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Asset Allocated Stock Selections
live (public) 0.90% October 19
Does Asset Allocation and
Stock Picking Mix?
We have been measuring a number of different stock selections
recommended by a number of different pundits. These selections have
been measured against a portfolio of dividend bearing ETF's and we
have seen a variety of results.
Our major thesis has been that asset allocation is key and that
doesn't just mean allocating assets across US companies -- it
includes worldwide equities, real estate and commodities.
| Fund in this portfolio | Asset Category |
|---|---|
| GLD (SPDR Gold Shares) | Commodity |
| DBC (PowerShares DB Commodity Index Tracking) | Commodity |
| CMG (Chipotle Mexican Grill, Inc.) | US Equity |
| SBUX (Starbucks Corp.) | US Equity |
| WMT (WalMart) | US Equity |
| JNJ (Johnson Johnson) | US Equity |
| DIS (Disney) | US Equity |
| NLY (Annaly Capital Management) | Real Estate |
| TEF (Telefonica SA ADRg) | International Equity |
| PTR (PetroChina Co. Ltd. (ADS) | Emerging Market Equity |
- GLD -- a proxy for gold to provide a hedge for troubled times, the permanent portfolio has used this very effectively
- DBC to give access to a broad basket of commodities that are going to be a feature of our world with inflation and growing competition for resources
- Chipotle is part of the MacDonalds family that is seeing growth and popular with its approach to food selection
- Starbucks has worldwide presence and is woven into life
- WalMart, Johnson and Johnson and Disney are long term high quality stocks
- Annaly Capital Management gives access to real estate
- Telefonica and PetroChina give access to long term international markets
It's important to note that these are not particular recommendations. The purpose of this article is to investigate the impact of selecting long term equities with a focus on asset allocation. Each one of these could be replaced with others you prefer in a category. There is also room to increase the amount of international and emerging market exposure. However, US equities have known oversight and rules which some other markets may not.
| Asset | Fund in this portfolio | Price change* | Percentage |
|---|---|---|---|
| Asset1 | GLD (SPDR® Gold Shares) | 1.34% | 4.36% |
| Asset1 | DBC (Invesco DB Commodity Index Tracking Fund) | 0.04% | 1.97% |
| Asset1 | CMG (Chipotle Mexican Grill Inc) | 1.09% | 48.71% |
| Asset1 | SBUX (Starbucks Corporation) | 1.62% | 10.91% |
| Asset1 | WMT (Walmart Inc) | 0.28% | 7.27% |
| Asset1 | JNJ (Johnson & Johnson) | 0.80% | 6.99% |
| Asset1 | NLY (Annaly Capital Management Inc) | 0.76% | 11.80% |
| Asset1 | TEF (Telefonica SA ADR) | 0.30% | 0.74% |
| Asset1 | PTR (PetroChina Co Ltd ADR) | 0.26% | 1.01% |
| Asset1 | DIS (Walt Disney Company) | 0.52% | 6.24% |
* Day change on 10/19/2022.
Previous
Since 12/29/2006
| Name | YTD* Return |
1Yr AR** |
3Yr AR** |
5Yr AR** |
10Yr AR** |
15Yr AR** |
|---|---|---|---|---|---|---|
| Asset Allocated Stock Selections | -7.6% | -10.5% | 13.3% | 16.6% | 11.3% | 10.3% |
| VFINX (Vanguard (S&P 500) Index) | 7.9% | 27.1% | 8.5% | 13.5% | 12.5% | 14.6% |
| VBINX (Vanguard Balance (60% stocks/40% bonds) | 3.5% | 15.3% | 2.8% | 7.7% | 7.7% | 9.7% |
* YTD: Year to Date
** AR: Annualized Return
| Last 1 Week* | 1 Yr | 3 Yr | 5 Yr | 10 Yr | 15 Yr | Since 12/29/2006 |
2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | 2007 | 2006 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Annualized Return(%) | 0.7 | -10.5 | 13.3 | 16.6 | 11.3 | 10.3 | 11.4 | -7.6 | 13.7 | 34.2 | 41.2 | 8.2 | 3.7 | -2.2 | -12.2 | 16.1 | 26.9 | 3.0 | 18.1 | 28.7 | 27.7 | -25.6 | 30.8 | 0.0 |
| Sharpe Ratio | NA | -0.41 | 0.49 | 0.71 | 0.58 | NA | 0.55 | -0.28 | 0.84 | 1.04 | 3.12 | 0.42 | 0.32 | -0.18 | -0.68 | 1.18 | 2.02 | 0.19 | 1.01 | 1.79 | 1.34 | -0.81 | 1.64 | NA |
| Draw Down(%) | NA | 28.5 | 35.6 | 35.6 | 35.6 | NA | 41.7 | 25.9 | 13.3 | 35.6 | 7.1 | 14.0 | 15.3 | 10.9 | 19.3 | 8.3 | 7.2 | 14.6 | 11.4 | 8.1 | 17.7 | 39.9 | 9.2 | 0.0 |
| Standard Deviation(%) | NA | 27.8 | 26.3 | 22.4 | 18.7 | NA | 19.6 | 30.1 | 16.4 | 32.7 | 12.8 | 16.3 | 9.8 | 13.4 | 18.0 | 13.7 | 13.3 | 15.8 | 18.0 | 16.0 | 20.6 | 32.7 | 17.0 | NA |
| Treynor Ratio | NA | -0.12 | 0.15 | 0.21 | 0.2 | NA | 0.56 | -0.09 | 0.15 | 0.42 | 0.67 | 0.37 | -0.22 | -0.59 | 0.91 | 8.6 | -5.61 | -1.97 | -5.22 | -5.82 | -2.62 | 2.1 | -1.87 | NA |
| Alpha | NA | 0.03 | 0.03 | 0.04 | 0.03 | NA | 0.04 | 0.09 | -0.03 | 0.07 | 0.08 | 0.04 | 0.02 | -0.01 | -0.04 | 0.06 | 0.1 | 0.02 | 0.07 | 0.11 | 0.12 | -0.12 | 0.1 | NA |
| Beta | NA | 0.92 | 0.84 | 0.74 | 0.55 | NA | 0.19 | 0.93 | 0.9 | 0.8 | 0.59 | 0.19 | -0.14 | 0.04 | -0.13 | 0.02 | -0.05 | -0.01 | -0.03 | -0.05 | -0.11 | -0.13 | -0.15 | NA |
| RSquared | NA | 0.55 | 0.62 | 0.5 | 0.26 | NA | 0.04 | 0.56 | 0.51 | 0.72 | 0.33 | 0.04 | 0.01 | 0.0 | 0.01 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.02 | 0.02 | 0.02 | NA |
| Sortino Ratio | NA | -0.61 | 0.71 | 1.03 | 0.85 | NA | 0.79 | -0.42 | 1.26 | 1.47 | 4.81 | 0.62 | 0.42 | -0.25 | -0.94 | 1.83 | 3.42 | 0.23 | 1.44 | 2.76 | 1.97 | -1.11 | 2.41 | NA |
| Yield(%) | N/A | 1.15 | 1.14 | 1.17 | 1.67 | N/A | 2.39 | 0.92 | 1.29 | 1.02 | 1.54 | 1.22 | 0.5 | 3.3 | 2.32 | 2.28 | 2.35 | 2.76 | 3.58 | 3.71 | 4.11 | 2.56 | 2.4 | 0.0 |
| Dividend Growth(%) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
*: NOT annualized;YTD: Year to Date
**Inception: starting from 12/29/2006
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