Re: YOUNG FOLK PORTFOLIO -- PERFORMANCE RESULTS
I have had a few people tell me they don't know how to interpret the results of this portfolio. Let me attempt to explain how I manage this portfolio.
I do not measure the success or failure of this portfolio based on how it performs against the S&P 500 or any other benchmark. This portfolio has its own very specific performance goals and those goals are my only benchmark.
Where some people prefer to talk about per-cent, I prefer to talk about dollars and cents so dollars and cents is how I break down my portfolio goals for this account.
I break my long-term goals down into two parts - portfolio value and dividend cash flows.
PORTFOLIO VALUE:
Objective ... $3MM portfolio value using monthly deposits for 40 years of $500 for an 8.25% compounded annual rate of growth with an initial amount of $42,205.
This portfolio switched over to dividend growth investing at the end of 2009 so year 1 is 2010.
Here is what the portfolio value needs to be at the end of every year and then what has actually occurred.
...... Year ... Objective ... Result
2009 ........................... $42,205
2010 ... $52,053.79 .... $54,949.87
2011 ... $62,746.55 .... $70,221.20
2012 ... $74,355.59 .... $84,710.60
2013 ... $86,959.44 .... $111,161.93
2014 ... $100,643.33 .. $136,286.91
2015 ... $115,499.83 .. $144,167.64
2016 ... $131,629.41 .. $168,698.83
2017 ... $149.141.17 .. $201,380.29
2018 ... $168,153.55 .. $204,167.06
2019 ... $188,795.15 .. $269,647.00
2020 ... $211,205.56 .. $304,941.90
2021 ... $235,536.37 .. $368,625.48
Going forward:
2022 ... $261,952.15
2023 ... $290,631.54
2024 ... $321,768.53
Those results include the $500 monthly contribution and no other outside funds.
Now, I don't know how people want to judge results but if I use the calculator below and run the starting portfolio value vs the ending portfolio value, based on what years you want to count I come up with:
CAGR 12 years - 19.79%
CAGR 13 years - 18.14%
cagrcalculator.net
But again, what's important to me are those dollar and cents numbers and making sure I stay ahead of schedule in achieving them.
DIVIDEND CASH FLOWS:
Objective - Starting annual dividend amount was $684.00 and in 40 years I want $120,000 in annual dividends and that will take a CAGR of 13.8%
...... Year ... Objective ... Result
2009 .......................... $684.00
2010 .... $778.39 ....... $1,693.33
2011 .... $885.81 ....... $2,404.02
2012 .... $1,008.05 ... $2,808.46
2013 .... $1,147.16 ... $3,365.47
2014 .... $1,305.47 ... $4,116.29
2015 .... $1,485.63 ... $6,093.77 **
2016 .... $1,690.64 ... $4,458.14
2017 .... $1,923.95 ... $4,873.73
2018 .... $2,189.46 ... $5,855.54
2019 .... $2,491.60 ... $6,042.08
2020 .... $2,835.44 ... $6,901.84
2021 .... $3,226.73 ... $7005.33
** Year 2015 included a large special dividend from KHC in the amount $1,535.64.
Going forward:
2022 ... $3,672.02
2023 ... $4,178.76
2024 ... $4,755.43
Again, using the same calculator:
CAGR 12 years - 21.4%
CAGR 13 years - 19.6%
cagrcalculator.net
Both portfolio value and dividend cash flows are well ahead of schedule based on the objectives I have established. |
