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The Johnny Doe IBKR portfolio

Everybody does.

If you want income maybe just holding SPY and selling low-risk further OTM weekly or monthly covered calls could get you about 1% return (including SPY dividend) per month on capital. Buying back right away when assigned.

I would split 80/20 SPY/QQQ applying same strategy for a bit of more growth/income.

Agreed that this is not 100% passive.
What you suggest makes sense but requires to follow the market actively, which I no longer want to do. So I leave that to the pros: as you see I hold a few funds that play with options. This way I make less money but I am healthier.
 
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Yes I suck at beating the SPY, which btw is not what I want to do.
What is it you try to do then, if I may ask?

I feel your allocation would benefit from your own fixed-income purchases and no concentration in small-caps (small-caps are known to underperform).

There is also a very high amount of fixed-income ETFs that have a +1% expense ratio which is really eating into your ROI over a longer time period.

My quick evaluation of almost every instrument:

DBMF -> This product is:

- Heavy on cash (collecting interest).
- Heavy on T-Bills
- Long on Euro and WTI futures

Short:

- Gold
- MSCI Emerging Markets
- US Bonds Dec23 expiration (betting on dovish remarks from JPOW).

GOF:

- Heavy expense ratio -> 2.88%! annually for 8% YTD returns
- Extremely poor returns

I would advise against buying fixed-income funds. It is always better to just buy fixed-income products yourself (you can do bond subscriptions yourself on IBKR).

GWX:

- Small caps have always been poor performers. 80% of gains are created by 20% of companies approx.


HIGH:

- Another fixed-income ETF


INDA:

- Interesting although why would you opt for a fund if you can just buy the index yourself?

JPIE:

- Yet another fixed-income ETF

MCHI:

- 1% returns in 10 years, yikes.

MMM:

- Do not know your thesis behind 3M

RIVN:

- Company with no profits valued at 18B, would only buy with strong industry or insider knowledge.

RYLD:

- Covered calls on small-cap stocks? Why? The bulk are profits are captured by a small set of superstar-companies. Read: Exponential: How Accelerating Technology Is Leaving Us Behind and What to Do About It: Amazon.co.uk: Azhar, Azeem: 9781847942906: Books

SDIV:

- Interesting product at a decent price (expense ratio)

SPHY:

- Fixed-income ETF again

SPY:

- Always good if not the best, even for the coming century.

SPYI:

- Another fixed-income ETF

SVOL:

- Interesting hedge or directional play

VT:

- Just buy whatever is in here yourself

VZ:

- A telecom company dominating the US market trading at 7.71 P/E and with a fat div-yield. Nice!

I leave that to the pros
Just buy some bonds from countries you think will outperform, buy their indices and / or some some ETFs, and if you like them buy some dividend aristocrat ETFs. Don't concentrate in small-caps.

Especially in the current interest rate environment bonds seem to be a no-brainer if you want steady income. You can buy US and EU bonds on IBKR and collect a good coupon with your only worry being the Western World collapsing.

And if you are into BRICS, try to see if you can find USD-denominated BRICS-bonds (or in their own currency if you think the USD is on it's path down but that is up to you).

For pure dividends there are good options like:

- Altria keeps giving
- Enegas is lovely (Spanish gas-company with fat dividends).
- Oil refiners in the US used to be my main rec. (like MPC) but they ran up so-hard they are hard to recommend with full conviction.
- PepsiCo is priced very attractive currently
- Newell Holdings is well priced right now imo.
- IBM pays 4% dividend while being a respectable tech-stock.
 
