PP Performance for 2016

[Thomas Hoog]

PP vanille:
Equities (40%), LT Bonds (30%), Gold (20%), Cash (10%) with a bandwidth balancing of 10%.

Performance 2016: 10,6 %. Thx to the rising of the $ to the €. And I sold some covered calls.
Since 2002: 6,9 %.

See my sloppy website:
http://www.verstandig-beleggen.nl/index.php?paginaid=7

[barrett]

See my sloppy website:
http://www.verstandig-beleggen.nl/index.php?paginaid=7

Hi Gerard,

Great to get a glimpse of how a Dutch PP has done. We don't see much data over here on Europe (well, at least data pertaining to the PP). Looks like your "sloppy" website shows a Dutch 4X25 PP returning 6.4% since 2002. Do you know what the after-inflation number is there in Holland?

Ah, it looks like inflation there has averaged between 1.6% and 1.7%. Here is my source:

http://www.inflation.eu/inflation-rates ... lands.aspx

So, maybe a real return of 4.7% or so?

[sophie]

It sounds like Gerard is holding a USD PP, and that some of the return this past year was the dollar increasing against the euro.

That worked out well this year, but you've taken on some currency risk that may not be necessary. The gold component is enough currency risk, since its price in local currency will reflect its value (high or low). I can understand wanting to hold US Treasuries rather than German long bonds, but are you also holding the cash allocation in dollars?

[barrett]

It sounds like Gerard is holding a USD PP, and that some of the return this past year was the dollar increasing against the euro.

That worked out well this year, but you've taken on some currency risk that may not be necessary. The gold component is enough currency risk, since its price in local currency will reflect its value (high or low). I can understand wanting to hold US Treasuries rather than German long bonds, but are you also holding the cash allocation in dollars?

Well, here is the breakdown from his site:

Cash: (25%): iShares Euro Government Bond 1-3yr
Gold: (25%): ETFS Physical Gold (EUR) (PHAU)
Bonds: (25%): ISHARES E GOV15-30
Equities:(25%) : iShares MSCI World UCITS ETF DIST

[Cortopassi]

Hey, I know it won't last... but feeling good about the rebalance out of some stocks and into gold/TLT on Tuesday.

My PP is up 1.92% already for the year. Hmmm... 2% a week would sure be nice!

[barrett]

Hey, I know it won't last... but feeling good about the rebalance out of some stocks and into gold/TLT on Tuesday.

Damn, you made me check out what's going on in the markets. Another New Year's resolution out the damn window!

[buddtholomew]

Dollar is weakening, yields are falling and gold as well as stocks are rising.
Isn't it supposed to work that way

[Kriegsspiel]

C'mon budd, you've been here long enough to know the drill; 3 steps forward, 2.88 steps back.

[Mr Vacuum]

Retirement (4x25 with stocks about 15 TSM, 10 SCB): 5.1%.

It was a little cash heavy at the beginning of the year and missed a percent of the initial run-up. I had contributed some money but just hadn't rebalanced yet!

College savings (25 stocks, 13 LTT, 12 total bond, 30 cash, 20 gold): 5.0%.

Brokerage (85 PRPFX, 15 TLT): 9.9%.

To-do: migrate the retirement portfolio to Golden Butterfly and add a bit of international to the extended market stocks allocation.

[steve]

Finished the year at about 5.6% gain
Last time I re- balanced was Dec 4 2015 4/25

[LC475]

SigFig is rounding the hundredth

Apt.

[buddtholomew]

C'mon budd, you've been here long enough to know the drill; 3 steps forward, 2.88 steps back.

Oh I know the drill well...

[Mr Vacuum]

Thanks, Shrugged.

I have developed an even simpler method. I merely monitor threads like this.

Fiddling with XIRR is good, clean fun because your asset allocation and trades are off the table. All that counts are your start and end values and dates and amounts of contributions of withdrawals. The main temptation in looking at it is to contribute more money. (Please follow your personal family budget change process before doing this.)

I find it worthwhile to track inflows and outflows in one place, regardless. Then if you already have something set up to update prices, the XIRR calculation takes care of itself and you have your very own number. I download and import a Fidelity portfolio positions csv file when I want to check. That combined with automatic spot gold price updates is about the right amount of hassle for me to check easily but not constantly.

