CapitalTime
Articles on investing and capital management, with a quantitative focus.
Growth Portfolio 6 Month Update
2019-06-19
My growth portfolio outperformed the TSX by several percent in this time period, continuing to show strong performance since inception 2.5 years ago.
All positions are equal weight. After today's adjustments, the current portfolio is:
| Stock Symbol | Company Sector |
|---|---|
| EMP.A | Consumer |
| BYD.UN | Consumer |
| CP | Industrial |
| WCN | Industrial |
| GIB.A | Technology |
| CSU | Technology |
| QBR.B | Media |
| BAM.A | Financials |
| KL | Materials |
The dividend yield of the portfolio is 0.8%
Performance
The Lifetime CAGR (compound annual growth rate) since inception is 11.6%, compared to the benchmark XIC at 5.9%.
Performance is calculated for each time period shown, in between portfolio updates. I use actual fill prices if there was a trade, or the bid price otherwise. Trade fees are ignored. The XIC return includes dividends, but the Growth return does not, since they are quite small.
| Start | End | Growth | XIC |
|---|---|---|---|
| 2016-12-28 | 2017-06-19 | 15.0% | 0.7% |
| 2017-06-19 | 2017-12-27 | 2.6% | 7.2% |
| 2017-12-27 | 2018-06-18 | 4.9% | 2.5% |
| 2018-06-18 | 2018-12-17 | -11.6% | -10.3% |
| 2018-12-17 | 2019-06-19 | 20.1% | 16.1% |
| Lifetime CAGR | 2.5 years | 11.6% | 5.9% |
Note that the first time period accounts for the entire outperformance of Growth versus XIC. If one ignores the first time period, Growth performs about the same as XIC. To be more confident in this portfolio, I would need to see more time periods where Growth outperforms XIC.
Cautions
The broad stock market has been incredibly strong for the last few years, so it's not surprising that growth stocks performed well. The big question is: what happens when stocks weaken or enter a bear market?
I will keep evaluating my portfolio against the XIC benchmark. There is a danger that my growth stocks could perform significantly worse than XIC during a downturn in stocks.
A track record of 5+ years will be needed before I can conclude that my portfolio is doing well. Short term results might simply be random and meaningless.