Jump to content
sschullo

2019 Returns

Recommended Posts

Broad Market Returns for 2019

DJIA 23.76%
NASDAQ 37.89%
S&P 500 30.43%
Barclays U.S.Aggregate bond index 8.72%

I have not seen these prized returns since 2013 and the tech bubble 20 years ago. In 1999, my late hubby and I grew our portfolio $550,000. We hit the million-dollar milestone in November 1999, but our portfolio continued to grow another $500,000 in just four more months. We all know what happened between March 2000 and October 2002. 

Besides not being diversified among the equities and having 98% in sector tech funds and without a stock-bond balance, we were doomed. Furthermore, we also didn't know we won the game. Bill Bernstein wrote a few years later, unfortunately for us, "When you won the game, stop playing." https://www.bogleheads.org/forum/viewtopic.php?t=163863 

But we corrected those mistakes and quit playing the game about 2007 when our portfolio recovered, and I retired in 2008.  

Which leads me up to today. An unexpected pattern has evolved with my portfolio since 2008. While I stopped playing my portfolio didn't even with a very conservative strategy! 

Portfolio 2019 Return: 13.2%

I take very little risk according to the Standard Deviation (one measure of risk) of each of my investments. Most have a SD between 2-5 for the bonds and Wellesley and the rest are about 12 - 15 (Total Stock Market Index, Extended Market index and the total international stock market index). The asset allocation is shown in the pie chart below. 

End of 2019 RETURNS.JPG

Endof 2019 allocation.JPG

End of 2019 FEES.JPG

 

Did you notice the fees! OMG! I paid a whopping $1069.00 for my 7-figure portfolio. 

Happy New Year! 

2020 going to be another special year for me!

Some of you may have noticed on Facebook that I am engaged. No wedding plans yet. 

 

 

 

 

 

Share this post


Link to post
Share on other sites
11 minutes ago, sschullo said:

I have not seen these prized returns since the tech bubble 20 years ago.

It looks like the US market was up just shy of 31%. That is a great year any way you slice it. We may or may not hit a bear market soon. However, I'd like to add some context to the implication that great returns point to us potentially being on the cusp of bad news. We've broken the 20% mark 3 times in the last 10 years and one of those times, 2013, was even better than this year.

  • 2017: 21.19%
  • 2013: 33.51%
  • 2009: 28.76%

The bear market will eventually happen, but as they say, more money is lost preparing for bear markets than going through actual bear markets!

...it's also worth noting that the following years have tempered the explosive growth that we've seen in the years mentioned above:

  • 2018: -5.17%
  • 2015: 0.4%
  • 2011: 1.08%

Share this post


Link to post
Share on other sites

Ed,

Thanks for posting those returns. It's a nice segway into what those broad equity market returns and what they actually mean to an ordinary investor's do it yourself portfolio. 

  • 2009: 28.76%
  • 2011: 1.08%
  • 2013: 33.51%
  • 2015: 0.4%
  • 2017: 21.19%
  • 2018: -5.17%
  • 2019: 30.43

Here are my portfolio returns for the last 14 years. If you look at the broad returns above and look at my returns, my portfolio is doing what it is designed to do, follow the markets whether it goes up or down.

14 year return history.JPG

What was unexpected was the excellent returns for a very conservative portfolio! Average 5.97% annually for 14 years. There is room for both maintaining wealth but also taking on just enough equity risk to generate returns for retirement purposes. At my age and the fact that I need my investments to support my lifestyle, and I won the game, I no longer play the game. I will probably always keep my portfolio close to 30/70. 

Vanguard's Portfolio Allocation Models of 30/70 (click here) stock-bond split has an average of 7.1% over 90 years. My 5.97% annual average is very close to the 90-year average of 7.1% considering it is only 14 years. 

 

Share this post


Link to post
Share on other sites

My morningstar page went bonkers and lost my data I was surprised to find So I will have to figure it out but I can tell you it's been a good year for everyone who got in the market and stayed pat. Even bonds did well. I will post Calhaans periodic table of returns once its available. It will show which asset classes did best this year.

I'm glad for you Steve, congratulations on your engagement.

Tony

Share this post


Link to post
Share on other sites

With my usual caveat that a calendar year is a very short-term measurement from which one can't really draw any conclusions:  yep, this was an unusually good year for the portfolio.  The increase of my 75/25 portfolio for the year is approximately 20%.  

This was the first year when the increase in portfolio value exceeded my gross salary for the year.  I hope to be able to report that in coming years as well...

 

Share this post


Link to post
Share on other sites
18 hours ago, whyme said:

With my usual caveat that a calendar year is a very short-term measurement from which one can't really draw any conclusions:  yep, this was an unusually good year for the portfolio.  The increase of my 75/25 portfolio for the year is approximately 20%.  

This was the first year when the increase in portfolio value exceeded my gross salary for the year.  I hope to be able to report that in coming years as well...

 

Hey whyme,

Congratulations!!! If we cannot feel good about a single year, how are we going to feel when the market goes down over 2-3 years such as 2000-2002? There is nothing wrong with feeling good in a short time period. If some people draw conclusions, then they still have some more mistakes and more learning, just as I did when I was overly excited back in the tech bubble years. Wow! did I make mistakes, but I know now not to get too excited, but there is nothing wrong with feeling good about 2019.

My goodness whyme, you worked very hard all of these years to build your wealth so now you experience for one year that your wealth earns more than your GROSS salary. That's how investing is supposed to work!

Again congratulations! Most people do not experience what you reported. That's a significant landmark, and you should feel good! I would. 

Happy new year,

Steve

Share this post


Link to post
Share on other sites
15 hours ago, whyme said:

With my usual caveat that a calendar year is a very short-term measurement from which one can't really draw any conclusions:  yep, this was an unusually good year for the portfolio.  The increase of my 75/25 portfolio for the year is approximately 20%.  

This was the first year when the increase in portfolio value exceeded my gross salary for the year.  I hope to be able to report that in coming years as well...

 

Yes, that's a neat feeling when your returns are that high compared to your gross salary.  Mine were neck to neck, and at year end my returns were only about 2% less than my salary.

 

Share this post


Link to post
Share on other sites
2 hours ago, sschullo said:

Hey whyme,

Congratulations!!! If we cannot feel good about a single year, how are we going to feel when the market goes down over 2-3 years such as 2000-2002? There is nothing wrong with feeling good in a short time period.

Thanks very much, Steve.  Yes, I'm happy and excited to see the portfolio grow at this rate after so many years.  Congratulations on your engagement news!

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

×
×
  • Create New...