Tag DIY investor

Beat the Market in 2023

Paul - The Wry Eye Guy Leave a comment
Beating which Market!?!

Happy New Year to all & here’s to our collective success in beating the market this year. Of course, we can’t all beat the market, we need some losers to lose money so we can be winners. But in the best tradition of reading great free advice on the internet, let me tell you that while beating the market is a big deal, it’s not that hard to do.
(Make sure you don’t stop at the first chart, there is a twist to this tale! 😜)

If you’d stuck a thousand bucks into these three ETFs back at the end of 2013, & reinvested the dividends along the way, you’d have beaten “the market” with any of them. Check out the chart below, the two BMO ETFs & the Vanguard Canada ETF all beat the American index tracker. Seems like a no-brainer, eh?

Of course, making a decision from this one chart would not be wise. And you’re seeing it on the internet, for cryin’ out loud! Instead, we’d have to do our due diligence, eh? Maybe read the marketing blurb on the fund’s website. Find a few online buddies that have invested in it & that want you to invest in it too. Ignorance, like misery, loves company. That is not doing due diligence!
Now look at that same chart but, this time, with Vanguard’s VFV replacing SPY & you get this …

What’s going on here? Both SPY & VFV track the same index. Yet VFV is doing way better. It’s because we were comparing red apples to green apples in the first chart. SPY is in US dollars. Back at the start of this comparison, the Canadian dollar was strong for the first couple of years. The original investment in SPY was in US$, while the original investment in VFV was in Can$. As the Canadian dollar weakened over the years, VFV benefitted from holding US stocks, priced in US dollars. VFV is getting a numeric advantage because one US dollar is buying more loonies today. That makes VFV’s numbers bigger. But the benefit is only in the numbers, not in the value when compared to the current exchange rate. In fact, SPY would do a little better because of its lower fee structure. However, for a Canadian investor to buy SPY, there would be a currency exchange cost to consider too.

Only ZLU beat the index in both cases, so just buy that one, right? No, it’s not that simple. While all these ETFs are good, they only work as part of an overall investing strategy. They each hold differing numbers of stocks, with different sector exposures. They have different yields & costs. They are all focused on US stocks. Are they cheap or expensive relative to history & expectations? Besides, who knows what happens going forward. And 9 years is not a long time in investing cycles.
Which of these you choose for part of your portfolio depends on your investing philosophy. If you don’t have a personal investing philosophy, it’ll be tougher to build an investing strategy that will work with your fears & needs. This will be different for everyone. But once you know who you are as an investor, & what you are trying to achieve, you will find it easier to invest in things that might have a better chance of delivering for you. And, sometimes, that might mean we don’t need everything we hold to beat the market all the time.

This year, as with all prior years for a long time now, my new year’s resolutions include losing weight, exercising, & saving more.
Along with developing an investing philosophy that I’m comfortable with! 😜

Best of luck for 2023. I hope it’s a good one for all of us.

10 Ways to be an Expert Investor on Social Media!

Paul - The Wry Eye Guy Leave a comment
Pennies & Nonsense!

#10 … Post links to recently announced company results. If you can get off the mark early here, this makes you look smarter than the rest of the pack.

#9 … Quote well-known, high-visibility investing superstars. Often! And you can’t go wrong citing investing legends like Warren Buffett & Jack Bogle.

#8 … Criticise those well-known investing superstars who have hit a slump. They fell into a hole that you didn’t. You’ll look way smarter for having avoided the dumb mistake that the superstar didn’t.

#7 … Cite highbrow investing papers that say most experts cannot match market performance, most of the time. The softly veiled implication being that maybe you can!

#6 … Sound really confident about your recent investment. Justify it with musings on the balance sheet, book value & cashflow. But make sure it doesn’t look like you’re pumping the stock. Classic desperate expert mistake.

#5 … Pump crypto! Nobody has a clue what’s going on with this crap. And you can’t really be criticised for holding a belief in crypto as the new gold. That’s kinda like saying you can’t be feeling what you’re feeling. That’s a big no-no with investing snowflakes these days!

