CapitalTime
Articles on investing and capital management, with a quantitative focus.
Performance of Growth Portfolio
2020-12-28
This is the 4 year anniversary of my Growth portfolio, and I’m going to review the performance of my stock picks versus the benchmark, Canada’s XIC (TSX Composite).
Trading fees are ignored. The XIC return includes dividends, but the Growth return doesn’t; the dividends are negligible anyway.
Performance numbers are compounded annual growth rate (CAGR). The 2 year data is not available.
| Time Period | Growth, CAGR | XIC, CAGR |
|---|---|---|
| 1 year | 20.5% | 6.2% |
| 3 years | 12.6% | 6.1% |
| 4 years | 13.9% | 6.9% |
The current portfolio is shown here.
Analysis
So far, these results look promising. Over the full 4 year period, my Growth portfolio has outperformed XIC by 7% per year. I have also outperformed over the shorter time periods.
On the other hand, these results do not conclusively show that my stock-picking can consistently beat the index. These growth stocks are very volatile and their movements can be quite wild. I have seen some tremendous gains since this summer, but they can just as easily have tremendous losses.
The results do look good at the moment. I will continue with this experimental stock-picking! This Growth portfolio is 3% of my overall investments, replacing part of the Canadian index shown in my asset allocation.
— Jem Berkes