Strategy: αc Compound Portfolio II

Investment Objective

Aggressive Long-Term Capital Appreciation

Annualized Return

40.3%

Time
Horizon

5+ years

Rebalancing Frequency

N/A

A buy-and-hold portfolio consisting of a number of stable companies with high long-term growth.

About

The portfolio pursues a strategy that seeks to achieve equity-like returns with lower volatility and drawdowns compared to traditional equity through active ETF selection, risk management and diversification. It is thus expected to produce higher risk-adjusted returns than market indexes.

Performance

Portfolio + Compare with Initial Balance Final Balance Annual Return Annual Volatility Best Year Worst Year Max Drawdown Sharpe Ratio Sortino Ratio
$10,000 $566,632 40.3% 21% 97.1% 0% -31.9% 1.72 2.52
$10,000 $50,794 14.6% 18.3% 32.3% -4.6% -34.1% 0.84 1.18

  • Initial balance: The amount of starting capital used to invest in the asset or portfolio. In this case, we're starting with a $10,000 investment on December 2008.
  • Final balance: The amount of capital we've accrued over time as of December 2020.
  • Annual return: Also known as annualized return, or CAGR (Compound Annual Growth Rate), measures how much an investment has increased on average each year, during a specific time period. The time period in this case is approximately 12 year(s). Even a small difference in return can have a big impact on the final balance over a long period of time.
  • Annual volatility: Basically indicates how much, in percentage points, the investment can deviate from its annual return, under most circumstances. An investment with an annual return of 5% and an annual volatility of 10% would indicate returns from approximately -5% to 15% most of the time. A lower volatility is usually preferred to ensure more steady returns over time.
  • Best year: The best performance attained over its lifetime in a given year.
  • Worst year: The worst performance undergone over its lifetime in a given year.
  • Max drawdown: The largest percentage drop from a peak to a trough of an asset or portfolio, before a new peak is attained. Maximum drawdown is an indicator of downside risk over a specified time period.
  • Sharpe Ratio: The Sharpe ratio measures the performance of an investment compared to a risk-free asset, after adjusting for its risk. A Sharpe Ratio above 1 is considered good.
  • Sortino Ratio: The Sortino Ratio is a variation of the Sharpe ratio that only penalizes the investment for negative volatility/outcomes, and not for positive volatility. A Sortino Ratio above 1 is considered good.

Drawdown Periods

Simply said, a drawdown is the "pain" period experienced by an investor between a peak (new highs) and subsequent valley (a low point before moving higher). In the table below are the fifth largest drawdowns encountered for the portfolios/assets in question.

αc Compound Portfolio II

Drawdown Peak date Valley date Recovery date Duration
-31.92% 2020-02-19 2020-03-18 2020-06-03 76 days
-25.16% 2018-09-21 2018-12-24 2019-03-21 130 days
-18.47% 2011-07-08 2011-10-03 2012-01-18 139 days
-17.98% 2015-12-04 2016-02-09 2016-07-20 164 days
-14.9% 2010-04-26 2010-07-02 2010-09-29 113 days

The αc Compound Portfolio II took approximately 4 months on average to recover from a major drawdown.

S&P 500 (US Large Cap)

Drawdown Peak date Valley date Recovery date Duration
-34.1% 2020-02-19 2020-03-23 2020-08-18 130 days
-27.13% 2009-01-06 2009-03-09 2009-05-08 89 days
-19.35% 2018-09-20 2018-12-24 2019-04-12 147 days
-18.61% 2011-04-29 2011-10-03 2012-02-03 201 days
-15.7% 2010-04-23 2010-07-02 2010-11-04 140 days

The S&P 500 (US Large Cap) took approximately 5 months on average to recover from a major drawdown.

Underwater plot

The underwater plot shows you the drawdown periods on a chart. Whereas the performance chart usually gives you a positive viewpoint, the underwater plot gives you a pessimistic viewpoint. It helps you to visualize downtrends that occurred and how long it took for the portfolio's value to rebound to hit a new high after suffering a loss.

Annual Returns

Monthly Returns

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 - - - - - - - - - - - 0
2009 -3.3% 2.8% 11.8% 12% 4.3% 1.4% 11.9% 1% 6.8% 5% 3.6% 0.9%
2010 0.2% -0.3% 8.3% 7.4% -4.5% -6.9% 2.2% 1.1% 12.2% 6.1% 6.5% 0.6%
2011 5.4% 1% 4.5% 3.8% 3.2% -1% 3.1% -3.9% -11.5% 7.9% 0.5% 0.7%
2012 18.8% 5.5% 3.5% -0.8% -4.1% 4.9% -1.1% 8.2% 2.4% 1.3% 6.5% -0.7%
2013 17.5% 3.8% 6.9% 1.7% 2.9% 1% 3.7% 3.8% 7.9% 9.7% 8.3% 3.7%
2014 0.7% 2.8% -1.1% -1.9% 4.2% 0.8% 1.5% 5.8% -2.3% 4.6% -1.4% 0.2%
2015 2.9% 7.8% -2.2% 7.4% 5% 0.2% 9.9% -2.9% -3.8% 12% 5.6% -2%
2016 -7.7% -0.7% 5.1% 0.3% 6.6% -3.6% 7.1% 0.4% 1.9% 1% -0.1% 0.4%
2017 2.1% 3.8% 1.9% 2.4% 3.6% 0 7% 0.2% 7% 5.2% -0.8% 0.4%
2018 9.9% 3.4% 1.3% 5.4% 8% 5.4% 3.1% 5.5% 0.8% -11.5% 0.7% -8.6%
2019 14.6% 5.5% 2.3% 5.7% -4.6% 5.4% 3.2% 2.2% -3.8% 5.9% 7.2% 4.7%
2020 5.7% -3.1% -7.9% 13.1% 9.3% 10.4% 4.4% 3.6% -3.8% -3.6% 9.8% 0.1%
Pos 83.3% 75% 75% 83.3% 75% 72.7% 91.7% 83.3% 58.3% 83.3% 75% 75%
Avg 5.6% 2.7% 2.9% 4.7% 2.8% 1.6% 4.7% 2.1% 1.2% 3.6% 3.9% 0%