[ozzy]

Hi All,

For 2016 my "Juicy" Permanent Portfolio returned 9.69%. My sloppy website: http://www.tightwadweb.com/customportfolio.html

Make America Great Again!

[barrett]

For 2016 my "Juicy" Permanent Portfolio returned 9.69%. My sloppy website: http://www.tightwadweb.com/customportfolio.html

Thanks for posting, Ozzy. For those who don't go to the website (which is not as sloppy as Ozzy claims!), here's the asset breakdown:

30% LTTs
15% Gold (IAU)
55% Stocks
No Cash

Stocks are broken down as follows:

15% TSM
15% Mid-Cap
10% Small-Cap
15% Intl. Small-Cap

[thisisallen]

Wouldn't including Cash bring the CGAR in the Juicy Portfolio more in line with the traditional 4X25?

[Thomas Hoog]

It sounds like Gerard is holding a USD PP, and that some of the return this past year was the dollar increasing against the euro.

That worked out well this year, but you've taken on some currency risk that may not be necessary. The gold component is enough currency risk, since its price in local currency will reflect its value (high or low). I can understand wanting to hold US Treasuries rather than German long bonds, but are you also holding the cash allocation in dollars?

In my own portfeuille:
Equities are maybe 30 % $ based / 70 % € based
LT bonds are 25 % $ based / 75 % € based
Gold is 50 % $ based / 50 € based
Cash is 100 % € based.

The benchmark Euro standard PP portfeuille is 100 % € based.

[KevinW]

Most of our funds are in plain 4x25 PPs, so those were in the ballpark of the 5.88% Sophie cited. DW also has a PRPFX holding which, I see, was up about 9% in 2016.

No plans to do anything different in 2017; we'll just keep chipping in and rebalancing as needed.

[Cortopassi]

From Saxo Bank/Steen Jakobsen



https://mishtalk.com/2017/01/10/steen-j ... ties-gold/

Looks like his standard allocation is a PP, and he is varying greatly for 2017/Trump.

[buddtholomew]

From Saxo Bank/Steen Jakobsen



https://mishtalk.com/2017/01/10/steen-j ... ties-gold/

Looks like his standard allocation is a PP, and he is varying greatly for 2017/Trump.

Cortopassi, the only difference I see is -5% for equities and + 5% for commodities. 50% in fixed income is the same as 25% fixed income, 25% cash.

[I Shrugged]

He must be saying to use the cash to invest in bonds, on which he must be very bullish.

[buddtholomew]

It's all about duration.

[Cortopassi]

I thought it was just interesting with so many out there saying the bond bull is dead and gold is going nowhere, that you are always able to find differing opinions.

[mathjak107]

the world changes all the time .

last year at this time all the building blocks were in place for a good stock market year . rates were still coming down , corporate profit estimates were lowered so company's were going to find it easier to meet or exceed their numbers and we had a lower stock market from temporary black swan events .

all in all equity's were a good place to be , this year is a lot tougher as rates are rising and the economy is stronger . market moves are never really great when company's are doing better , markets move up when the perception of the future is they will do better .

so having said that , stocks are counting on trump's plans to perform .

odds are the sell off in gold and bonds was way over done and as some of trumps plans work others will not so my feeling is we will not get the inflation and soaring bond rates anticipated ,especially because of the condition of the rest of the world .

so while i thought equity's should be the lead horse last year ,which they were , this year i think will be different .

so since the sell off in gold and long term bonds i have added a position back in , which so far is up nicely and hopefully will continue to do nicely .

so strategy's change as the big picture changes and that is why opinions vary . i am still not a fan of the pp but the gb does make a whole lot more sense to me .

[mathjak107]

as far as the relationship between corporate profits and market moves :

gains and corporate profits dont flow together more often than not.

in the book a random walk down wall street 548 nyse issues were tracked and analyed over 5 year periods and the results were the performance had no relationship between the technical and fundamental signals and the actual stock performance ..

ned davis research took another look at the relationship and going as far back as 1927 they found when profits rose more than


20% the s&p returned a mere 1.3% in gains

10 to 20% saw 5.8% in gains

(-10% to + 10% in profits saw a 9.3% jump in gains

(-10%) to (-25%) drop in profits saw 28.6% gains

(-25%) and lower saw a -28% drop in share price.