Author Topic: CoBF members 2019 returns  (Read 17330 times)

Munger_Disciple

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Re: CoBF members 2019 returns
« Reply #50 on: January 05, 2020, 11:25:34 AM »

Hielko - not terribly surprising.  I think there are two reasons:

1) The average stock underperformed the big market-cap weighted indices (the FAANG influence).  I would guess the COB&F stock pickers are value pickers and generally are underinvested in FAANG. 

One way I measure the annual return of the average stock is to take a squint at the Wilshire Equal-Weight Indices.  The Wilshire Equal-Weight 5000 Index had a 28.9% return in 2019 (vs 31.05% for the S&P 500 Total Return).  So basically a bunch of monkeys throwing darts at the WSJ stock pages underperformed the S&P but still edged out the average COB&F value investors in 2019 by the looks of the self-reported survey.

2) The other factor that I think comes into play is BRK's underperformance.  Just like the COB&F value investors are underinvested in FAANG, they are probably overinvested in BRK and BRK underperformed the indices by a lot this year (e.g., BRK-B had a 10.9% annual return vs 31.05% for the S&P 500 TR).

wabuffo

Good points. Not a big deal, but minor correction:  S&P 500 TR for 2019 was 31.49%.


wabuffo

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Re: CoBF members 2019 returns
« Reply #51 on: January 05, 2020, 12:04:22 PM »
Not a big deal, but minor correction:  S&P 500 TR for 2019 was 31.49%.

Yes - you are correct.  Sorry about that, I had an error in my spreadsheet.  Thanks for pointing it out!

wabuffo

John Hjorth

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Re: CoBF members 2019 returns
« Reply #52 on: January 05, 2020, 12:30:53 PM »
Related to Wabuffo's post # 48, we had a poll about a year ago - actually on January 9th 2019 - which documented that a large part of the active voters in that poll was Berkshire investors, and then again a quite large part of the voters with large amounts of capital [as percentage] allocated long Berkshire.

At least to me personally, it's quite clearly documented by many of those investors here on CoBF [observed by reading their posts - simple as that], that the orientation and line of thinking among those board members is truly long term. It's to me also evident, that at least a part of those board members are accumulating Berkshire shares on an ongoing basis [as net savers].

So they may have taken this poll, but they actually don't care about a year of relative underperformance for Berkshire relative to the market [because of long term thinking], perhaps even instead considering it a relative opportunity for accumulation of more shares.
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EliG

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Re: CoBF members 2019 returns
« Reply #53 on: January 05, 2020, 03:10:46 PM »
It's impossible to interpret the poll results without knowing the reporting currencies.

This forum has a sizable Canadian membership. Most Canadian investors I know measure their performance in Canadian dollars. In 2019, Canadian dollar appreciated ~5% vs the US dollar. Currency appreciation creates a performance headwind.

S&P 500 TR for 2019:

* measured in USD: +31.49%
* measured in CAD: +25.2%

Consider a Canadian portfolio that returned, say, +28% in 2019. Without knowing the reporting currency, we can't judge the performance.

+28% measured in CAD means 3% outperformance.
+28% measured in USD means 3% underperformance.

To get more meaningful results next year, require that everyone reports in USD. That means more work for the non-US investors; you may end up getting fewer responses.

rolling

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Re: CoBF members 2019 returns
« Reply #54 on: January 09, 2020, 05:06:12 AM »
2ndhalf 2011 and 2012:  20%
2013: 30%
2014: 50%
2015: less 5%
2016: 50%
2017: 160-170%
2018: 11% (It seems it was 6% if I exclude an year end wuote manipulation, but I will take the 11% because it is easier to do the math and the 2019 return will adust for that)
2019: 0.6% (I had to use 02/01/2020 quote due to year end portfolio movements, return would have been sligtly lower, probably around zero)

Results are in euro, before taxes but after all other costs.

Note: I thought I had lost about 5%... Nothing like a year end review to get morale up

note2: I am now much happier. Portfolio is much cheaper than last year, and it seems I didn't lose money
« Last Edit: January 09, 2020, 05:09:57 AM by rolling »
My usual portfolio: Highly concentrated (up to 3 or 4 positions) in smallcaps and microcaps.

