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The more I think about it, the more interesting this thread is.

 

Berkshire Hathaway has a YTD total return of -10.7%. FFH is -3.6%. And yet I am one of the worst performing people YTD in this thread, because I haven't done double YTD returns so far!

 

There are a larger number of non-USD-base-currency investors on here, so there's a big tailwind for many. Is that the big factor?

 

The thread asked for people making money this year.  So, of course reporting is lop-sided.  I'm negative for the year after the recent downturn.

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Up 80%+, 100%+ with deposits. Lucky cloning, concentration and small capital base.

 

Who are you cloning to be up 80% this year?

Almost exclusively packer on the board and some well-known managers but they weren't the reason I was up so much. Most of packer's ideas land in the too hard pile like any other ideas from here and elsewhere, think commodity related etc (although oil & gas is getting so tempting to bet on a rebound, especially when you are up a lot in a short period).

But some like ntls and intralot I really liked and betted a lot on. For intralot I also saw chou holding, it's cheap and very hated. In january I was holding inyralot with a big loss because of the greek stock market decline and in that period I doubled down making it a huge position. Ntls just like intralot I traded a little and that added a lot of return. I did miss out on an even bigger gain when selling part of it right before the news broke. Given the rumor that the FT reported I was surprised the stock got so low and not more people invested heavily. Maybe that's just me. I think in hindsight I could have bought more without sweating it and probably should have.. With intralot the dynamic was the same: sell-off had little to do with fundamentals and you have to grap those opportunities. See bac a few years back etc. All also had great investors (ntls also had pe on board) buying at much higher prices and they temporarily got hit by something else than fundamentals.

 

So a lot came down to feeling comfortable with the right ideas to clone and invest heavily and lucky timing. I think a lot of it depends on being able to take a beating too. In january I didn't feel too happy with 40%+ in intralot! I probably oversized that one but when your net worth is low you can't really compare with those that invest millions...

 

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I should also add that I started from a low basis given that 2014 was lousy and down for me so that skews the result of course.

 

I would expand on why I clone and why it happened to be packer that I cloned so often but I'm travelling and don't have time to write all of this down on a smartphone.

 

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It will be helpful if the folks posting their returns also post if the returns are on >1MM invested or not. This is helpful because as another poster posted that it's easy to generate high returns on a small invested amount. However, it gets harder when the invested sum is large.

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Guest Schwab711

It will be helpful if the folks posting their returns also post if the returns are on >1MM invested or not. This is helpful because as another poster posted that it's easy to generate high returns on a small invested amount. However, it gets harder when the invested sum is large.

 

I don't think the size of the bankroll should be the sole determinant of whether the returns are relevant or not. If your returns come from OTC or illiquid stocks then the associated returns are probably not relevant to large bankrolls. If you have a small bankroll but your returns come from BRK, V, and MA then it's basically relevant to everyone (VRX is Sequoia's biggest holding so it's not fair to dismiss small bankrolls that hold it). Judging the relevancy of returns seems more useful on a case-by-case basis.

 

There are also some advantages to having $1m vs. <$100k, depending on how active or aggressive you are. You can make tender offers to pick up illiquid shares while still having an advantage gaining board seats or suggesting capital allocation of smaller companies. With a small bankroll, my suggestions are often dismissed before they are even considered. I can think of a few investments that I think would generate higher long-term returns (without the burden of returns being dictated by market moves in illiquid stocks) if you could afford to buy the whole company, even if you assume an up-front premium of ~50%, because you can control future reinvest decisions. Tim Erickson was able to potentially realize value that small investors had to pass on. It goes both ways and that's what makes this thread potentially interesting.

 

It's not as if 20%+ returns are easy at any size bankroll. If they were, then take 50%-75% of your $1m in BRK or the like and use the remaining amount to earn the easy 20% returns. Most folks would probably realize higher overall returns with that method, right?

 

Right now, I think it would be more efficient to invest with $1m as opposed to $100k and $100k v. $10k, in most cases. The difference seems more relevant between $10m and $1m then $1m and $100k, in my opinion. Maybe I would feel differently if I had $1m.

 

To add, Packer made an interesting comment once about comparing results to relevant indexes/funds. My results like nice compared to the S&P, but that's probably not a relevant comparison over the past year considering my portfolio. I don't know of any reported funds that invest with my style, but it would be interesting to see if they are also up in a down year. It's entirely possible to beat the S&P over a long period of time while still being mostly lucky just due to your style of investing. If anything, threads like these show how hard it is to evaluate true skill.