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What is it you try to do then, if I may ask?
Income (plus some extra pickings)
There is also a very high amount of fixed-income ETFs that have a +1% expense ratio which is really eating into your ROI over a longer time period.
I think they are worth it
My quick evaluation of almost every instrument:

DBMF -> This product is:

- Heavy on cash (collecting interest).
- Heavy on T-Bills
- Long on Euro and WTI futures

Short:

- Gold
- MSCI Emerging Markets
- US Bonds Dec23 expiration (betting on dovish remarks from JPOW).
The strategy is dynamic, correlation is low and dividends are high (8+%)
GOF:

- Heavy expense ratio -> 2.88%! annually for 8% YTD returns
- Extremely poor returns
16% dividends
I would advise against buying fixed-income funds. It is always better to just buy fixed-income products yourself (you can do bond subscriptions yourself on IBKR).
I already hold bonds elsewhere
GWX:

- Small caps have always been poor performers. 80% of gains are created by 20% of companies approx.
“Always” doesn’t mean “forever will”
HIGH:

- Another fixed-income ETF
9+% dividends
INDA:

- Interesting although why would you opt for a fund if you can just buy the index yourself?
Do you mean the futures or the single components (131)?
JPIE:

- Yet another fixed-income ETF
5.7%
MCHI:

- 1% returns in 10 years, yikes.
I bought it in 2022
MMM:

- Do not know your thesis behind 3M
5.8% dividends
RIVN:

- Company with no profits valued at 18B, would only buy with strong industry or insider knowledge.
Bought at 16.17 based on value considerations.
RYLD:

- Covered calls on small-cap stocks? Why? The bulk are profits are captured by a small set of superstar-companies. Read: Exponential: How Accelerating Technology Is Leaving Us Behind and What to Do About It: Amazon.co.uk: Azhar, Azeem: 9781847942906: Books
To balance the other funds trading options
SDIV:

- Interesting product at a decent price (expense ratio)
11.7% dividends
SPHY:

- Fixed-income ETF again
8% dividends
SPY:

- Always good if not the best, even for the coming century.
Bought it in this context just to balance SPYI
SPYI:

- Another fixed-income ETF
12.2% dividends
SVOL:

- Interesting hedge or directional play
Non correlated, 16.3% dividends
VT:

- Just buy whatever is in here yourself
4,594 holdings?
VZ:

- A telecom company dominating the US market trading at 7.71 P/E and with a fat div-yield. Nice!
6.9% dividends
Especially in the current interest rate environment bonds seem to be a no-brainer if you want steady income. You can buy US and EU bonds on IBKR and collect a good coupon with your only worry being the Western World collapsing.

And if you are into BRICS, try to see if you can find USD-denominated BRICS-bonds (or in their own currency if you think the USD is on it's path down but that is up to you).
I do all this elsewhere, including perpetual
For pure dividends there are good options like:

- Altria keeps giving
Yes, it’s in my watch list
- Enegas is lovely (Spanish gas-company with fat dividends).
I don’t like Spain
- Oil refiners in the US used to be my main rec. (like MPC) but they ran up so-hard they are hard to recommend with full conviction.
I find them risky
I don’t like soft drinks
- Newell Holdings is well priced right now imo.
I don’t know enough of it
- IBM pays 4% dividend while being a respectable tech-stock.
I don’t see a reason to buy it for dividends or else.

Thanks for your analysis!
 
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That does not really matter if the real returns are a lot lower (which they are for that example). But during more bullish times the fund might be a true cash-cow certainly.

Maybe it is part of your tax strategy, but you are essentially taking on a lot of risk for a couple % above the risk-free rate (US T-bills, UK Gilts). During a market downturn you will likely suffer draw-downs, while if you own mainly bonds if / when there is some crisis:

1. Your coupon is stable
2. The value of your bonds will go up once QE and monetary easing set-in because rates on newly issued bonds will be lower than the ones you're holding.

I really think that a stable 5/6% yield on the safest instruments in the world are preferable over 8/10% on conjuncture sensitive companies, and funds that charge a 1 to 2% management fee for what is essentially a marketing gimmick (professional funds do not beat the market, nor are they more safe and can contain tail risk that is impossible to quantify).

4,594 holdings?
That fund is essentially a fund of indices. But the expense ratio is negligible so might not be worth the work to acquire them yourself. Sometimes an accumulative ETF can be better if accumulated dividends are not taxed (like in Portugal IIRC) but I generally like that particular Vanguard ETF over the MSCI World one.
 
That does not really matter if the real returns are a lot lower (which they are for that example). But during more bullish times the fund might be a true cash-cow certainly.

