Although the stocks were picked with a 10-year hold in mind, I don’t see why we couldn’t make adjustments to the portfolio periodically.
Because it sabotages the original idea of picking stocks with a longterm horizon in mind.
(As that was the original background I see “periodic adjustments” no matter whether done in Form of monthly polls or in any other way not as “optimize the portfolio” but as messing that up and diluting it.
And the currently last contribution “sell the worst performer since inception, and add to the top three performers since inception” I actually see as perfect confirmation of that.)
*Although the stocks were picked with a 10-year hold in mind, I don’t see why we couldn’t make adjustments to the portfolio periodically.
Because it sabotages the original idea of picking stocks with a longterm horizon in mind.*
Yes, you are right, and I didn’t express myself very well. Of course, the idea is to buy things you wouldn’t mind holding for 10 years, just like Buffett suggests buying stocks as though you had 20 punches on your card and that’s it. That doesn’t mean you actually have to hold them for 10 years. All the more reason to compare 2 approaches: one where you keep all the stocks (unless they split, or go out of business, I suppose.) In the other approach, you pick a new one every month, and jettison one that no longer seems like a good 10y hold, for instance because the price has gone up so much that it no longer has a good 10-x year perspective. Which approach would work better? I don’t know. I am more inclined to the second, but the first should be kept as is as an illustration of the alternative, hands off approach.
OK. Let’s stick with the original portfolio and not make any adjustments. I’ll also take VOO out of the portfolio. I would like to hear members’ thoughts on the portfolio as we go along, though. Best of luck to us.
I think if we want to share new ideas on individual stocks, or if we want to see how good we as a group are at picking stocks, then we should start additional portfolios each Dec 31st. We get the most interest when we’re picking the stocks. I’ll let someone else do it, though. I don’t see a great deal of interest at the moment.
Is there any more that we can learn from the results so far? I realize that we don’t have a lot of data yet, just have 25 stocks for four months, but underperforming the S%P by 8 percentage points during a period when the S&P is down 4% is quite a lot. Value portfolios generally outperform the S&P when the return of the S&P is low. Any insights?
rram, could you please help me check the status of the BAM holding that you recommended? Morningstar is not handling the dividends or the split correctly. My records show that we purchased 79.3179 shares of the old BAM at the market close on 8/8/22 of $50.43, for a total investment of $4,000.00. On 8/30/22 and on 11/29/22 the old BAM, now BN, issued dividends of $0.14/share, which were reinvested at $39.590 and $36.633 respectively, bringing the share count to 79.9026 (Morningstar got 79.974. Did I make an arithmetic error?). On 12/12/22 BAM changed its ticker to BN and also issued 0.25 shares of the new BAM per share of BN. If my arithmetic is correct, the group portfolio now owns 79.9026 shares of BN and 19.9757 shares of the new BAM. Is this correct? Thank you.
Would you please check my arithmetic on BAM/BN? Thank you.
Where did you get the price you used to calculate the dividend reinvestments? Was it the open, close, average price on payable date?
Morningstar may have used a different price than you.
Brokerage combine all their clients’ DRIP requests and place market order on payable date. So the actual reinvestment price may differ across brokerages.
I used the prices that Morningstar used. You’re probably right, though. The difference is the price at which the dividend is reinvested. I guess I should use Morningstar’s number of 79.974 shares prior to the split. Then I’ll buy 0.25*79.974 = 19.9935 shares of the new BAM. Thanks for your help.