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Please read the performance record of Bill Miller before posting your 9 month record.

 

Agree with KC here! A 8.5 month record is laughably short.  My question would be what are you going to do with the information that someone has under/overperformed during such a short time frame. 

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Schwab, I think you are missing an important point. If you are young, have a good job and a small (<$100k) portfolio you are probably investing with an aggressive mindset. Tom was mentioning he had 40% of his portfolio in Intralot. I am pretty sure that if you have a $5m portfolio on which you and your family depend for income you would never, ever make that bet (unless you have the balls of Ericopoly).

 

What I am trying to convey is that portfolio size is actually important because you want to filter out the people who are gambling with a small amount of money and are bragging about their results in this thread (for the record, by no means am I implying Tom belongs in that category - that was probably a bad example).

 

People with a small bankroll are probably taking more risk -> standard deviation of their results is higher -> they are probably overrepresented in this thread. In fact, people using risky (for example, high concentration) strategies are probably overrepresented in this thread, again due to the combination of a high variance of their results and the tendency to post only if one outperforms.

 

Another reason why you should be extremely skeptical about any conclusion inferred from threads such as this one. Not to mention that we are looking at a ludicrous timeframe, as others pointed out.

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Guest Schwab711

Schwab, I think you are missing an important point. If you are young, have a good job and a small (<$100k) portfolio you are probably investing with an aggressive mindset. Tom was mentioning he had 40% of his portfolio in Intralot. I am pretty sure that if you have a $5m portfolio on which you and your family depend for income you would never, ever make that bet (unless you have the balls of Ericopoly).

 

What I am trying to convey is that portfolio size is actually important because you want to filter out the people who are gambling with a small amount of money and are bragging about their results in this thread (for the record, by no means am I implying Tom belongs in that category - that was probably a bad example).

 

People with a small bankroll are probably taking more risk -> standard deviation of their results is higher -> they are probably overrepresented in this thread. In fact, people using risky (for example, high concentration) strategies are probably overrepresented in this thread, again due to the combination of a high variance of their results and the tendency to post only if one outperforms.

 

Another reason why you should be extremely skeptical about any conclusion inferred from threads such as this one. Not to mention that we are looking at a ludicrous timeframe, as others pointed out.

 

I get what you are saying, I just don't agree with you. Using your example of a $5m portfolio with my current family situation (single guy, no steady girlfriend, and I better not have any kids in 9-12 months). So I probably would take on bets of ~40% allocation with that amount of money and probably more than I currently do. It's not like I want to be so concentrated all the time and with every bet. When it comes to position sizing, I'd bet age and/or family status plays a much larger role in risk tolerance then the amount of money you have. Which is why it's unfair to blindly dismiss returns of aggressive investors just because you may have kids or the strategy isn't for you. We wouldn't dismiss the results of conservative/diversified investors who lost less than the market in 2008/2009, regardless of their actual underlying performance.

 

So what is a representative time period and how do we determine skill quantitatively?

 

Hope you don't mind some disagreement.

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Schwab, I think you are missing an important point. If you are young, have a good job and a small (<$100k) portfolio you are probably investing with an aggressive mindset. Tom was mentioning he had 40% of his portfolio in Intralot. I am pretty sure that if you have a $5m portfolio on which you and your family depend for income you would never, ever make that bet (unless you have the balls of Ericopoly).

 

What I am trying to convey is that portfolio size is actually important because you want to filter out the people who are gambling with a small amount of money and are bragging about their results in this thread (for the record, by no means am I implying Tom belongs in that category - that was probably a bad example).

 

People with a small bankroll are probably taking more risk -> standard deviation of their results is higher -> they are probably overrepresented in this thread. In fact, people using risky (for example, high concentration) strategies are probably overrepresented in this thread, again due to the combination of a high variance of their results and the tendency to post only if one outperforms.

 

Another reason why you should be extremely skeptical about any conclusion inferred from threads such as this one. Not to mention that we are looking at a ludicrous timeframe, as others pointed out.

 

I did eventually stop but it was at a higher threshold than $5m.  Mostly because BAC just looked like the last time I'd ever have to do it (and I think it was).

 

 

 

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I thought you were claiming alpha is not possible

 

I must have expressed myself badly then. :)

 

What I was trying to say is that alpha may require more than just knowledge of value investing and accounting. There is skill (talent?) factor that might not be easy to learn.

