The Basic Portfolio strategy is tracked as a hypothetical portfolio on Scott's Investments with a $10,000 starting balance. The portfolio finished down over 5% for 2011, including dividends. The strategy for the portfolio is simple: purchase the top 3 ETFs with the highest average 3, 6, and 12 month returns ("3-6-12"). Only purchase the top 3 ETFs if they are also above their 200 day simple moving average at month end. Investors could also ignore the moving average indicator and purchase the top 3 ETFs strictly based on historical returns ("3-6-12") or could use a combination of different approaches or trading strategies.
Listed below are the month end results for December of the 5 ETFs listed above. This month the holdings are BND and the new additions are VTI and VNQ because they both finished the month above their 200 day moving average.
Many of the strategies listed here were inspired in part by Mebane Faber, author of The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets
. For an even better explanation of some of the strategies, I recommend the book. The data source for the information below is Finviz, and Google Finance. No positions
I will be changing the way the portfolio is displayed on Google Docs - the current positions will still be displayed but performance data and historical transactions will soon be dropped from the document. The primary reason is that the data tracking for multiple portfolios has become too time-intensive so I will be using a third party platform to track investment performance. Also, spreadsheets tend to become "noisy" with too much information, so I will scale down the information on the spreadsheets with more focus on tracking performance over time.
All of my hypothetical portfolio analytic's will be improved so that an equity curve and other statistics will be displayed when I write updates on the portfolio, a significant upgrade over the current system. For a preview of some of the data I will be providing on portfolios, please see the bottom of this post.
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| Symbol | Name | Quarterly | Half Year | Year | Average | 200 Day SMA |
| BND | Vanguard Total Bond Market ETF | 0.52% | 4.49% | 7.16% | 4.06% | 2.52% |
| DBC | PowerShares DB Commodity Index Tracking | 4.23% | -7.45% | -2.58% | -1.93% | -7.22% |
| VEU | Vanguard FTSE All-World ex-US ETF | 5.99% | -18.47% | -14.03% | -8.84% | -9.39% |
| VNQ | Vanguard REIT Index ETF | 15.29% | -3.14% | 8.63% | 6.93% | 3.16% |
| VTI | Vanguard Total Stock Market ETF | 12.04% | -6.30% | 0.97% | 2.24% | 0.09% |
Below are some performance data screenshots of the portfolio for 2011:
Disclaimer: No current positions in stocks mentioned. Please note that Scott's Investments and its author is not a financial adviser. Please consult your own investment adviser and do your own due diligence before making any investment decisions. Please read the full disclaimer at the bottom of Scott's Investments.
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