Portfolio Charts

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Tyler9000
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Re: Portfolio Charts

Post by Tyler9000 »

Quadalupe wrote:
Sat May 22, 2021 2:35 am
  1. Add the Fund Finder to the existing portfolio as the sheet. That way it's easy for people to quickly look at how they can actually implement a specific portfolio.
Done. The Fund Finder is now integrated directly to each portfolio and also the My Portfolio tool. And you can still use the Fund Finder on its own via the Charts page just like all of the other calculators. I like that setup a lot, and I totally agree that it's quicker and easier to use for exploring fund options within a portfolio.

Thanks for the suggestion, and bonus points for giving me a good reason to update the My Portfolio icon.

classical_Liberal
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Re: Portfolio Charts

Post by classical_Liberal »

Nice new updates @tyler9000, thanks!

I really like that you included the % real return on the heat map now. The auto expense ratio is nice too. Hope all is well! Take care!

Tyler9000
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Re: Portfolio Charts

Post by Tyler9000 »

Thanks @classical_Liberal. I admit that I'm especially proud of the expense ratio feature, so I'm happy to hear that you like it, too. :)

Life has been kinda crazy the last few months, but I'm doing fine all-things-considered. I appreciate the well wishes, and I hope everything is good for you, too. It's great to see you posting again!

classical_Liberal
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Re: Portfolio Charts

Post by classical_Liberal »

Hey Tyler9000!

Not sure if you still monitor this forum. I was just curious how you think/feel about the GB this year.

A back of napkin calculation tells me that STT are down about 5% (or maybe up 2ish if its held as a money market). Gold is down 9ish, LTT 30ish, SCV 20ish and S&P down 22ish YTD.

If this holds (or gets worse) it would mean a total YTD return around -16% nominal (-24% real) for the GB. Which would be, by far, the worst performance of this portfolio for the data set you have on Portfolio Charts. Admittedly, the year is not over.

This is not a dig on the portfolio. I still really like noncoorelation. But everything got so out of wack by mid 2021, I started ditching index assets and longer dated treasuries, which were clearly overvalued, moved to a lot of individual stocks, cash and even some shorting. Luckily I had the skill set to do this and keep my losses well below 16%, but a situation of total correlation of these assets classes (ie everything bubble) is pretty unusual historically. Yet here we are.

What do you think of the GB going forward? Has this year changed your thinking at all? Have you held-fast to the GB allocation personally, or modified it a bit?

Thanks in advance if you see this and answer. I hope life is going well for you!

Tyler9000
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Re: Portfolio Charts

Post by Tyler9000 »

Hey Classical Liberal.

I may not be posting much lately, but I definitely check in here all the time. You guys are the best.

Yeah, it has been a really tough year for pretty much all portfolios. I wrote this in July when things were clearly going downhill, and it still applies: Halfway to Nowhere: 2022 Mid-Year Portfolio Rankings.

For those who don't feel like reading the whole thing, here's the main chart:

Image

There's no hiding from the pain. The two portfolios that hurt the least are the ones with commodities allocations as oil has carried the day. But yes, it's rough out there.

As far as the Golden Butterfly goes, it's true that it's on pace for the worst year on record. The next closest is 1981 where it lost about 10% real, but comparing mid-year drawdowns to EOY sampling isn't a totally fair comparison. For example, after living through the 2020 crash where it was also down a similar amount I got some practice in not over-reacting. We'll see where it ends up by year end. Hopefully there will be more days like today where gold and LT treasuries take off. :D

But it's still doing better than most and always meets my needs. I personally moved half the short term bonds to REITs in my personal portfolio, but that was several years ago so nothing new or reactionary. I don't see any major changes in my future other than getting creative with rebalancing to harvest some losses and minimize taxes. It took years for me to find a portfolio that I'd have the confidence to stick with through both good times and bad, and I'm happy to be where I am.
Last edited by Tyler9000 on Thu Sep 29, 2022 9:45 am, edited 2 times in total.

classical_Liberal
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Re: Portfolio Charts

Post by classical_Liberal »

Hey Tyler9000!

