(Podcast) What’s the Right Way to Measure Your Portfolio’s Progress?
Can you believe it? The year 2015 is already half over. As second quarter investment account statements arrive, now is the time to un-distract yourself and focus on what’s impacting the performance of your money.
Why do so many people ignore their investment portfolio? Is it because they’re afraid to look inside? Often, it’s because people don’t understand what they own and they’re unsure of how to properly judge their portfolio’s performance.
In my latest Index Investing Show podcast, I explain the easy and right way to see if your portfolio is progressing or digressing. Remember: Performance will either validate or invalidate your portfolio’s overall design.
It’s been 1,368 days since the U.S. stock market’s (NYSEARCA:SCHB) last 10% correction. How does the current winning streak compare versus history? In my same podcast episode, I give listeners historical perspective on the S&P 500’s (NYSEARCA:SPY) current winning streak. Yes it’s amazing, but it still doesn’t break all-time records.
Which major asset classes have suffered the most disappointing year-to-date returns in 2015? Clearly, gold (NYSEARCA:IAU), with a -1.6% loss, sits atop the list of this year’s biggest strikeouts. (See chart below.)
Although mainland Chinese stocks have crashed (NYSEARCA:ASHR) over 20% from their peak and Greece’s situation (NYSEARCA:FXE) has significantly deteriorated, gold has been unable to shine during these crisis moments. And the fact that gold isn’t outperforming at moments like now – when it should be – once again proves the multi-year deflationary forces in gold prices that began in 2011 aren’t done. (Our latest ETF Technical Forecast gives readers our latest gold analysis with trade setups.)
What does this mean for precious metals (NYSEARCA:GLTR) bulls?
Ignore the gold conspiracy theories, they don’t make anybody money but the hucksters who peddle them. And the laughable predictions of gold at $5,000 per ounce given by conflict-of-interest riddled permabulls who make regular cable network appearances are consistently and badly wrong.
If you’re looking for a fun summer read, check out my 4-star reader rated book “Gents with No Cents: A Closer Look at Wall Street.” I’ve always said that 99% of all statistics only explain 49% of the story. And “Gents with No Cents” is my attempt to cover the 51% of the story that the stats can’t explain. At the very least, it will help you to understand why people like to buy high and sell low.
Follow us on Twitter @ ETFguide