Maybe it is part of your tax strategy, but you are essentially taking on a lot of risk for a couple % above the risk-free rate (US T-bills, UK Gilts). During a market downturn you will likely suffer draw-downs, while if you own mainly bonds if / when there is some crisis:

1. Your coupon is stable
2. The value of your bonds will go up once QE and monetary easing set-in because rates on newly issued bonds will be lower than the ones you're holding.

I really think that a stable 5/6% yield on the safest instruments in the world are preferable over 8/10% on conjuncture sensitive companies, and funds that charge a 1 to 2% management fee for what is essentially a marketing gimmick (professional funds do not beat the market, nor are they more safe and can contain tail risk that is impossible to quantify).


That fund is essentially a fund of indices. But the expense ratio is negligible so might not be worth the work to acquire them yourself. Sometimes an accumulative ETF can be better if accumulated dividends are not taxed (like in Portugal IIRC) but I generally like that particular Vanguard ETF over the MSCI World one.
What do you think of Voo ?
 
What do you think of Voo ?
It is near-identical to the S&P 500 so it's a nice index to own. Not sure what the edge is over SPY though. The US, to me, is still the greatest market to own stocks in, as it is the most capitalistic country on earth with the richest consumers who are brainwashed from birth into consumption, even if it means taking multiple credit lines. The spirit of the American is also very much geared towards the new, which is why novel products and trends spread like an infectious disease across the country. The people of the US carry a magnificent drive and spirit while the country is one of the best places for rich people. It has it all (apart from history).

I don't live there nor would I ever, I appreciate history and the Old World too much (As expats say: "In America people have dreams, in Europe people have a life"), but in terms of stocks I always buy American. And buying American is a strategy that has never disappointed me in terms of returns, quite the contrary actually. The truth is that the American Empire is the largest on the planet, repatriating immense profits, with the strongest native consumer base on the planet, combined with a concentration of talent that continues to produce world-leading tech, a constellation of vassal states powerful enough to protect its interests everywhere on the planet and a military drilled to the core and zealous in their patriotism, combined with arguably the best military tech on the planet by a wide margin.

The only risk is Donald Trump, but I believe freedom is much too ingrained into the American mind to accept autocratic antics from him if he wants to say overrule elections results. And I believe that, however amoral they are, the capitalist class in the US will in the end eliminate him if he tries to destroy democracy.
 
I was lucky this year to pick stocks and have a 43% return on my IB.
 

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I was lucky this year to pick stocks and have a 43% return on my IB.
Congrats!
But as you said "got lucky"
Stock picking is a game of Warren buffett, not of average investors
Check QQQ made 49% this year
The main question with stocks picking or with tech stock like QQQ; would it be possible to generate the same next year?
This is why I like to diversify into all sectors throughout Voo.
 
Congrats!
But as you said "got lucky"
Stock picking is a game of Warren buffett, not of average investors
Check QQQ made 49% this year
The main question with stocks picking or with tech stock like QQQ; would it be possible to generate the same next year?
This is why I like to diversify into all sectors throughout Voo.
QQQ always performing well, and my stocks mostly were from NASDAQ, as you can see I started not in January, probably would get even better returns.

Most of the companies in SP500 are overpriced, I don't know what idiot created a theory with DCA into SP500, that's how you gonna lose and make returns even less than a market.
 
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Most of the companies in SP500 are overpriced, I don't know what idiot created a theory with DCA into SP500, that's how you gonna lose and make returns even less than a market.
How do you invest your regular income if not DCA (or value averaging for a slight optimization)?

I'm not sure accumulating waiting for a big enough correction to get a better entry is more effective as "time in the market beats timing the market".
 
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How do you invest your regular income if not DCA (or value averaging for a slight optimization)?

I'm not sure accumulating waiting for a big enough correction to get a better entry is more effective as "time in the market beats timing the market".
It’s way profitable just to lump sum.

You said it right, time in the market beats timing the market.