That was quick! I read that half year article after posting.
Tyler9000 wrote:
Wed Sep 28, 2022 10:07 pm
I personally moved half the short term bonds to REITs in my personal portfolio, but that was several years ago so nothing new or reactionary.
Ouch! That hasn't helped. too bad because leveraged real estate in certain specific sectors has done very well (ie homes, or healthcare). You can make the right call, but still, the index can fail at producing returns. That has been a big take away over the past 18 months.
Tyler9000 wrote:
Wed Sep 28, 2022 10:07 pm
The two portfolios that hurt the least are the ones with commodities allocations as oil has carried the day.
I got lucky/smart because i allocated about 5% of my portfolio with two big oil stocks in 2021. It was because they were such values at the time. No one could have predicted the geopolitical issues, but as a commodity it was clearly being undervalued even without. My big take away here was that even a small percentage right (or wrong) bet can have huge implications for performance in a given year.

I guess I have learned to have fun with more active investing. I'm still down about 8% nominal this year, painful with 8% inflation to boot, but not too bad looking at the passive portfolios.
Tyler9000 wrote:
Wed Sep 28, 2022 10:07 pm
Hopefully there will be more days like today where gold and LT treasuries take off. :D
Gold has suffered because of the weak dollar and yield increases. I think it'll be ok going forward as we have almost reached max on those in this cycle (because stuff is breaking internationally already). LTT in the US could keep rising a bit, but the losses will be minimized now that we are back to historical norms. (shout out to your article about extremes and convexity).

The biggest lesson I have learned is that there are times to be a bit more passive and times to be a bit more active. Of course, this is also based on the bias that i enjoy learning about and testing these things.

Glad you are doing well! I'll be in TX at some point visiting my friend in Dallas again this winter. Maybe I can drive down and meet up at some point? If you're interest PM me with an email or phone #.

IlliniDave
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Re: Portfolio Charts

Post by IlliniDave »

Tyler9000 wrote:
Wed Sep 28, 2022 10:07 pm
...
There's no hiding from the pain. The two portfolios that hurt the least are the ones with commodities allocations as oil has carried the day. But yes, it's rough out there.
Hey Tyler9000, nice to see you stop by.

The chart you shared made me feel a little better. At last check the iDavePhaseIII portfolio fell sort of mid pack in that lineup. I had to changeover my 401k allocation at the start of the year because my former employer changed custodians and I wasn't able to map things quite the way I wanted. I'll be doing some significant TLH in my taxable account during Q4 unless there is a crazy bounce back. So for I've stood pat, drawing on my nonstandard 2008/2009 experience. I should also do a fairly significant rebalance, not sure I'll have the courage to do so though.

Glad to hear things are working out well for you.

simplex
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Re: Portfolio Charts

Post by simplex »

Hi Tyler9000,
Have you thought about an approach like https://www.livemint.com/market/stock-m ... 73624.html , i.e. changing allocations / leverage as you age? It sounds lie it makes sense, but I'm not sure if it actually does.

Tyler9000
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Re: Portfolio Charts

Post by Tyler9000 »

I feel like the articles pushing investing with leverage peaked late last year before inflation took off and markets cratered towards recession, but it looks like there might be a few holdovers. ;)

I'll admit that I'm personally not a fan of leveraged investing at all. As good as it sounds on paper, it only takes one bad event to wipe you out. That disconnect between idealized expectations and hard reality is why it's the #1 way that investors go bankrupt, and I've seen it ruin multiple smart and highly capable people up close. You feel like a genius right up until you lose it all.

As for the article, I don't really like how the discussion of risk with leveraged investing completely avoids even mentioning the words "margin call". I don't agree with the characterization that equalizing volatility all the way up to 100% stock in a large portfolio is the "right" amount of risk to target. And I also think that there's a lot more to proper portfolio diversification than recommending 100% stocks and pitching "time diversification" as on the same risk mitigation level as asset diversification. Because it's really not. One is definitely risker than the other.

All that said, I do think the concept is interesting and I appreciate you sharing. Maybe I can think about ways to model it. Who knows -- maybe hard data will change my mind.
Last edited by Tyler9000 on Fri Oct 21, 2022 1:29 pm, edited 1 time in total.

WFJ
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Re: Portfolio Charts

Post by WFJ »

Before using leverage, carefully read and understand the margin agreement. All stocks, all ETFs, all positions in a margin account can be moved from marginable to non-marginable in an instant without warning and generate margin calls. A long long time ago, I was on the emergency margin call team and when the SHTF, the largest positions held in margin accounts were moved into "non-marginable" with a click of a button, forcing margin calls to reduce the risk to the firm. I don't remember the exact tickers, but many blue chips, INTC, GE, IBM, CSCO, WCOM (equivalent to AAPL, AMZN, MSFT, GOOG, TSLA, VTI, VOO today) were instantly moved into non-marginable securities, inducing margin calls for retail investors.