 

Anyway, this is not directly related to this thread.

 

Congrats on good returns.

 

Take care.

 

Jurgis - I want to expand on/restate what I think is your point because it is important (correct me if I am wrong).

 

Forums/Clubs/Twitter that focus on individual security selection do not reveal how good of an investor someone is. Anyone can post a great analysis or have a stock produce >20%, but these have little to do with your portfolio's return. Sizing matters. The other securities in your portfolio matter. Selling in and out the position that produced the handsome gain matter.

 

The tragedy of games of probability and volatility is that poor long term performers will produce spectacular short term results from time to time only to go broke in the long run. This is, in fact, a necessary condition of the game. it keeps the poor performers coming back to be exploited by the better performers. They fool themselves into thinking they just might in fact be winners.

 

This isn't to denigrate this forum (I think it can be pretty good). It's to remind people to be cognizant of the factors of investing that are (necessarily) missed by forums like this.

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Schwab, I think you are missing an important point. If you are young, have a good job and a small (<$100k) portfolio you are probably investing with an aggressive mindset. Tom was mentioning he had 40% of his portfolio in Intralot. I am pretty sure that if you have a $5m portfolio on which you and your family depend for income you would never, ever make that bet (unless you have the balls of Ericopoly).

 

What I am trying to convey is that portfolio size is actually important because you want to filter out the people who are gambling with a small amount of money and are bragging about their results in this thread (for the record, by no means am I implying Tom belongs in that category - that was probably a bad example).

 

People with a small bankroll are probably taking more risk -> standard deviation of their results is higher -> they are probably overrepresented in this thread. In fact, people using risky (for example, high concentration) strategies are probably overrepresented in this thread, again due to the combination of a high variance of their results and the tendency to post only if one outperforms.

 

Another reason why you should be extremely skeptical about any conclusion inferred from threads such as this one. Not to mention that we are looking at a ludicrous timeframe, as others pointed out.

 

I get what you are saying, I just don't agree with you. Using your example of a $5m portfolio with my current family situation (single guy, no steady girlfriend, and I better not have any kids in 9-12 months). So I probably would take on bets of ~40% allocation with that amount of money and probably more than I currently do.

 

Schwab:

 

I agree with writser. We need to know portfolio size and age to draw any conclusions from the posted results (to the extent that it's possible at all).

 

Age, family status and portfolio size are correlated. Compounding takes time to do its magic. Young single guy with a $5m portfolio is an outlier case.

 

Two typical combinations are:

 

young single guy / smallish portfolio / high capacity to take risk

older couple / large portfolio / low capacity to take risk

 

Young guy with a smallish portfolio is much more likely to swing for the fences than an older couple with a large portfolio. Concentrate to build wealth. Diversify to preserve wealth. This is not controversial.

 

 

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Schwab, I think you are missing an important point. If you are young, have a good job and a small (<$100k) portfolio you are probably investing with an aggressive mindset. Tom was mentioning he had 40% of his portfolio in Intralot. I am pretty sure that if you have a $5m portfolio on which you and your family depend for income you would never, ever make that bet (unless you have the balls of Ericopoly).

 

What I am trying to convey is that portfolio size is actually important because you want to filter out the people who are gambling with a small amount of money and are bragging about their results in this thread (for the record, by no means am I implying Tom belongs in that category - that was probably a bad example).

 

People with a small bankroll are probably taking more risk -> standard deviation of their results is higher -> they are probably overrepresented in this thread. In fact, people using risky (for example, high concentration) strategies are probably overrepresented in this thread, again due to the combination of a high variance of their results and the tendency to post only if one outperforms.

 

Another reason why you should be extremely skeptical about any conclusion inferred from threads such as this one. Not to mention that we are looking at a ludicrous timeframe, as others pointed out.

 

I get what you are saying, I just don't agree with you. Using your example of a $5m portfolio with my current family situation (single guy, no steady girlfriend, and I better not have any kids in 9-12 months). So I probably would take on bets of ~40% allocation with that amount of money and probably more than I currently do. It's not like I want to be so concentrated all the time and with every bet. When it comes to position sizing, I'd bet age and/or family status plays a much larger role in risk tolerance then the amount of money you have. Which is why it's unfair to blindly dismiss returns of aggressive investors just because you may have kids or the strategy isn't for you. We wouldn't dismiss the results of conservative/diversified investors who lost less than the market in 2008/2009, regardless of their actual underlying performance.

