Real life portfolio performance 2015 and retrospective

2015 Values	Performance indicator		Comments
Absolute return	$, K	%	This is without taking into account accumulated $ 48 K
	-25	-9
Relative return	S&P 500, %	Portfolio, %	Exposure to emerging markets and energy sectors
	0.8	- 9
Cash accumulated in 2010 money	Planned $, K	Actual $, K	On target.
	48	48
Personal plan in 2010 money	Planned $, K 330	Actual $, K 244

The  target is not becoming currently achievable, as at the beginning of the year I have had only $244 K in 2010 money, so I had to reduce it for 2016, so it is realistic:

Year	2008	2010	2011	2012	2013	2014	2015	2016
Money of the day actual	153,400	119,800	165,600	226,800	298,400	288,608	295,536
Target						370,000		350,000
Inflation %		2	3.5	3	4	4	3	4
Cumulative inflation		1.02	1.06	1.09	1.13	1.18	1.21	1.26
2010 money	153,400	117,451	156,967	209,032	265,244	244,583	244,244	277,777

In another words if in 2010 you would have $ 10,000 and keep it, it worth $7,930 today.

Performance of my investments over the last 5 years (all in €):

	2012	2013	2014	2015	2016
Money of the day invested – cumulative	44,460	173,770	189,638	202,593	286,492
Shares value -	44,886	180,827	163,000	155,745	208,391
Inflation adjusted U.S.	45,794	182,108	205,895	225,416	312,600
Inflation adjusted U.K.	45,883	182,202	205,993	227,706	314,981
S&P 500	48,639	217,099	262,768	277,947	367,232
Free cash	94,500	23,454	53,087	92,386	21,093
Dividends received			5,719	5,321
If invested in S&P 500			4,730	5,559

Notes: for 2016 this is an assumption that S&P 500 will be in line with the inflation and will growth by 4%.  However, value of my today is as of today. If they will perform in line with S&P500 they would worth ~ 220 K.

        I was focusing on dividends, while sitting on the pile of cash.  In a way in prevented me for going even in a deeper loss.  In 2014 it was a winners, as  I received almost 1,000 a year more.  By 2015 S&P500 would outperform.

         I was thinking long and hard on whether to publish this performance comparison. It would actually be even grimmer, as EUR lost to USD almost 20% over the period of 4 years.  This tendency (EUR depreciating to USD) is likely to accelerate.  Western Europe allowed itself luxury of sanctions, conflicts and indulging into expensive politicking.

Admittedly, many funds underperformed, this should not be treated as an excuse:

	2012	2013	2014	2015
Vanguard FTSE 100		18.5%	0.64%	-1.4%
Vanguard Emerging markets		-4%	1.1%	-15.5%
U.K. Government Bond		-4.2%	14.8%	0.3%
S&P500	13.4%	22.1%	12.8%	0.8%
DAX (German market)	31.8%	21.3%	3.9%	-5.64%
Mine	1.0 %	4.1%	-14%	- 23.1 %

Mainly for the same reason. In the UK (FTSE 100) – 12.9 % of the index are energy companies aka oil & gas.

          On the other hand, many of the Energy (euphemism for  oil & gas) companies lost between 20 to 50% of the market value last 18 months.  This was a good example on why individual stocks selected wrongly could compromise your goals. The gap over 5 years is 160 K! If I would simply keep all the money on a bank account, I would have today 286 K, instead of 208 K.

          The results made me thinking about effectiveness of my investment strategy and the emotional attachments.  I have now committed to invest in index ETFs (exchange-traded funds) in S&P 500, DAX (German market) and some bond ETFs.  I will consider FTSE, however the UK is now actively threatening to break up from EU, while major manufacturers (Rolls Royce, Jaguar Land Rover) are moving new plants overseas only.  

I will only do the speculative investment with side and unexpected income above my annual targets.