Dynamic

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Re: CoBF members 2019 returns
« Reply #55 on: January 09, 2020, 05:33:52 AM »
2ndhalf 2011 and 2012:  20%
2013: 30%
2014: 50%
2015: less 5%
2016: 50%
2017: 160-170%
2018: 11% (It seems it was 6% if I exclude an year end wuote manipulation, but I will take the 11% because it is easier to do the math and the 2019 return will adust for that)
2019: 0.6% (I had to use 02/01/2020 quote due to year end portfolio movements, return would have been sligtly lower, probably around zero)

Results are in euro, before taxes but after all other costs.

Note: I thought I had lost about 5%... Nothing like a year end review to get morale up

note2: I am now much happier. Portfolio is much cheaper than last year, and it seems I didn't lose money

Wow, that's a great example of "who cares about lumpy returns if you're earning 30%+ annualized on average".

Multiplying your rough returns, you probably turned every €100 into about €1065 over the course of around 8.5 years. That would be about 32% compound annualized return (with a few percent margin of error I imagine, given that the early numbers are very approximate). Also great that you haven't lost money.

rolling

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Re: CoBF members 2019 returns
« Reply #56 on: January 09, 2020, 10:24:25 AM »
2ndhalf 2011 and 2012:  20%
2013: 30%
2014: 50%
2015: less 5%
2016: 50%
2017: 160-170%
2018: 11% (It seems it was 6% if I exclude an year end wuote manipulation, but I will take the 11% because it is easier to do the math and the 2019 return will adust for that)
2019: 0.6% (I had to use 02/01/2020 quote due to year end portfolio movements, return would have been sligtly lower, probably around zero)

Results are in euro, before taxes but after all other costs.

Note: I thought I had lost about 5%... Nothing like a year end review to get morale up

note2: I am now much happier. Portfolio is much cheaper than last year, and it seems I didn't lose money

Wow, that's a great example of "who cares about lumpy returns if you're earning 30%+ annualized on average".

Multiplying your rough returns, you probably turned every €100 into about €1065 over the course of around 8.5 years. That would be about 32% compound annualized return (with a few percent margin of error I imagine, given that the early numbers are very approximate). Also great that you haven't lost money.
Thank you: had been thinking on doing the math but never actually got myself up to it. You should be roughly right since there is little approximation on those results. Some points:
1) taxes play a big role: over here 28% on dividends and all capital gains.
2) A very small base also masquers those returns
3) a kid at year end 2017 and another in 2019 probably are partially responsible for the last 2 years returns: Perhaps I should have just indexed from then on.

What keeps me now from indexing:
1- multi year high for american stocks
2- high conviction on the cheapness of my current portfolio

My usual portfolio: Highly concentrated (up to 3 or 4 positions) in smallcaps and microcaps.

writser

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Re: CoBF members 2019 returns
« Reply #57 on: January 09, 2020, 10:33:15 AM »
Just got back from vacation, did some administrative work today. 2019 return: 29.05% (in EUR), give or take a few basis points. Returns since I started doing this full-time:

2014: 17.51%
2015: 11.89%
2016: 36.96%
2017: 22.86%
2018: 15.41%
2019: 29.05%

About 22% annualized. Everything in EUR. Numbers might be slightly different than posted in previous years because I made a small retroactive change in how I treat tax credits generated by my portfolio. I only pay a flat wealth tax and use tax credits to offset most of it, so my performance is basically net of taxes. As in previous years, I think my headline number is conservative. I have acquired a nice collection of CVR's, liquidation trusts, escrows, tax refunds and other untradable stuff over the years. My brokers (and thus I, for wealth tax purposes) value most of these assets at cost or zero and in terms of fair value that is too low. In particular, I have a large Sapec tax refund incoming in a few weeks, valued at zero. That should add another ~2% to my performance. And as another example, one of my largest positions this year was IAM.TO. So I have a decent position in the IAM CVR, valued at zero, but I think it is very likely that it is worth significantly more. Anyway, bla bla bla. Just saying that you should take the headline numbers of individual years with a grain of salt. Also, some of my positions are so illiquid that they can swing around 10% or 20% in a single trade.

