madsinger monthly report

[madsinger]

Here is a big fat collection of portfolios, with their October 2010 returns, 2010 YTD return, and annualized returns since 1999, 2001, 2005 and 2007 (11 years 10 months, 9 years 10 months, 5 years 10 months, 3 years 10 months). I broke them into four categories, roughly corresponding to 100/0, 80/20, 60/40, 40/60 stock/bond portfolios, sorted by Total Return since 2001. The 3 fund is 50/30/20 Total Stock/Total Int'l/Total Bond. The s&d is 10 each of VFINX, VIVAX, NAESX, VISVX, VGSIX, 25 VGTSX, 5 VINEX, 20 VBMFX. The coffeehouse is a 60/40 described at The Coffeehouse Investor. The Newsletter portfolios are from a newsletter following Vanguard funds. William Bernstein's "Sheltered Sam" is an all stock portfolio which is 20% VFINX, 25% VIVAX, 5% NAESX, 15% VISVX, 10% VGSIX, 3% VGPMX, 5% each VEURX, VPACX, VEIEX, and 7% VTRIX. The madsinger portfolio is my real-world portfolio, roughly 62/5/3/30 stock/REIT/PM/bond.

-Brad.

Code: Select all

                                  CAGR    CAGR    CAGR    CAGR
                  Oct     YTD     since   since   since   since
                  2010    2010    2007    2005    2001    1999
Hot Hands         4.89%   9.20%  -7.92%   2.34%   8.52%  10.89%
Sheltered Sam     3.65%  10.73%  -1.94%   4.06%   5.35%   6.03%
VFINX             3.80%   7.73%  -2.59%   1.58%   0.67%   1.38%
                  
s&d               3.05%  11.04%   0.57%   5.09%   6.08%   6.68%
Newsletter G-IND  3.93%  11.10%  -0.35%   4.37%   4.46%   3.91%  
Newsletter G      3.76%   7.70%  -0.50%   4.51%   4.35%   8.03%  
3 fund            3.09%   8.38%   0.86%   4.64%   4.09%   4.34%
LS G              3.15%   9.46%  -0.94%   3.13%   2.93%   3.33%
                  
coffeehouse       2.41%  10.84%   2.31%   5.08%   6.20%   6.46%
Wellington        2.13%   7.14%   2.57%   5.33%   5.93%   6.17%
STAR              2.46%   8.03%   1.95%   4.48%   4.91%   5.59%
Newsletter CG     3.19%   6.80%  -0.15%   3.94%   4.01%   6.07%  
LS MG             2.40%   9.48%   1.02%   3.83%   3.80%   4.06%
                  
Wellesley         0.88%   9.98%   5.21%   5.93%   6.48%   6.32%
LS CG             1.76%   8.90%   2.46%   4.16%   4.28%   4.48%
Newsletter Inc    2.26%   8.80%   1.15%   3.57%   4.19%   3.98%  
                  
madsinger         3.09%  11.66%   1.56%   5.29%      

[HearDoc]

The newsletter returns are unknown ?

[madsinger]

Another strong month for stock investors in October. Some stock heavy portfolios now have double digit returns through October.

REITs were up almost 5% for the month, and are up over 25% year to date. Vanguard's precious metal fund was up almost 8% for the month and is up over 20% for the year. Portfolios with these funds are the portfolios with the double digit gains.

Vanguard Total Bond fund is up over 8% for the year, so even the bond heavy portfolios are showing solid returns this year.

Yesterday marked the end of the three year period from a market "high". Later, when all portfolios have reported, I'll post the three year returns for these portfolios, just to see how they have weathered the markets since that high point.

Wishing you all well.

-Brad.

[madsinger]

The newsletter returns are unknown ?

I wait until they post their returns publicly online (or until someone posts them for me). When they update their site, I'll update this chart.

-Brad.

[madsinger]

The newsletter returns are unknown ?

I wait until they post their returns publicly online (or until someone posts them for me). When they update their site, I'll update this chart.

-Brad.

Thank you to the person who sent me the newsletter returns. The chart has been updated accordingly.

As you can see, the most important fact on the chart is that the madsinger portfolio is leading the YTD race! :roll: Subscriptions to my newsletter will be requested soon. :lol:

The 8% total of my portfolio in REITs and PM has added a couple percentage points to my return this year. I do know this strategy can just as easily remove those couple of points in another year.

-Brad.

[HearDoc]

As you can see, the most important fact on the chart is that the madsinger portfolio is leading the YTD race! :roll: Subscriptions to my newsletter will be requested soon. :lol:
-Brad.[/quote]

Leading to the soon to be infamous "Madsinger Bubble".

[madsinger]

Leading to the soon to be infamous "Madsinger Bubble".

Oh...so true!

-Brad.

[madsinger]

October 31, 2007 was a (month end) high point for my portfolio and for many stock market averages. I thought it might be interesting to see what these portfolios looked like three years later.

Not surprisingly, the higher bond percentage allocations have led to lower losses (or in some cases gains) in the past three years. Wellesley is up over 14% over the past three years (annualized return of about 4.5%). Hot Hands has to return over 50% from here to get back to the level it was three years ago. (Although, I would not really call this a "portfolio" --- the past three years have shown what can happen to such a narrowly focused strategy).

Kudos to Coffeehouse for being positive!

In the chart below, the first four columns are last two months of 2007, 2008, 2009, first 10 months of 2010. Column 5 is total return, column 6 is annualized return.