So
Just lump sum and wait, if you make money and get paid once a month, you can buy more stock which fairly valued using valuation models
 
So you DCA every month.
The biggest part of my networth is already invested in the stock market, for now I just save the money on savings accounts. once it dips or I will see good opportunities, I will buy more.

Dca is about buying every month at the same time and not looking at the prices, normally people automate it.
 
- Invest in a globally diversified ETF (around 62% of it is US). Do not FX hedge it (for most people).
- Calculate your stock exposure against your entire net worth (real estate, bonds, gold, crypto, cash etc etc) and find a % that is aligned with your investment horizon and risk tolerance
- US treasuries are attractive this year, maybe it would be wise to park some / most of your cash/bonds into 1 to 5 year bonds @4.5%, and resell on the secondary market when the stock market goes -10% and more to buy stocks on the cheap side.

This is not financial advice.
 
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- Invest in a globally diversified ETF (around 62% of it is US). Do not FX hedge it (for most people).
- Calculate your stock exposure against your entire net worth (real estate, bonds, gold, crypto, cash etc etc) and find a % that is aligned with your investment horizon and risk tolerance
- US treasuries are attractive this year, maybe it would be wise to park some / most of your cash/bonds into 1 to 5 year bonds @4.5%, and resell on the secondary market when the stock market goes -10% and more to buy stocks on the cheap side.

This is not financial advice.
Globally diversified etf Like Acwi historically had been underperforming Voo.
Also it is 60% USA so if USA economy falls, Acwi will fall as well.
The whole word is tied to one country: USA. If USA collapse, it would be end of humanity.
I get it that you are trying to diversify into global market but in this way you deprive your self from more profits.
I agree with strategy of diversification of assets, some in etf , some in crypto, own home. Own business.

It’s way profitable just to lump sum.

You said it right, time in the market beats timing the market.

So
Just lump sum and wait, if you make money and get paid once a month, you can buy more stock which fairly valued using valuation models
You literally said at first you don't do Dca. But now you say dca every month. Well that is the definition of dca, you don't buy 10$ worth of stocks daily, you buy it once a month. Like most of people are able to save 500$ a month and invest it using dca strategy. It is best. You simply don't know the future. If we compare portfolio of someone who has been investing using dca strategy and someone who was timing the market; result would be dca the winner.
I remember i read about this private bank that was looking into its most profitable clients, and they were shocked: Dead people!!!!
The dead did not time the market, did not wait for price to fall, the dead held their investment and kept re-investing.
Dead mode strategy!
 
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Also it is 60% USA so if USA economy falls, Acwi will fall as well.
USA will die slowly and gradually like the Great British Empire and all the other empires before it. Acwi will adapt to the new reality, as an index is a dynamic environment.
The whole word is tied to one country: USA. If USA collapse, it would be end of humanity.
rof/%
Hollywood did a great job.
 
Globally diversified etf Like Acwi historically had been underperforming Voo.
Also it is 60% USA so if USA economy falls, Acwi will fall as well.
The whole word is tied to one country: USA. If USA collapse, it would be end of humanity.
I get it that you are trying to diversify into global market but in this way you deprive your self from more profits.
I agree with strategy of diversification of assets, some in etf , some in crypto, own home. Own business.


You literally said at first you don't do Dca. But now you say dca every month. Well that is the definition of dca, you don't buy 10$ worth of stocks daily, you buy it once a month. Like most of people are able to save 500$ a month and invest it using dca strategy. It is best. You simply don't know the future. If we compare portfolio of someone who has been investing using dca strategy and someone who was timing the market; result would be dca the winner.
I remember i read about this private bank that was looking into its most profitable clients, and they were shocked: Dead people!!!!
The dead did not time the market, did not wait for price to fall, the dead held their investment and kept re-investing.
Dead mode strategy!
Past performance is not an indicator of future performance. Also, I am comfortable holding the whole world and my investments will automatically adapt to the changing realities including US getting less relevant over time. I will never replace diversification over the possibility of a higher profit with much less diversification.

I agree that going all USA is hard to resist based on its performance in the past 20 years but I am into buying the whole world financial market based on the respective countries weights.
 
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