 

So what is a representative time period and how do we determine skill quantitatively?

 

Hope you don't mind some disagreement.

 

Hi Schwab, I wasn't trying to be dismissive of anyone's great returns. 1MM was also a randomly picked number - I just meant to imply a large portfolio size. With a large portfolio (which is not OPM), taking a highly concentrated bet needs balls of steel (Ericopoly comes to mind. Though it appears that he too became conservative after crossing a certain threshold, I guess at 5MM+.) How to handle a large % decline on a concentrated bet also requires a learning experience (for instance, highly discussed ZINC is down 60%-65%, hold or fold or double down!!!!)  Also, a 10%-20% hit on a large personal portfolio is a large $$$ hit. One needs to learn how to deal with it.

 

Let me highlight a relatively safe way to make ~9% return: NRF or MITT preferreds. The preferreds are senior to the equity in the capital structure which provides a cushion in case shit hits the fan. Dividend is cumulative, so preferred will always get its dividend before the equity gets dividend. Fed will have to raise rates at a very very slow pace (some smart investors are calling for QE4 next year as the next Fed move). This means borrowing cost could remain low. Given where these preferreds are trading at, their yield should not widen more if the long rates go up. Seems like a decent investment. I struggle with position sizing.

 

 

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There are a number of successful investors managing large sums of money that run concentrated portfolios (Mohnish Pabrai). Concentration != gambling

 

Pabrai runs OPM. His investors know what they sign up for. I'm guessing that typical Pabrai investor doesn't go all-in on him. More likely, Pabrai gets a slice of the overall portfolio. The rest of portfolio is invested elsewhere.

 

The typical setup on the forum is very different. Many of us manage our entire family portfolios without outsourcing anything. In my own case, wife and I are in the late forties. Portfolio is large enough to fund a retirement. 40% bet on Intralot?? No frigging way.

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Forums/Clubs/Twitter that focus on individual security selection do not reveal how good of an investor someone is. Anyone can post a great analysis or have a stock produce >20%, but these have little to do with your portfolio's return. Sizing matters. The other securities in your portfolio matter. Selling in and out the position that produced the handsome gain matter.

 

Yes. There are additional factors, but you got the gist.

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Schwab, I think you are missing an important point. If you are young, have a good job and a small (<$100k) portfolio you are probably investing with an aggressive mindset. Tom was mentioning he had 40% of his portfolio in Intralot. I am pretty sure that if you have a $5m portfolio on which you and your family depend for income you would never, ever make that bet (unless you have the balls of Ericopoly).

 

What I am trying to convey is that portfolio size is actually important because you want to filter out the people who are gambling with a small amount of money and are bragging about their results in this thread (for the record, by no means am I implying Tom belongs in that category - that was probably a bad example).

 

People with a small bankroll are probably taking more risk -> standard deviation of their results is higher -> they are probably overrepresented in this thread. In fact, people using risky (for example, high concentration) strategies are probably overrepresented in this thread, again due to the combination of a high variance of their results and the tendency to post only if one outperforms.

 

Another reason why you should be extremely skeptical about any conclusion inferred from threads such as this one. Not to mention that we are looking at a ludicrous timeframe, as others pointed out.

 

I get what you are saying, I just don't agree with you. Using your example of a $5m portfolio with my current family situation (single guy, no steady girlfriend, and I better not have any kids in 9-12 months). So I probably would take on bets of ~40% allocation with that amount of money and probably more than I currently do. It's not like I want to be so concentrated all the time and with every bet. When it comes to position sizing, I'd bet age and/or family status plays a much larger role in risk tolerance then the amount of money you have. Which is why it's unfair to blindly dismiss returns of aggressive investors just because you may have kids or the strategy isn't for you. We wouldn't dismiss the results of conservative/diversified investors who lost less than the market in 2008/2009, regardless of their actual underlying performance.

 

So what is a representative time period and how do we determine skill quantitatively?

 

Hope you don't mind some disagreement.

 

First of all, by no means did I want to imply that investors running a concentrated / aggressive portfolio are gamblers. I'm just talking statistics.

