With the end of 2022, the second year of the FiveTwenty portfolio experiment is in the books. It is therefore time to look back at how the portfolio has performed compared to the easy-peasy benchmark, and reflect of any new learnings from the second year of operations.
By the numbers
At the end of the first year (2021) and the beginning of the second year (2022), the total value of the FiveTwenty portfolio was trailing that of the easy-peasy benchmark. However, by the end of January 2022 the FiveTwenty portfolio zoomed ahead of the benchmark by 5%. As the domestic and international stock markets continued their decline during the year, the gap between the FiveTwenty and the easy-peasy portfolios widened. The FiveTwenty portfolio ended 2022, 12% ahead of the benchmark.
Overall, as of the end of 12/30/2022, the last trading day of 2022, the FiveTwenty portfolio had a net loss since inception of 0.08%. 17 positions in the portfolio increased in value while 14 positions decreased in value.
In terms of dividend payouts, the FiveTwenty portfolio outpaced the Easy-peasy benchmark in every quarter for the second year in a row. Furthermore, it has also outpaced the quarterly dividend milestones outlined in the strategy description. For the year the portfolio collected $5,997.63 in dividends compared to $3,337.96 for the benchmark and $5,684 estimated. In addition, the portfolio ended the year with a TTM yield on current value of 3.55% and TTM yield on cost of 3.56%.
Some “fun” portfolio facts as of 12/30/2021:
| for a position | highest | lowest |
|---|---|---|
| Value change | 71.56% | (46.79)% |
| TTM dividend yield (on current value) | 7.25% | 1.78% |
| TTM dividend yield (on cost) | 7.30% | 2.47% |
| TTM dividend payout | $588.53 | $62.4 |
| % of portfolio | 4.36% | 1.16% |
Takeaways
Catching the falling knife. When picking the stocks to allocate the weekly investment capital too over the past year one reason came up over and over again. And that the share price decreases provided us with opportunities to increase our holdings at more attractive valuations. For some positions the share price has continued to drop. For others we did manage to add to our positions close to the 52-week bottoms.
Dividend stocks outperformed in a down market. As the year progressed and the stock market dropped lower and lower, the gap between the FiveTwenty and easy-peasy portfolios widened. It was great to see the FiveTwenty portfolio break even while the easy-peasy portfolio lost 12% of its value over the same period. We are now keen to observe how the FiveTwenty portfolio and our investment strategy performs in a prolong up market. With any luck we’ll get to observer that in the next 1-2 years.
Image generated by DALL-E 2