Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

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bck63
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by bck63 » Sun Nov 17, 2019 7:03 am

livesoft wrote:
Sun Nov 17, 2019 5:45 am
Here's another perspective: Vanguard Total Stock Market Index fund is up 34.45% since last Christmas less than 11 months ago.
Get used to that at your own peril.

I'm not sure what the point of your post was. Are you saying 6.5% return is disappointing? Do you expect continued 34.45% stock market returns?

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JoeRetire
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by JoeRetire » Sun Nov 17, 2019 8:24 am

jsprag wrote:
Sun Nov 17, 2019 2:41 am
JoeRetire wrote:
Sat Nov 16, 2019 5:22 pm
rossington wrote:
Sat Nov 16, 2019 3:10 pm
If anyone cares VSMGX has a15.27% YTD return as of 11/15 according to a Google search. Not too shabby. After all it is a "Moderate Growth Fund".
You mean the Moderate fund isn't soaring yet has returned 15.27% YTD?
If one initially invested in VSMGX at the beginning of 2019 then they should be delighted with 15.27% YTD.

If one held VSMGX in January 2018, however, then they'd recognize that it took the majority of these 2019 gains just to get them back to where they were more than a year ago.
And of course if one held VSMGX prior to January 2018, you might even want to recognize any gains that occurred before January 2018 as well, right?

So you are saying that the time frame you choose to examine provides a context for how you analyze your returns. And that if you wanted to make returns look good you might choose one time frame, where if you wanted to make returns look poor you might choose a different time frame.

So if you chose some arbitrary point in time like "22 months ago", you might be attempting to make some sort of a point.

Okay. I think I understand.
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livesoft
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by livesoft » Sun Nov 17, 2019 8:26 am

bck63 wrote:
Sun Nov 17, 2019 7:03 am
I'm not sure what the point of your post was. Are you saying 6.5% return is disappointing? Do you expect continued 34.45% stock market returns?
My point was that one should rebalance into equities when the stock market is low such as on Christmas Eve 2018.
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JoeRetire
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by JoeRetire » Sun Nov 17, 2019 8:28 am

TropikThunder wrote:
Sun Nov 17, 2019 2:53 am
rossington wrote:
Sat Nov 16, 2019 6:44 pm
JoeRetire wrote:
Sat Nov 16, 2019 5:22 pm
rossington wrote:
Sat Nov 16, 2019 3:10 pm
If anyone cares VSMGX has a15.27% YTD return as of 11/15 according to a Google search. Not too shabby. After all it is a "Moderate Growth Fund".
You mean the Moderate fund isn't soaring yet has returned 15.27% YTD?
:beer
YTD performance isn’t very meaningful in this case since the market took a dump in December.
Other than "performance since the date I purchased" what is meaningful?
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by bck63 » Sun Nov 17, 2019 8:34 am

livesoft wrote:
Sun Nov 17, 2019 8:26 am
bck63 wrote:
Sun Nov 17, 2019 7:03 am
I'm not sure what the point of your post was. Are you saying 6.5% return is disappointing? Do you expect continued 34.45% stock market returns?
My point was that one should rebalance into equities when the stock market is low such as on Christmas Eve 2018.
Oh okay. I did that. Not Christmas Eve, but close enough.

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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by livesoft » Sun Nov 17, 2019 8:43 am

The other point of this thread is that when someone says "The market is soaring ..." or "The market is doing GREAT this year!" (*) then one should look under the hood and see whether it might be because of a special starting point. Such starting points can hide some (at least for me) interesting psychological or behavioral aspects of investors' and so-called pundits mindsets and outlooks.

Recency bias is a true thing.

(*) ... or the market is tanking or the market is falling ...
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by bck63 » Sun Nov 17, 2019 8:48 am

livesoft wrote:
Sun Nov 17, 2019 8:43 am
The other point of this thread is that when someone says "The market is soaring ..." or "The market is doing GREAT this year!" (*) then one should look under the hood and see whether it might be because of a special starting point. Such starting points can hide some (at least for me) interesting psychological or behavioral aspects of investors' and so-called pundits mindsets and outlooks.

(*) ... or the market is tanking or the market is falling ...
I totally agree. All this stuff is very complicated for me, so I try and keep it simple. What I do know is that if I get 6.5% return over the next ten years (when I retire), I will far exceed my goals. Fingers crossed.

Back to that perspective thing you mentioned.

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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by JoeRetire » Sun Nov 17, 2019 9:03 am

livesoft wrote:
Sun Nov 17, 2019 8:26 am
bck63 wrote:
Sun Nov 17, 2019 7:03 am
I'm not sure what the point of your post was. Are you saying 6.5% return is disappointing? Do you expect continued 34.45% stock market returns?
My point was that one should rebalance into equities when the stock market is low such as on Christmas Eve 2018.
Better do it early on Christmas Eve, 'cause holidays...

If only there were a magic way to know "today the stock market is at a low".

:confused
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by jsprag » Sun Nov 17, 2019 9:11 am

JoeRetire wrote:
Sun Nov 17, 2019 8:24 am
jsprag wrote:
Sun Nov 17, 2019 2:41 am
JoeRetire wrote:
Sat Nov 16, 2019 5:22 pm
rossington wrote:
Sat Nov 16, 2019 3:10 pm
If anyone cares VSMGX has a15.27% YTD return as of 11/15 according to a Google search. Not too shabby. After all it is a "Moderate Growth Fund".
You mean the Moderate fund isn't soaring yet has returned 15.27% YTD?
If one initially invested in VSMGX at the beginning of 2019 then they should be delighted with 15.27% YTD.

If one held VSMGX in January 2018, however, then they'd recognize that it took the majority of these 2019 gains just to get them back to where they were more than a year ago.
And of course if one held VSMGX prior to January 2018, you might even want to recognize any gains that occurred before January 2018 as well, right?
Yes
So you are saying that the time frame you choose to examine provides a context for how you analyze your returns. And that if you wanted to make returns look good you might choose one time frame, where if you wanted to make returns look poor you might choose a different time frame.
That's not what I took from the OP and subsequent dialogue. It isn't about making any particular gains look "good" or "bad", but about stepping back from the last few months and looking at the larger picture.
So if you chose some arbitrary point in time like "22 months ago", you might be attempting to make some sort of a point.
I'd contend that "highest point from any prior year" isn't arbitrary in terms of measuring subsequent performance. But to the point I think you're making, if you want to tell the story of VSMGX then you can't start there either.

Look, if you start watching a baseball game in the 6th inning and see your team score five runs then you might think they're doing great. But at the end of the inning you glance at the scoreboard for the first time and realize that they entered the inning with a four-run deficit and those five runs only delivered a one-run lead. Great inning, and certainly better than losing ground, but nothing to get excited about in the larger picture.

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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by harvestbook » Sun Nov 17, 2019 9:26 am

Since time is an upward spiral and not a string, I don't care about YTD at all except how it affects the year's taxes. I suppose gurus and advisers need a measuring stick, but I don't.
I'm not smart enough to know, and I can't afford to guess.

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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by livesoft » Sun Nov 17, 2019 9:39 am

jsprag wrote:
Sun Nov 17, 2019 9:11 am
....
Look, if you start watching a baseball game in the 6th inning and see your team score five runs then you might think they're doing great. But at the end of the inning you glance at the scoreboard for the first time and realize that they entered the inning with a four-run deficit and those five runs only delivered a one-run lead. Great inning, and certainly better than losing ground, but nothing to get excited about in the larger picture.
I really liked that analogy, so thanks for posting it. :beer
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by JoeRetire » Sun Nov 17, 2019 12:48 pm

jsprag wrote:
Sun Nov 17, 2019 9:11 am
Look, if you start watching a baseball game in the 6th inning and see your team score five runs then you might think they're doing great. But at the end of the inning you glance at the scoreboard for the first time and realize that they entered the inning with a four-run deficit and those five runs only delivered a one-run lead. Great inning, and certainly better than losing ground, but nothing to get excited about in the larger picture.
That's a great analogy,
as long as you don't think the first inning was "last year's low" or "last year's high" or some other arbitrary point in time,
and as long as you don't think you've won before the game is actually over.

The only first inning is when you bought, and the game isn't over until you sell.
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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by Luckywon » Sun Nov 17, 2019 1:18 pm

livesoft wrote:
Sat Nov 16, 2019 12:20 pm
Thanks to all who participated in this thread. I used a legacy M* growth-of chart dates 01/27/2018 to 11/16/2019. Legacy M* charts have a problem at both end points, so one-day changes make a difference. nisiprius's link used start/end dates that differ from the one's I used by one day each. The new chart tool at M* (that is, not the legacy one) may have this bug fixed (try it with dates 01/26/2018 to 11/15/2019).

VSMGX has about 6.5% total return reported for the dates I used while VBTLX has about 9.3%.

Bottom line: If one thinks the stock market has been soaring, it hasn't.
I'm very afraid to even go there so I won't even fully type the "i" word but I'm curious what the return would be same dates of a 48/12/40 portfolio? Any quick way to figure this out?

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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by Luckywon » Sun Nov 17, 2019 1:34 pm

Luckywon wrote:
Sun Nov 17, 2019 1:18 pm
livesoft wrote:
Sat Nov 16, 2019 12:20 pm
Thanks to all who participated in this thread. I used a legacy M* growth-of chart dates 01/27/2018 to 11/16/2019. Legacy M* charts have a problem at both end points, so one-day changes make a difference. nisiprius's link used start/end dates that differ from the one's I used by one day each. The new chart tool at M* (that is, not the legacy one) may have this bug fixed (try it with dates 01/26/2018 to 11/15/2019).

VSMGX has about 6.5% total return reported for the dates I used while VBTLX has about 9.3%.

Bottom line: If one thinks the stock market has been soaring, it hasn't.
I'm very afraid to even go there so I won't even fully type the "i" word but I'm curious what the return would be same dates of a 48/12/40 portfolio? Any quick way to figure this out?
Sorry, I did not realize VSMGX already includes about 24 % Non US stock currently.
Last edited by Luckywon on Mon Nov 18, 2019 1:57 am, edited 1 time in total.

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Re: Don't peek, but since the 2018 highs, a 60/40 portfolio is up by What Percent?

Post by randomguy » Sun Nov 17, 2019 7:00 pm

livesoft wrote:
Sun Nov 17, 2019 8:26 am
bck63 wrote:
Sun Nov 17, 2019 7:03 am
I'm not sure what the point of your post was. Are you saying 6.5% return is disappointing? Do you expect continued 34.45% stock market returns?
My point was that one should rebalance into equities when the stock market is low such as on Christmas Eve 2018.
And you should rebalance into bonds in Jan 2018 when stocks were high, stocks back in march when the were low, back to bonds in Sept and then buy stocks again on christmas. Then sell those stocks in april when they are high and then buy back in june when they are cheap.:) Probably making 50% a year with these couple of trades:)

I have seen little evidence that rebalancing/changing AA based strictly on how far off/above a peak you are has any success in generating returns. Going heavily into stocks when they are off 45% pays off but it is a pretty small sample size:)

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