TTI is back after a 1 month hiatus.
I’ve been ticking off life goals… in an earlier post, (It’s somewhere around here. Lazy to go dig through and link it to this.) a reader commented that I should visit Mont Saint Michel in France over the famed Meteora in Greece… and since he’s actually visited both and stayed in France for some time, I’d defer to his expert opinion.
So I did.
And this is really as close as one gets to being Jon Snow.
I mean… This is Harrenhal in GOT:
And this is real-life Casterly Rock:
And of course, we have Winterfell:
And Dragonstone, which in real life, looks a lot more underwhelming than the CGI-ed version in GOT:
And…. there’s Mont-Saint-Michel in all its glory, without any CGI:
Doesn’t look out of place right?! We just need to CGI in a dragon perched on top of the tower.
OK, with TTI’s excellent CGI skills, there. A scene straight out of GOT (with some imagination pls):
When the tide comes in, it’s even more beautiful as the vast array of beach u see there gets completely submerged.
The feeling inside is well… wow. I can’t describe it. It’s kinda like getting teleported to ancient medieval times. (OK, the hordes of tourists spoilt the mood somewhat tbh. It’s neck to neck crowded.)
I’m really glad I took the suggestion though, cos this is not a place for old folks. It’s now or never.
They tried to keep the original structures intact as much as possible, so there are no elevators or escalators, and the stone paths are really stone paths, and the stairs are uneven in height and hard to climb . Not something for the immobile. The young kiddos managed without too much difficulty though, despite it being really super duper crowded.
Close up, it looks as stunning as it really is:
We climbed all the way to the peak and had a sandwich picnic at the top, overlooking the entire moat. Absolutely stunning.
What’s even more memorable is the night before.
We wanted to get night pics of the place, and there’s a long tiny road with a fast flowing stream just beside it, and it was freezing cold but we walked something like 5km just to get nearer to it for better pics. (But to no avail. I’m not camera enthusiast so the iPhone pic didn’t turn out well)
The walk though, is strangely…… very fun. In the dark of the night, with the wind howling, freezing cold, and since there’s nothing else to do besides walking, we ended up talking a lot.
It’s just a different experience.
Anyway, so what’s “Treh-Bu-Quah”?
We went to a place that actually demonstrates the medieval way of living. It’s really as realistic as it gets. You get to even learn sword fighting (with real blunted swords and shields), try out real archery (they call it something else but I can’t rem the term now), do masonry, craft pottery, leather weaving and THIS is probably the highlight for me:
These guys show how a real operational trebuchet works.
WordPress very irritatingly, doesn’t allow me to put videos here, so I’ve to create an account in a video sharing site for this:
“TRE-BU-QUAH!!!” (LOL I guess that means Trebuchet?)
Very cool right?
The next guy though, kinda got his physics wrong, and ended up launching it way over the wall!
“Oh my gosh!” LOLOLOL!
You can literally hear the “OOOOOOHHHHHHH!!” cos it’s not really just a wall, but some sort of a tower where visitors can enter.
So the projectile could’ve landed and really injured somebody inside…
But of course, they didn’t really use a real projectile/missile. It was some soft rubbery ball filled with some powder inside, that exploded on impact.
Still, you can literally sense his embarrassment at missing. He quickly walked away.
Everybody was chuckling and it was a bit funny tbh. After that, when everybody left, I saw him vigorously discussing what went wrong with another colleague (or maybe his boss)
Anyway, I’m back to reality and back to work, so no more tre-bu-quah-ing for me for a while.
I kinda missed working after a while tbh. When the holiday’s too lengthy… it gets a bit boring. That’s my hypothesis anyway.
The best parts of a holiday are at the start of it. So I try to keep it relatively short.
A couple of months ago, a friend and investor suggested to me over dinner that I should keep track of my returns on a daily basis. I’ve been only tabulating returns every quarter, so as to avoid “short termism” in my thinking, but what my friend suggested made a lot of sense.
