Another year is almost done. While the year did have some ups and downs, it seems likely I will end up a bit.
This year, as in all years, I made plenty of mistakes. I fell in love too much with commodities and call premiums. That strategy works well when commodities are relatively stable, but can be problematic when prices are dropping. I did start the year being involved in some IPOs, but moved away. I have done some trades over the year that I would classify as speculative/short term - I need to cease and desist.
But I also did some things right. My selections in my MFI select tranches were very good. I would suggest it was my best year. Admittedly, NHTC helped a great deal, but my August and November tranches are flourishing without NHTC. Here is a table showing my MFI Select performance by quarter and by year versus benchmark:
Wow, that is very interesting. So this fourth quarter has been spectacular - up 23%. Of course a big part of that was a rebound from the -14% third quarter. On a differential basis, I am 28 points ahead of the benchmark in 2015. That is virtually identical to 2013. When you look at it like this, it seems I am on the right road.
With the addition of MFI Formula tranches plus my two micro tranches, I have more actual stocks/securities than ever. I have 40 positions. I do wrestle with the question of whether this is too many. While it is certainly true that when you start getting over 20 positions, your results do correlate more and more with the total market; but some of my stocks are pretty small positions. In addition, a few of those securities are bond-like. Here is a table with all my holdings plus relative size:
|Stock||Avg Cost||Current Price||Dividends||Gain per Share||Pct Gain||Pct of Portfolio|
Hard to believe GNW used to be my largest holding. I have certainly had some disasters, between the likes of GNW and GTAT.
One real goal in the next two years is to continue to build out my income stream. I will keep reinvesting dividends in CSQ, AOD, JQC, NTC, SJT, O, OIBAX and REXI. That alone should grow my income by 4 to 5% a year, all else being equal. But I will also try to continue to increase my share counts in these securities on weakness.
I am 56, I think I can have a strong enough stream by age 60. My math is to try at that point to live off income stream, but also be willing to take 2% a year out of my non income stocks. Toss in a couple pension plans, social security and a paid for house (which I might downsize when kids in college) and I should be ok.
Ok, I think that is enough taking inventory. Let me know your favorite gifts (I like my new fitbit)!