Thanks for sharing this.
I've been grappling with my under performance and how to correct this, so let me share too.
My performance from last year was 25.5%.
Obviously below the S&P return last year, which I had as 29% (you had as 32.4%).
So I've been thinking about ETFs, managed funds and how to boost portfolio performance.
I wanted to mention this and see what ideas others might have on it.
I've hoped that I could spot stocks that will exceed the market.
I seem to be better at this in lackluster markets than I do in a bull like we had last year.
It seems that stocks I thought offered value didn't move with the market and my coverage didn't include market sectors where returns were outsized last year. For instance the S&P (not the S&P 500) Biotech segment returned 49% last year.
In particular in a market that is rising across the board, but rising unequally, it's difficult to be in the right place with individual stocks.
In my case just a S&P 500 ETF would not have been de-worse-ification, since it did a few % points more.
And if I had been 1/2 s&p 500, 1/4 dow, 1/4 small cap I would really have been happy.
The one year return (1 year not 2013 return) for these are 32% (SPY), 29% (DIA), 145% (TNA) which would have pushed the portfolio return up to near 60%.
This shows you how important asset allocation is.
What if I had done 1/2 s&p 500, 1/4 biotech, 1/4 small cap because I identified these as good momentum sectors.
32% (SPY), 65% (IBB or BBH), 145% (TNA) - over return near 69%.
Of course it's just a case in point - maybe I'd pick TNA this year and it's return will be crappy and reduce the overall return. But I'm just wondering to myself whether this isn't a strategy to use in a strong market ...
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