In another thread, someone asked of me a question that needs no reply. Didn't you bid this board adieu not that long ago? To which, I’ll borrow Keynes’ reply when asked a similar question. “When the facts change, I change my opinion. What do you do, Sir?” For nearly three years now, I’ve been saying that the opportunities in bonds are becoming fewer. But my own buying contradicts that. In 2009, I added about 60 new positions, about the same in 2010, and double that in 2011. This year, already, I’ve added another 22 new positions (and sold 10 old ones). So, obviously, I’m still finding things to do. But that wasn’t my intention for this year. This year, rather than just talk about it, I was going to start rotating effort and money into another asset-class. But the need to maintain the portfolio I’d already built keeps dragging me back into bonds. As I mentioned in another thread, these were my 10-year results: as 12/31/11 1yr 3yr 5yr 10yr SP500 2.11% 14.11% -0.25% 2.92% (a common index of US large caps) EAFE -12.14% 7.65% -4.72% 4.67% (a common index of foreign large caps) AGG 7.84% 6.77% 6.50% 5.78% (a common index of US bonds) BRK-B -4.76% 5.88% 0.80% 4.21% (Buffet's value fund) Charliebonds 10.22% 20.80% 7.35% 8.17% (a non-public, fixed-income, value fund) A 10-year average return of 8.17% is tiny money, and it is barely half of my 27-year record, which is a more respectable, annually-compounded 16.0%, which shouldn't be surprising to anyone. The '80's and '90s were easy-money years, when throwing darts could make an investor 25%-30%. Nowadays, 8% is closer to what markets are offering. But that's still easy money that I’m unwilling to walk away from just because I was getting bored with the gig and/or had mistakenly anticipated its end. So, yes, the persona that I created has departed, and “Charliebonds” is no more. But the investor/trader/writer who created his returns is still alive, well, and pulling as much money as ever out of the bond market. So I’ll make this offer to each and everyone of you. If you can make a useful, substantive contribution to any thread I create (using whatever persona I choose), please feel free to join in on the conversation. I'm very good at what I do, and my threads on this board offer an over-the-shoulder look at the challenges (and rewards) of running a mid-sized, all-bond portfolio that invests "across the yield-curve and across the credit-spectrum" that is rare to encounter anywhere on the internet. If that narrow, investing niche is not a topic that interests you, then you shouldn't be reading it. Charlie
as 12/31/11 1yr 3yr 5yr 10yr SP500 2.11% 14.11% -0.25% 2.92% (a common index of US large caps) EAFE -12.14% 7.65% -4.72% 4.67% (a common index of foreign large caps) AGG 7.84% 6.77% 6.50% 5.78% (a common index of US bonds) BRK-B -4.76% 5.88% 0.80% 4.21% (Buffet's value fund) Charliebonds 10.22% 20.80% 7.35% 8.17% (a non-public, fixed-income, value fund)
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