 

People with a small portfolio are on average young. Young people can afford to run a high-risk, high-reward portfolio. Again, I'm not saying that is a bad thing - it is probably their best strategy. But that does imply that the variance of their results is higher. And thus, that they are more likely to 'run hot' in a short timeframe. And thus, that they are more likely to be up 20% and post that in this thread. Compare that to a retired couple with a bond portfolio: they would never reach the required hurdle to post in this thread. In other words, the young people (and thus the small portfolios) posting in this thread are more likely 'just lucky' due to this selection bias. If you look at it that way, portfolio size is a proxy for investing acumen. A very bad proxy, but still useful imho. It's nothing personal - just statistics.

 

With regards to a time period: I don't know most posters here so I can't verify their track records anyway. I mostly try to focus only on the quality of their analysis. That's why I think threads such as this one are a distraction - they put you in a mindset where you think "whoah this guy made 40% this year I better copy his strategy" instead of "he posts sensible stuff about XYZ, I have to look into that". That's dangerous, especially because the selection bias I just described makes it very easy to think you are being too conservative.

 

Anyway, it's all getting a bit philosophical :) .

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My results have been pretty good this year, actually. My public equity portfolio's value is up about 17.12%, despite the fact that I've made net withdrawals of 4.2% so far this year. I don't care to run the numbers on it exactly, but suffice to say it has crushed the market. This is despite Wayfair's recent downturn.

 

For the record, I have 14 non-negligible positions, most of which are pretty evenly sized.

 

My non-publicly traded equity portfolio has also done well, so... yeah. Pretty good year over here. :)

 

 

EDIT: Changed "private equity" to "non-publicly traded equity" to avoid confusion.

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I'm having a pretty rough year. Was in EM pretty heavily before this year given the attractive relative valuation to the U.S. Have been double-whammied by currency and equity movements. Have been doubling down on many positions that trade at sizeable discounts to book, single digit P/Es, and attractive dividend yields, but this probably won't help performance this year.

 

Was also in Europe pretty heavily starting in 2013 and been building ever since. The devaluation of the euro relative to the dollar over the last 15 months hasn't been kind to me and most of the positions are down significantly from their highs - mostly due to currency fluctuations as most of the businesses are better than they were 15 months ago.

 

Started building some significant positions in commodity companies (energy and coal related, mostly) back in March when panic was seemingly at its highs. Some of these have held up alright, but many of them have taken considerable unrealized losses. Selling regular options against the positions has helped limit the losses, but this portion of the portfolio is down about 15-20% in just the past 6 months and is significantly off its highs (+20-30% about 6-8 weeks after the positions were initiated).

 

The few stocks U.S. companies I own have been hit by idiosyncratic risks: Fairfax is down significantly from the beginning of the year (and it's highs) and Whole Foods has collapsed a good bit. Was fortunate to be able to sell my U.S. equity puts at a nice gain though given the market action in the last few weeks.

 

Basically, if you want to make a quick buck, you could probably do the opposite of what I've been doing and have some pretty good results. :)

 

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I'm having a pretty rough year. Was in EM pretty heavily before this year given the attractive relative valuation to the U.S. Have been double-whammied by currency and equity movements. Have been doubling down on many positions that trade at sizeable discounts to book, single digit P/Es, and attractive dividend yields, but this probably won't help performance this year.

 

Was also in Europe pretty heavily starting in 2013 and been building ever since. The devaluation of the euro relative to the dollar over the last 15 months hasn't been kind to me and most of the positions are down significantly from their highs - mostly due to currency fluctuations as most of the businesses are better than they were 15 months ago.

 

Started building some significant positions in commodity companies (energy and coal related, mostly) back in March when panic was seemingly at its highs. Some of these have held up alright, but many of them have taken considerable unrealized losses. Selling regular options against the positions has helped limit the losses, but this portion of the portfolio is down about 15-20% in just the past 6 months and is significantly off its highs (+20-30% about 6-8 weeks after the positions were initiated).

 

The few stocks U.S. companies I own have been hit by idiosyncratic risks: Fairfax is down significantly from the beginning of the year (and it's highs) and Whole Foods has collapsed a good bit. Was fortunate to be able to sell my U.S. equity puts at a nice gain though given the market action in the last few weeks.

 

Basically, if you want to make a quick buck, you could probably do the opposite of what I've been doing and have some pretty good results. :)

 

Sounds like you're having one of those years. I've had them, and it sucks.

 

What you have to wonder is: Are you having bad luck despite a good investing process, or do you need to rethink your approach?

 

Personally, I ended up rethinking my approach.