All back-testing assumes all securities held will always be marginable and this is a false assumption, busting any back-testing when applied to reality of trading. I don't know if these "Use margin to become magically become rich" are written by ignorant investors or paid shills for brokers who make massive profits in margin accounts.

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Mister Imperceptible
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Re: Portfolio Charts

Post by Mister Imperceptible »

use
nonrecourse leverage and fixed rate loans

do not use
margin debt

steveo73
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Re: Portfolio Charts

Post by steveo73 »

WFJ wrote:
Fri Oct 21, 2022 11:03 am
I don't know if these "Use margin to become magically become rich" are written by ignorant investors or paid shills for brokers who make massive profits in margin accounts.
I'd say it's one of the two.

In trading in some markets you can get massive leverage and you can make massive profits. Note the can word. You can also lose massive amounts of money.

If you get it right you get uber rich. You can also go from uber rich to nothing.

I really don't see the benefit of doing this with your retirement savings but hey that's me.

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Seppia
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Re: Portfolio Charts

Post by Seppia »

“A long string of impressive numbers multiplied by a single zero always equals zero” is probably my favorite Buffett quote

Tyler9000
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Re: Portfolio Charts

Post by Tyler9000 »

Seppia wrote:
Sat Oct 22, 2022 2:47 am
“A long string of impressive numbers multiplied by a single zero always equals zero” is probably my favorite Buffett quote
Ha! Perfect. I'm totally going to save that one for later.

I'm tempted to model leveraged investing, but only with an additional feature of including what happens with a margin call. I suspect that it could be very educational. @WFJ (or anyone else) -- Can you point me to something that describes the different conditions that can instigate a call? I assume every margin agreement is different, but I'm guessing there are some common guidelines.

WFJ
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Re: Portfolio Charts

Post by WFJ »

Tyler9000 wrote:
Sat Oct 22, 2022 10:21 am
Ha! Perfect. I'm totally going to save that one for later.

I'm tempted to model leveraged investing, but only with an additional feature of including what happens with a margin call. I suspect that it could be very educational. @WFJ (or anyone else) -- Can you point me to something that describes the different conditions that can instigate a call? I assume every margin agreement is different, but I'm guessing there are some common guidelines.
Basics of margin call.
https://www.investopedia.com/terms/m/margincall.asp

Unless one can read and understand the entire margin agreement, don't use margin. Most articles and all back-testing models omit the fact that every broker can change what is marginable in an instant and create margin calls when SHTF.

frihet
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Re: Portfolio Charts

Post by frihet »

Eyeing the massive yearly "in gold we trust report" something caught my eye on page 159

Basically Tylers famous GBP allocation is being advocated, as the 60/40 doesn't hold up anymore. No credit is given though....Maybe he has come up with it himself.

The value of gold has been shown to me personally the last year and it recently reached an all-time high in Swedish kronor. It's a very good hedge for the currency debasement we experience here on top of the inflation.

https://ingoldwetrust.report/wp-content ... nglish.pdf

"Zoltan Pozsar
At the very least, you need to do something like 20/20/20/40. Meaning 20% cash, 20% commodities, 20% bonds and 40% stocks."

"Within that commodities basket, I think gold is going to have a very special meaning, simply because gold is coming back on the margin as
a reserve asset and as a settlement medium for interstate capital flows."

"I think cash and commodities is a very good mix. I think you can also put, very prominently, some commodity-based equities into that portfolio and also some defensive stocks. Both of these will be value stocks, which are going to benefit from this environment. This is because growth stocks have owned the last decade and value stocks are going to own this decade. "

ertyu
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Re: Portfolio Charts

Post by ertyu »

Commodities how? USO GLD URNM and whatever?

jacob
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Re: Portfolio Charts

Post by jacob »

ertyu wrote:
Fri May 26, 2023 7:23 am
Commodities how? USO GLD URNM and whatever?
Probably something like BCD ... unless you roll your own [commodity] futures.

Tyler9000
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Re: Portfolio Charts

Post by Tyler9000 »

@frihet -- Interesting. Good catch! Regardless of whether he was influenced by the GB or came up with it on his own, it's cool to see the concept getting wider attention. I do think that the general construction has legs.

In the context of his focus on gold, a fund like GLD or GLDM makes sense. For wider commodities, I generally recommend GSG but I really like Jacob's suggestion of BCD at less than half the ER.

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