A bit of reflection: I'm quite happy with how the year went. I'd like to think that I have a reasonably conservative portfolio with not a super high beta. No high-conviction huge positions. Lots of special situations, some deep value stuff, no leverage and usually a 5% - 15% cash position. 50+ positions, very high turnover. Largest individual position < 5% at the moment. Not your typical 'punchcard' portfolio. I'm skeptical about my abilities and like to spread my eggs. That way I don't blow up if I make a few horrible mistakes. Also, it keeps me busy and I enjoy it :) . Long term I'd be extremely happy if my portfolio returns around 10% with a bit less volatility than the market. So far I'm doing way better than that. This year in particular was nice: I don't expect at all to keep up with the market in a year in which it is up ~30% but I managed to minimize the damage. Of course that might mean that I am simply taking way more risk than I am aware of ..

Finally, some highlights this year: I was involved in a few individual trades this year where I am 99.99% sure I generated significant alpha and where that alpha materialized in a few minutes / hours / days. A few of them were very satisfying. Usually it is close to impossible to determine whether you have an edge on the market. Trades like these give me a bit of confidence I'm doing something right. I am very content with my track record in Italian real estate funds (link). The past four years my basket appproach and opportunistic trades in this space generated a >20% IRR with a large sample size. ASFI was a deep-value idea that worked out perfectly this year. ATXI was a very enjoyable and profitable stock to analyse and trade around. Same for SMTA. BMY rights were also very interesting to look at. They appreciated 50% already since the merger close a few weeks ago. A situation I'm going to track closely in 2020. Finally, by far the most enjoyable special situation of 2019 was becoming a father.

And some lows: I underperformed my personal benchmark again .. I'm a bit sloppier and lazier than the benchmark. Also, I'm too stubborn / stupid to analyse / buy stuff that is basically more expensive than net cash. Hemacare, XPel, Viemed, GAN PLC were very solid ideas but I just can't get comfortable with ideas like those. I have owned Hemacare on and off during the past few years (it has been a 100x bagger) but whenever it is up 20% in a few days I sell my position, only to regret it later. I said last year that I should try to improve a bit in that area but I'm basically still an utter bottom-scraper (though up to some point it is also a style difference that I can live with). Something similar happened with ATXI and ASFI this year. My theses were correct, I made some good money but I think I should have been more patient with letting the theses run their course, rather than start selling as soon a a stock is up X%. Something to work on (again) in 2020 .. Also, PACB was only a small position for me but probably one that I entered when I hadn't done my homework as well as the rest of the market. In general I have the tendency to buy small positions too aggressively and size my best ideas too passively. I think sizing is one of the most difficult parts of investing. Another low: I posted a few times in the politics section. Fuck me.
« Last Edit: January 09, 2020, 11:49:02 AM by writser »
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@thewritser

hillfronter83

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Re: CoBF members 2019 returns
« Reply #58 on: January 09, 2020, 11:01:09 AM »
Big congrats on very solid results, especially on the following :):

Finally, by far the most enjoyable special situation of 2019 was becoming a father.


BMY management came out today saying there is very good chance CVR will pay out. The price is approaching "fair value" (75% chance for each drug to get approved, I trimmed some.
https://www.cnbc.com/2020/01/09/reuters-america-bristol-myers-confident-of-approvals-linked-to-higher-celgene-investor-payout-bristol-exec.html


« Last Edit: January 09, 2020, 11:04:43 AM by hillfronter83 »

John Hjorth

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Re: CoBF members 2019 returns
« Reply #59 on: January 09, 2020, 01:00:43 PM »
Finally, by far the most enjoyable special situation of 2019 was becoming a father.

What writser does - and gets away with, somehow always has been a mystery to me! [Congrats to some outstanding returns over the years & congrats on the family extension!]

- - - o 0 o - - -

CoBF is however pretty relentless : Have you looked into : EAC.CPH recently? [Your game!]
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai