How was 2021?

I’m curious how subscribers fared during 2021. Certainly if you’d simply invested in the S&P 500 you’d have done very well. Did you do better by stock-picking? Is there anything you learned that you’d like to share?

I was pacing or slightly outperforming the S&P500 until fall. My growth port has been dragging down my performance and it finally overcame my value and quality ports. Still not a bad year all in all though. Would have easily outperformed sticking to just value.

40%, basically the first 3 Months and then hoddled around 40-55% and finishing with +40%. Tough year to trade, much harder then the SPY or QQQs looked like, very, very thin market (broadness went away in March…)…

Total return of ~55% between US and CAD accounts. Mostly small and microcaps. Agree w/ Andreas, bulk of the return came in Q1, rest of the year was very volatile. Canadian accounts benefitted from recovery in oil prices in H2. Cloud based strategy very volatile, crushed in Q4, regardless of strong fundamentals.

What I found troubling late in the year, several strategies got hit hard by sell-offs, but did not bounce back during the dip buying. Perhaps money moving to indices. If this continues, may have to adjust some strategies.

I usually publish a year end review on Seeking Alpha, here is 2021’s:

I made 73% this year. Also, like in 2017, I made some money in eleven out of the twelve months (July was a killer).

For most of the year I stayed away from stocks in the technology and healthcare sectors and focused on industrials, materials, energy, and financials. (In fact, of all the stocks I bought at some point this year, 8% were tech stocks, 5% were healthcare, 23% were financials, and 38% were industrials, materials, and energy stocks.) The other thing that was different for me this year was that I traded a lot in Canadian F Shares (15%).

I didn’t really change my overall strategy this year very much. I traded a lot, practically every day; I focused on microcaps (54%) and small caps (40%), but started avoiding horribly illiquid stocks, and bought a few midcaps and large caps too (7%); I kept the number of stocks I held at any one time between 25 and 45; I stuck to two highly correlated strategies rather than exploring a whole bunch of uncorrelated ones; I used margin, but only about 10%; I didn’t keep much money in cash. I pretty much stuck to Peter Lynch’s dictum of investing/trading in boring companies.

I was up 31% for the year. In March I was up over 100% and sadly gave a lot back, as I failed to move up my stops aggressively enough when part of my portfolio went parabolic in February.

My main 20 stock port returned 62%. Mostly microcaps with no Financials Another 10 stock port that I use on a small retirement account got 54%, but like most microcaps it really plateaued around June. I’ve now expanded that one to 20 stocks to smooth out some stomach churning volatility. I’ve used the Dataminer and API tools to reconfigure my ranking systems in 2022. Now leaning more towards sentiment factors than previously, and underweighting value even more than it already was … so now with that in implemented, no doubt that traditional value now goes back into favor in 2022 :slight_smile:

I keep waiting for these systems to get arbitraged away, but now I wonder if crypto isn’t a such a diversionary magnet for speculation and mania that who wants to waste their time buy boring old industrial microcap companies that nobody has heard of or talks about on social media. The returns can off the charts by traditional standards, but they don’t go up 300% in a day because Elon Musk tweets a funny meme about them.

That’s fantastic guys, I have a lot to learn from you all. My Portfolio did 42% last year. I am more of a buy and trade seldom investor, with a heavy discretionary component to my analysis. Turnover was < 30% and maket cap ranged from Mega (i hold apple) to Micro

I ended up with 70% return for my American small caps portfolio and 30% for my Canadian portfolio. I’m very happy about the results, of course, though I feel I’ve been exceptionally lucky. The American portfolio outperformed in Q1, Q2 and Q4, while Q3 was pretty flat. The Canadian portfolio had a great first half of the year and poor last half. Six months of underperformance in Canada was a bit difficult emotionally, I ended up tweaking the portfolio and the ranking system way too much, I should have been more patient.

As for learning, I’ve been finding small improvements all through 2021, both in the ranking and the optimization routine. The API has been extremely useful. For 2022 I’m really looking forward to getting access to European data.

Congrats to all of you. I am a newbie and your numbers are incredibly motivating. Curious to know if you are getting these returns on $100k-500k accounts, or larger? Seems like there is a correlation with size and return, but maybe not as much on this size of account.

It’s true, and you did this also for the P123 accounts! Too bad I had the big one and you had the smaller ones :frowning:

Can you manage the rest of the P123 money ??

Really impressive some of the results posted - especially considering the size of money some are putting to work in the micro and small cap space. Congrats to those who did well. Seriously - I’m impressed. :wink:

For me, it’s much larger: I started the year with $2.5 million. But I got better returns on smaller accounts that I managed. Size does hurt: market impact costs really do add up. I see them every day.

What kind of turnover did you experience with your strategy, Yuval? And IIRC 25-45 positions right? Regards,

Ryan - thanks for this post. I did not realize you posted on seeking alpha. In your Ken Fisher article, you show a slide of market share. How does one calculate that in P123? Any guidance will be appreciated.

I’m not sure of my turnover. The average number of days I held a closed position was 55 and the average number of days held of my current open positions is 81.

And yes, 25 to 45 positions.

If you don’t mind, PM me on Seeking Alpha so we don’t hijack this thread :slight_smile:

Every year there is this kind of calendar year assessment but I don’t see any value. Hoping someone can sort this out for me.

If we look at actual data, like the designer models, we don’t see any kind of out performance. There are stories here and there, like Yuval this year, of one off successes, but even in his specific case, the transparent designer models tell a different story – one of random ex post relative performance since inception. At best, the data shows one model that meaningfully outperforms but it not accessible (max of 2 subscribers).

How do these kind of discussions help? It’s an annual post and I just don’t see the value - aside from entertainment. Do I have this wrong?

There are several designer models that did well. The Seven Sisters did 80%, Keating’s 20 did 70% and Yuval’s Crazy did 55%.

The value here is in a) proving that using Portfolio123 can help people beat the market. Many of our subscribers have done so. And b) people sharing how they were successful or unsuccessful with other users, who can then learn from them.

There is no outperformance of the designer models because people aren’t actually using or maintaining them. They posted them a long time ago, let them run, have not revised or worked on them, have not corrected for overfitting, and so on. You should look only at designer models that are actually being used and being kept current. For example, I revise my small cap and microcap designer models every few years because it’s important for me and for my subscribers that they remain current. The other models I created are just sitting there unused. If I remove them I’ll be accused of survivorship bias. You can’t win. The designer models prove nothing. The losing ones are inactive and the winning ones are overwhelmed by the inactive ones. It’s as if you judged hedge fund performance not only by the hedge funds that are out there but also pretended all the ones that aren’t out there any more still are, and are still losing money.

My success is not “one off.” I’ve beat the market every year but one, with a total CAGR of 49% over the last six years.

I hope this helps answer your question. Ryan can perhaps answer it even better as he wrote a long article for Seeking Alpha about his performance this year.