#4 … Talk about having a well-diversified portfolio. Maybe even recommend an ETF or two. Especially one that dilutes your home country bias. Unless, of course, you are really kicking the market’s ass with a focused strategy.

#3 … And if you do have that winning strategy to brag about, go ahead … brag. If you dare! But be ready to run for cover when your red hot portfolio cools. The pack will smell any lack of expertise & will socially annihilate those who screw up.

#2 … Be obscure. Use a whole bunch of big, financey, investy-sounding words. But combine them in phrases that are totally circular, meaningless, & nonsense. Like one of those touchy feely new-age books. Nobody will have a clue what you’re on about. And that makes you sound really clever. You might even be a new-age financial guru!

#1 … One of the best ways to be an expert is to circle jerk with other experts. Get some buddies who are all pumping the same philosophy & stocks that you are. When you & your buddies are all sharing the same stuff, the increase in noise makes it all seem so real. Who knows, you might even move the needle on that penny stock that you want to break even on!

Okay, I’m just having a little fun here. There are some really great investors online. Many of them sharing really good information. My problem is that I can’t figure out how to sort the good ones from the bad. And is it true that I won’t know who the real winning stock pickers are ’til years later??? When it’s all too bloody late! 😜

Who are your go-to financial gurus on social media? I’ve been unfollowing a bunch recently & I need to add some new ones. Send me your winningest gurus. And maybe a few funny ones too! 😉😁

Dishwasher Art

Paul - The Wry Eye Guy Leave a comment
Thermaquaformed Cellar of Salt!

Many of us are getting better at the whole work-from-home thing these days. Some of us are picking up new hobbies along the way too. I’m struggling along trying to add a few words of French to my very limited vocabulaire, for example. I’ve also become a part-time DIY investor. There seems to be some sort of correlation between my portfolio & when the market is going up. I might be on to something here (😜)!!! And while my diligence with my writing is nothing short of horrendous, I have had an occasional artistic success.

In case you’re in search of a new hobby, I’d like to share one of those successes with you …

Dishwasher Art!

I know, I know, it sounds a bit silly, doesn’t it? But have you seen the money some of our art galleries have paid for a few big stripes of leftover paint on a sheet of drywall? What about your man that used to dance all over the canvas on the floor like a mad thing, while splashing paint all over the place. What was his name again? It escapes me for the moment, but if I ever get to have a pint with the guy in the hereafter, I know I’ll be ROTFLing with him. He’s probably got abs from laughing so hard at the money people were willing to pay him for using up the dregs in the leftover paint cans in the basement.

Well … Dishwasher Art is even better than this. You don’t need an art studio. There is no mess & no cleanup. In fact, you can do it while the dishwasher does the dishes. Anyone can take on this new artform, but only a few will rise to the top of what might become a new art niche. If it works out for you, remember who told you about it first!

A little while back, I bought this big tub of pink Himalayan salt. I got it because I thought the pink salt looked kinda cool. It was all odd-sized granules, more natural & elemental, very artisanal in fact. But some of the grains were too big & they blocked the holes in every salt cellar I owned. My salt cellars were all made of glass, or ceramic, or of some bloody material that I couldn’t easily run a drill bit through. To enlarge the holes, you see. I thought of going into the forest to hew down an oaken limb, so that I might sculpt an artistic salt cellar, for my artisanal salt. No, I shaggin’ didn’t, are you out of your mind? That’s way too much work! LOL

I went hunting in the press (cupboard!) for a nearly-empty bottle & I found one with a few whole peppercorns, balling about the bottom of it. Dumped those into the pepper mill & then, I had me a salt shaker in the making! Whacked a hole through the center of the plastic screw-on cap & tossed the nearly-finished ensemble into the dishwasher to excoriate the piquancy of the perrercorns’ piperine. I like pepper but I didn’t want the peppers’ pungency contaminating the olfactorius magnificence of the Himalayas on me. 🤪

While lesser mortals were decrying my daring, insisting that my simple cellar should not see the light of day in the company of visitors, I forged ahead regardless. Creating the masterpiece in the pic above.

Dishwasher Art! 😜😁

PS … There’s no truth to the rumour that pink Himalayan salt is a miracle weight-loss cure! 🤪