His rationale of tracking daily returns is not to try to find short term ideas, but simply so that one can track back and see where are the times when there’s a major drop in your portfolio. You can then go back and see what are the events that caused that major drop, and dissect your actions or thoughts in relation to that major change (ok not necessarily drop. It works for a big rise too)
So in short, daily data would have the sensitivity to allow us to make such retrospective assessment.
Well, I respect the track record of said investor, but tracking every day is a bit of a chore for me. Fortunately though, Interactive Brokers does it automatically for me so for now, I’d use only my global equities and options portfolio (excluding SG).
All right, so this is how TTI’s y-o-y, time weighted returns look like. I’d attempt to glean some insights from it:
Note that these are all time weighted and irrespective of capital injections or withdrawals.
These are my thoughts:
At 1st glance, I should be pretty happy with 15.24%. I mean, as I’ve worked out previously, if I could compound 15.24% annually y-o-y, year in year out for the next 35 years or so….
Now, I really like the table comparison in the post, but wordpress makes it difficult to cut and paste here (I can’t actually). I’d have migrated to a different host but anyway, I predict that I’d have to defunct this blog a year from now, so lazy to do so.
A 20% ROI compounded will bring me up to several hundred millions, so compounding is really the 8th wonder of the world. My capital is somewhere just below the 3rd year mark… so I’m actually 1 year ahead of schedule. It shouldn’t be too difficult to cross the 3rd year mark by the end of 2019. In fact, I’m hoping to bust the 5th year target of $2,488,320 by then.
So 15.24% did put a smile on my face (FY18Q2 -“Fun Isn’t Something One Considers When Balancing TTI’s Portfolio. But This…(heh heh heh heh) Does Put A Smile On My Face.”)…. until I saw this:
Oh COME ON!
Give me a break!
A freaking passive S&P index ETF would’ve generated a ROI of 17.98% y-o-y!
And that’s excluding the 1.7% worth of dividends that one would’ve received.
It’s truly been rather difficult to beat a passive instrument like SPY these couple of years. (Forget about the chronically ill STI ETF).
I suspect most money managers would not have beaten SPY. Much of this 17.98% is driven by powerhouses like Apple, Netflix and Amazon… so to beat this, one would’ve to have similar constituents to the S&P index, and yet, have a larger weightage of holdings in the few powerhouses while avoiding or reducing the poorer performing constituents.
Back to the chart:
The other thing that struck me is the immense volatility.
At it’s highest, my TWR was a massive 27.14%, while at the lowest, it was a scary -9.35%.
If I did not have this chart, and I was asked arbitrarily to guesstimate how I’ve done thus far comparing to the same point in time 1 year ago, the chart that I’d guesstimately draw would be completely different from this.
For starters, it’d probably be much more gradual aka with less volatility.
Lastly, with the data, I’ve gone back to see what are the conditions/holdings that caused the big drops in early Feb and end June.
Early Feb is easy. That’s the 1 week of mayhem where the huge record jump in volatility bankrupted many poor folks around the world (1 of whom I communicated with on SeekingAlpha and sadly, I don’t think he’s ever coming back from that again. It’s a total wipeout)
End June is all thanks to Diebold, for which I took a big hit. The lesson learnt there is to learn the lessons that I preach myself. It was a small position that got bigger over time with the put options that I wrote. Yet, I continued paying as much attention to it as though it was insignificant.
The past 2-3 weeks has been really kind to my portfolio though, as the TWR has more than doubled since the low of +7.16% on the 16th Aug 2018, to the current +15.24%.
That’s thanks to a bold position in GDS Holdings (11% Returns In A Single Day. Thank You Blue Orca Capital!), as well as some equity and option positions in Broadcom, Bausch, Visa and in Disney.