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I'm having a pretty rough year. Was in EM pretty heavily before this year given the attractive relative valuation to the U.S. Have been double-whammied by currency and equity movements. Have been doubling down on many positions that trade at sizeable discounts to book, single digit P/Es, and attractive dividend yields, but this probably won't help performance this year.

 

Was also in Europe pretty heavily starting in 2013 and been building ever since. The devaluation of the euro relative to the dollar over the last 15 months hasn't been kind to me and most of the positions are down significantly from their highs - mostly due to currency fluctuations as most of the businesses are better than they were 15 months ago.

 

Started building some significant positions in commodity companies (energy and coal related, mostly) back in March when panic was seemingly at its highs. Some of these have held up alright, but many of them have taken considerable unrealized losses. Selling regular options against the positions has helped limit the losses, but this portion of the portfolio is down about 15-20% in just the past 6 months and is significantly off its highs (+20-30% about 6-8 weeks after the positions were initiated).

 

The few stocks U.S. companies I own have been hit by idiosyncratic risks: Fairfax is down significantly from the beginning of the year (and it's highs) and Whole Foods has collapsed a good bit. Was fortunate to be able to sell my U.S. equity puts at a nice gain though given the market action in the last few weeks.

 

Basically, if you want to make a quick buck, you could probably do the opposite of what I've been doing and have some pretty good results. :)

 

Sounds like you're having one of those years. I've had them, and it sucks.

 

What you have to wonder is: Are you having bad luck despite a good investing process, or do you need to rethink your approach?

 

Personally, I ended up rethinking my approach.

 

Maybe you can also see whether your YTD results are due to share price fluctuation or an actual impairment in underlying value.

 

I mean even if you're an amazing investor you can't possibly make money every year because stock prices fluctuate a lot more than underlying values. Likewise, for the same reason, some bad investors can outperform the market in the short-run. Over time though, the good investor will prevail. Anyways, long-winded way of saying short-term price fluctuations shouldn't matter.

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I'm having a pretty rough year. Was in EM pretty heavily before this year given the attractive relative valuation to the U.S. Have been double-whammied by currency and equity movements. Have been doubling down on many positions that trade at sizeable discounts to book, single digit P/Es, and attractive dividend yields, but this probably won't help performance this year.

 

Was also in Europe pretty heavily starting in 2013 and been building ever since. The devaluation of the euro relative to the dollar over the last 15 months hasn't been kind to me and most of the positions are down significantly from their highs - mostly due to currency fluctuations as most of the businesses are better than they were 15 months ago.

 

Started building some significant positions in commodity companies (energy and coal related, mostly) back in March when panic was seemingly at its highs. Some of these have held up alright, but many of them have taken considerable unrealized losses. Selling regular options against the positions has helped limit the losses, but this portion of the portfolio is down about 15-20% in just the past 6 months and is significantly off its highs (+20-30% about 6-8 weeks after the positions were initiated).

 

The few stocks U.S. companies I own have been hit by idiosyncratic risks: Fairfax is down significantly from the beginning of the year (and it's highs) and Whole Foods has collapsed a good bit. Was fortunate to be able to sell my U.S. equity puts at a nice gain though given the market action in the last few weeks.

 

Basically, if you want to make a quick buck, you could probably do the opposite of what I've been doing and have some pretty good results. :)

 

Sounds like you're having one of those years. I've had them, and it sucks.

 

What you have to wonder is: Are you having bad luck despite a good investing process, or do you need to rethink your approach?

 

Personally, I ended up rethinking my approach.

 

Yea - I've ended up changing something every time this happened in the past. It's years like this that drove me to set position limits for myself and to do my buying/selling activity in multiple steps instead of all at once.

 

I'm not sure that this year will result in that though. I believe the long-term numbers that show currency hedging is a wash in the long-run and I don't fancy the idea of limiting my exposure to a diversified and increasingly idiosyncratic asset class like EM that is offering value just because I already have a lot of exposure. I think this year was largely one where it was more of a coincidence that everything I bought went down and less of a problem with the process. I mean, the things that drove Whole Foods down is different than what is driving Fairfax down which is different than what caused the recent drops in Outerwall which is different than what is driving the value of the euro which is different than what is affecting EM companies.

 

Looking back, I might have reduced my how much I allocated to commodity companies back in March  given my exposure to EM which would be correlated, but that might be the only thing I'd do differently. The year isn't over yet and I'm not quite willing to say that EM and commodities were bad choices just because of one year of tough performance. I'm not managing money for anyone else so it's easier for me to stomach a bad year.

 

 

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