January 2015 Portfolio Update

Its been an interesting month!  All kinds of news from various central banks all over the world.  100’s of companies reporting earnings and projecting what their sales and profits will be in the coming quarters.  Oil down, gold up, whats an investor supposed to do?  Ha, its easy.  Remember, a 6th grader can do this.  First lets review what we did in January:

01/31/15
VNQ 201 86.55 17396.55 4.66%
MTUM 248 67.59 16762.32 0.78%
VGLT 209 84.5 17660.50 6.08%
VTV 200 81.03 16206.00 -2.33%
VBR 160 102.28 16364.80 -1.35%
VBK 134 124.79 16721.86 0.66%
Cash 302.22
101414.25 1.41% 1414.25

The S&P 500 was down 1.27% since we entered the market and our portfolio was up 1.41%, a very respectable out performance. A $1414.25 profit for the month.

OK, what do we do now?  Well, I have done some additional research and have decided that instead of investing in the Top 6 of our 13 investment choices, we will now be investing in the Top 3.  Although this hasn’t been the case recently, over the past 40 years, investing in the Top 3 has returned a bit more than holding the Top 6.  The numbers don’t lie.  I thought going with the Top 6 might give me a little more protection and diversity but I cant deny the numbers.

I will post the details of the 13 investment choices next week but it looks like the top 3 have not changed so all we are doing here is selling off the 4-6 ranked investments from last month and reinvesting those proceeds evenly into the top 3.

So, that being said, our portfolio for FEBRUARY now looks like this:

02/01/15 Shares Price 2/1/2015 Change Month
VNQ 393 86.55 34014.15 0.00%
MTUM 492 67.59 33254.28 0.00%
VGLT 404 84.5 34138.00 0.00%
Cash 7.82
101414.25 0.00% 0.00

But what if the market crashes?  What if it doesn’t?  You see, with a portfolio built on rules, not predictions, you essentially remove guesswork and emotions from the multitude of variables that go into investing.  But what IF the market crashes…well, sometime this month I will review information from other blogs I read like http://www.investingforaliving.us and look at just what worst case scenario has been for a portfolio like this.

See, a six year old can apply these rules and techniques and make as much return (or more) than most money mangers.

Enjoy your month!

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2 comments

  1. Jaime L. (@365daytrader) · February 3, 2015

    Was this written after $SPG earnings reported? $VNQ seems extremely overbought. I agree in it being an excellent investment; I had plenty of call options brought for $.60 and turned into 650% profit. But if your goal is yield, still a risky play considering Yellen wants to increase rates this year. That would cut into your yield. Its no longer the safe haven it was in the beginning of 2015. Good original play in the beginning though…I was 100% in VNQ and now have made my goal for 2015. Congrats.

    Like

    • Brucejedz · February 3, 2015

      Yes this was written after SPG reported but I don’t pay attention those micro events. Doing so completely undermines the way this method works. This methods relies on what the ETFs are actually doing not what I or anyone thinks will or should happen. VGLT has essentially been over bought since Thanksgiving and has paid dividends and risen another 11-12% since. If I would have gone with my gut or chart thinking it was overbought I would have missed out on that move. Keep in mind VGLT is an ETF of Long Term Govt bonds and had a 10%+ move in 2 months! I know people that have been bearish on gov’t bonds for two years. All wrong. Let’s be honest, with the exception of a chosen few none of us have any ability to predict the markets and what should, would, or will actually happen. That’s why I have have a set of rules and methods (that a 6th grader can follow) independent of what the predictions are. The ETFs themselves will tell us what to do and when to do it. People have been talking rate increase for years and there’s no telling what Yellen will do..not to mention that this method or blog isn’t about call options or any predictions. Right now of my 13 choices VNQ, MTUM, and VGLT are the best and I will re-evaluate on February 28th and if VNQ does loose its momentum, the math will tell me so. Ntt saying one cant profit from short term call options or short term moves, but that’s not the purpose or goal of this method. Again, I am attempting to simplify things and remove decisions because most people most of the time are wrong and this has been proven over and over again. I know I will never call an exact top or bottom, but I will catch a long term share appreciation if and when it happens. Honestly, I don’t like holding VNQ right now BUT when you follow a quantitative method you have to, otherwise I might as well just day trade and that is not something I have the desire to do right now.

      Like

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