No real "conclusions" from this, and not really any big surprise. Just helps to look at the real data every now and then!

-Brad.

Code: Select all

                                                     3 year   
               Nov-Dec                     Jan-Oct   Total   Annualized
                2007      2008     2009     2010     Return    Return
Hot Hands     -10.17%   -47.86%   21.74%    9.20%   -37.74%   -14.61%
Sheltered Sam  -7.15%   -37.91%   30.62%   10.73%   -16.61%    -5.88%
VFINX          -4.86%   -37.02%   26.49%    7.73%   -18.35%    -6.53%
                     
s&d            -5.84%   -30.16%   26.93%   11.04%    -7.31%    -2.50%
Newsletter G   -6.33%   -38.40%   34.40%    7.70%   -16.48%    -5.83%
3 fund         -4.28%   -30.74%   26.56%    8.38%    -9.07%    -3.12%
LS G           -4.26%   -34.39%   24.99%    9.46%   -14.06%    -4.92%
                     
coffeehouse    -3.70%   -20.25%   20.60%   10.84%     2.66%     0.88%
Wellington     -1.84%   -22.30%   22.20%    7.14%    -0.14%    -0.05%
STAR           -3.14%   -25.10%   24.85%    8.03%    -2.15%    -0.72%
Newsletter CG  -5.50%   -33.60%   29.10%    6.80%   -13.48%    -4.71%
LS MG          -2.73%   -26.50%   20.33%    9.48%    -5.81%    -1.98%
                     
Wellesley      -0.68%    -9.84%   16.02%    9.98%    14.26%     4.54%
LS CG          -1.36%   -19.52%   17.06%    8.90%     1.19%     0.40%
Newsletter Inc -3.72%   -24.10%   21.90%    8.80%    -3.09%    -1.04%
                     
madsinger      -4.91%   -28.85%   26.90%   11.66%    -4.13%    -1.40%

[Beagler]

Coffeehouse continues its strong performance. Kudos.

[Beagler]

Compare Coffeehouse with VG TR 2015 (both about 60/40); the latter has posted respectable returns, though less than Coffeehouse with admittedly less risk: http://tinyurl.com/ye8jvf9

Good going Mr. Schultheis.

[Elysium]

Brad, thanks for posting the numbers, always interesting to see how various portfolio have performed on a real time basis.

My portfolio is up 12.70% YTD as of 10/31. I don't own REIT or PME, instead I have a very high allocation to EM.

Overall 25% US Equity, 50% Foreign Equity, and 25% Fixed Income. Almost 25% of equity (20% of total portfolio) is in EM including 5% EM Small which has done really well this year. I also have 5% of Fixed Income in EM Bonds, again it has done really well this year.

I know my portfolio is very different and may be riskier, but not anymore riskier than portfolios with REIT / PME, only different. I chose to get returns from high allocation to EM and then I tone it down with Large Cap heavy allocation on US / Developed Foreign and 20% High Quality Fixed income.

[livesoft]

I would like to remind folks that the Coffeehouse portfolio is a slice-and-dice portfolio tilted to small-cap and value.

[madsinger]

I would like to remind folks that the Coffeehouse portfolio is a slice-and-dice portfolio tilted to small-cap and value.

True, livesoft.

I would even say "heavily" tilted to small. The 50% US stock allocation to "small" is a very heavy "tilt" compared the "total market". Again, depending on you how define "small", the percentage of the total market that is "small" is only 10% to 25%. So a 50% allocation of US stocks to small is a big "bet".

FWIW, the madsinger portfolio US allocation looks much closer to the coffeehouse (big bet on small and value) than the total market.

-Brad.

[livesoft]

As a small-and-value tilted slice-and-dicer myself, I appreciate these monthly reports. It's all about asset allocation.

[pkcrafter]

Hi Brad,

I just wanted to thank you for continuing to provide this data. I always find it interesting. If you still have the first date you produced the returns, it would be very interesting to see them. If not that, then as far back as you have.

best,

Paul

[madsinger]

Hi Brad,

I just wanted to thank you for continuing to provide this data. I always find it interesting. If you still have the first date you produced the returns, it would be very interesting to see them. If not that, then as far back as you have.

best,

Paul

Here's a link to the Morningstar boards from June 2004. I don't know how useful it is to you, but I think it may be my first post on the matter!

http://socialize.morningstar.com/NewSoc ... ID=1674372

-Brad.

[Random Musings]

Looking backwards, the best thing one could have done over the past 3 plus years (in theory, anyway) was to short the Cold Hands portfolio.

RM

[dbonnett]

Since 1999, what have been the Hot Hands funds by year?

[madsinger]

Since 1999, what have been the Hot Hands funds by year?

These are the funds I've been using for these charts. I believe someone sent me the list through 2004 or 2005, and since then, I've tried to determine the fund by selecting the non-sector fund with the best return. Usually, at some point during the year, somebody either confirms the choice, or tells me otherwise. This year, I don't think there was any issue, since Capital Value was BY FAR the top performing Vanguard fund last year.

1999 Growth Index
2000 Cap Opp
2001 Small Cap Value
2002 Selected Value
2003 Global Equity
2004 International Explorer
2005 International Explorer
2006 International Explorer
2007 International Explorer
2008 Growth Equity
2009 Dividend Growth
2010 Capital Value

-Brad.