![]() ![]() My hope is that these 20+ other stocks help to expand your horizon of investment-quality companies. This series isn’t intended to tell you what to buy, but rather to show you how I approach individual security analysis, portfolio construction, and long-term investment strategy. After 9 years of analyzing stocks & the market, I’ve built an extensive library of companies that I love. In the final version of this series, set to be published on Wednesday, November 29th, I will share 20+ different stocks that didn’t make the cut in this 15-position portfolio. I can’t stress this enough: they are proven winners, and I believe that they will continue to be winners (in terms of operating performance & generating shareholder value). Source: Fidelity Past performance Since inception in November 2006, VYM has lagged the S&P 500 by 1. The majority have outperformed the S&P 500 on a 3, 5, 10, and 20 year basis. Management teams have steered their companies through a variety of economic conditions. The majority pay a dividend and/or offer a substantial share repurchase program. They have the track record to prove it.Īll of these companies are profitable. Once we transition into an unequivocal bull market, I expect these investments to compound much faster than the S&P 500. For context, the S&P 500 is up +14.2% since the mid-October lows, meaning that 80% of the stocks/ETF’s above are outperforming the broader market within the latest uptrend. These are high-quality stocks & ETF’s that I have long-term conviction in however, they also provide dynamic short-term returns. Since their respective YTD lows, which broadly occurred in mid-October, here are the returns for each position in this highly efficient portfolio: Each parameterization is evaluated with 100,000 simulations of monthly returns for the evaluation window. On net, the 15 individual stocks & ETF’s within this portfolio have performed extremely well and erased substantial YTD losses. the maximum drawdown statistic for our baseline case: 10-year time window, 10 annualized volatility, and 0.5 annualized Sharpe ratio. By doing so, they allow the fund’s portfolio managers, investment analysts, and natural market cycles to control the strategy and individual stock allocations. They are extremely beneficial for passive, long-term investment strategies, allowing an investor to steadily increase their exposure to hundreds of companies simultaneously. ![]() ETF’s are a powerful tool, allowing investors to diversify into specific investment factors, themes, sectors, and industries. In this report, I’ll be explaining the qualitative investment thesis & portfolio strategy of 5 exchange-traded funds (ETF’s). Welcome to the second-to-last edition of “What I’m Buying & Why”, an exclusive series for paid members that I launched in early September! At this point in the series, we’ve covered 10 individual stocks, breaking down the qualitative investment thesis, financial performance, and shareholder return of each company. ![]()
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