So all in, I’ve found the suggestion by my friend to be extremely useful. There are other thoughts that I wouldn’t include here, but I’d urge other fellow investors to consider implementing such a system. Frequent trackbacks and analysis of one’s actions is really rather useful to review your previous thoughts and the outcome of your actions.
I’d end off this post with a real life account of a reader, who has rather impressed me.
I’ve obtained permission to publish these communications, but without identifying him though, so let’s just call him “FF”.
Font for the emails is small, but do read cos they tell a story…
FF first wrote to me over a year ago, in June 2017:
FF is an accountant by training, but as he self admitted then, “my skills in equity is not up to mark. I am still learning to improve my returns.”
It’s a funny thing, but many accountants that I know personally, are actually really terrible investors. I’d have thought that they have a huge headstart, cos you don’t have to learn the language of business, yet many actually… don’t know a lot. Anyway, that’s just anecdotal and my personal experience.
After some back and forth questions and discussions, which probably made him more confused, FF ended by saying his resolution for the year (remember it’s 2017) is to learn certain concepts, and he wanted to understand options as well:
I didn’t hear from FF again for the next 6 months.
FF emailed me again early this year, and this time, he’s obviously upgraded himself a fair bit!
FF made a mistake (in his own words), having sold a naked call that he was subsequently forced to cover. That impacted on his returns.
Still, as FF assessed himself. “the results show encouraging (sic) should the mistake not be made”
By now, we’re going into March 2018, and FF has obviously been doing a lot of work on this front. Having started by questioning, trying to understand and debating some of my positions, like VRX and CTL, he’s now progressed to his own ideas.
I’ve no positions and never have, neither have I ever done any DD on micron tech. It’s all his.
Accordingly, of course I didn’t have much useful insight to add.
FF did very well though in his positions in micron tech, booking a profit of 66% then.
Finally, FF sent me the records of what he’s done to take a look. It’s really in it’s infancy then, so it wasn’t hard to understand, but I was pretty impressed when I saw it, cos… well, less than 1 year ago, this is the same guy who has no idea what I’m talking about!
well, 2 months later, in May 2018, FF emailed me again:
This time, FF included some hard figures for me to consider. Nothing too comprehensive.
The tables are turned this time though, cos I had no idea what he meant by the “DC” column, and FF had to explain to me that DC = Diagonal Calls, and how they work.
As of July 2018, FF did really well with an over 20% annualized return:
August 2018 though, hasn’t been too kind to FF as his Option positions in JD turned sour. Still, I’d say a 14% annualized ROI is really not too shabby. (OK, we all fail to beat SPY this year YTD, but if we compare to STI ETF, it’s a sound trashing!)
Alright, and I’d stop the correspondence pasting here.
Looking at what he wrote and the attached table though, I feel really delighted for “FF”.
Particularly so with what he did on SEDG. Again, it’s all his idea, but I think what he did there captures the essence.
Let’s consider that about a year ago, this guy has absolutely no inkling what’s going on.
FF decided he wanted to learn something, and despite crediting me, I’d be honest and say that he did everything himself.
This guy just kept disappearing for a few months at a stretch, and each time when he comes back, he’s upgraded and improved! LOL! Like Iron man! From the chunky makeshift armor made in the desert, to the Mark II version, to now, the nanobots version!
And looking at his table, that sort of monthly cashflows considering the small capital he’s committed, is actually very very good. (TBH, I don’t share his enthusiasm for JD.com though, but I have no insight to add to the DD he’s already done himself)
FF has an account in InvestingNote, but he makes zero comments, has zero posts, and only followed 1 person: TTI.
He’s like a submarine, disappearing in the depths to go do his thing stealthily and covertly……. and surfacing once and then to probe around.
I’m genuinely impressed cos I think there’s a lesson here. Much like what I’ve learnt from my friend’s suggestion of daily tracking above, FF has continually done self assessment, asked probing questions, modified, implemented, and back to assessment again.
Now, isn’t that how learning should be like?