" 5.7%
DFA 50/50 USA/Int'l with a slight emerging market tilt: 6.2% net of 1Q 12.5bp fee
Also "efficient frontier" does not mean "best return." Personal Capital touts a small-cap value overweight, but SCV did great in Nov-Dec 2016 and has taken a breather so far in 2017.
Bond funds have done relatively well: Despite FFR hikes in December and March, bond funds are up 1% for the quarter and on track for a very typical one-year return of 4%.
Big question though: Is it time to rebalance out of foreign into US small-cap value?
And I am thinking of doing almost the opposite. Isn't investing fun?I believe we have some room to add to small cap, but mostly we are low on international, which means selling a bit more VWENX to buy more international equities some day soon.
And I am thinking of doing almost the opposite. Isn't investing fun?
I guess that's in the eye of the beholder. They are close enough for me/I can eyeball the effect of differences. For example, the couch potato (CP) portfolio over the last 9 quarters has slightly outperformed the ACWI and slightly underperformd the Russell 3000. That's to be expected given its allocation and the better performance of US stocks in the period. I don't need to have exactly identical allocations to also see that's also why the CP very slightly outperformed the DFA portfolio over the period.... But your 3 selections do NOT have "All of the allocations are essentially the same." ...
I'm not sure I get your point. If you're saying that it takes a long time to separate the signal from the noise in stock prices (have you read Nate Silver's book?) you are obviously right. But I am comparing very similar portfolios with each other, so I believe that I can tease out a performance difference signal more quickly than 20 years. For example, the CP portfolio performance has monotonically diverged from the disastrous Morgan Stanley portfolio even as quarterly performance numbers have ranged from -6 % to +9%. I can't back it up with statistics but I think the fact they they are 6% apart and continuing to diverge after 8 quarters is signal, not noise. YMMV, of course.I found this video series on "Managing Expectations" full of useful ideas when thinking about all these things ...