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Investment Analysis Clubs / 2005 Retirement Inv. Challenge


Subject:  Re: Time for prizes Date:  8/6/2006  12:55 PM
Author:  basilkruglov Number:  400 of 418

Like blackjs, I too did not time to track and update my portfolio; according to my rough estimate, my end results are quite terrible :(

annualized return is about -3.02% vs. S&P 500 which is +7.99% (annualized); or -11.02% in comparison.

top 5 best positions are:
1. deck 73.28%
2. aph 39.86%
3. hydl 28.83%
4. mcd 26.01%
5. mo 21.74%

top 5 worst positions are:
1. mrh -48.88%
2. mpx -42.43%
3. faro -39.31%
4. intc -33.90%
5. gtrc -32.98%

Few lessons learned

1. small cap exposure should (or must) be limited for retirement type of portfolios. One should not rely on small caps unless you have a significant experience in that area. Investing in small caps requires to be very focused.

2. I also believe that for retirement, one's portfolio should be composed of dividend paying stocks with limited downsize, i.e. those that were purchased at a significant discount (at least to their historic valuations)

3. volatility is not a friend of someone who is retired or about to retire; one would need a strong stomach / stamina to take it -- retirement should be fun, not a mind/stomach torture. These stocks my recover and perhaps produce phenomenal results, but over longer, or perhaps much longer period of time. Investment horizon of a retired individual is way different.

4. ETFs tracking major indices should do just fine, they take off the pressure of having to choose individual stock holdings.

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