How Did You Do in 2017?

Asset allocation, risk, diversification and rebalancing. Pros/cons of hiring a financial advisor. Seeking advice on your portfolio?
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33314
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: How Did You Do in 2017?

Post by AltaRed »

Okay. that makes more sense with XIC not being an equal component.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
User avatar
Norbert Schlenker
Veteran Contributor
Veteran Contributor
Posts: 7952
Joined: 16 Feb 2005 09:56
Location: An Argument Surrounded By Water
Contact:

Re: How Did You Do in 2017?

Post by Norbert Schlenker »

The USD/CAD exchange rate on 2016-12-30 was 1.3427; on 2017-12-29 it was 1.2545. USD returns should be adjusted by a factor 1.2545/1.3427 = 0.9343.

Here are the total returns of each component in 2017, as published on the sponsor's website.

VTI: 21.2% in USD ... 13.2% in CAD
VEA: 26.5% in USD ... 18.2% in CAD
XIC: 9.6% in CAD

No linear combination with non-negative coefficients of those three returns can result in an overall portfolio return of 18.7%.

So something's missing. Leverage? A short position in XIC? Contributions unaccounted for?
Nothing can protect people who want to buy the Brooklyn Bridge.
couponstrip
Contributor
Contributor
Posts: 552
Joined: 14 Jan 2007 15:20

Re: How Did You Do in 2017?

Post by couponstrip »

Yes, something is definitely off if those are the returns from each ETF for 2017. I've just taken the yearly return figure from our brokers' spreadsheet for each account and averaged them by weight. Let me take a closer look tonight.
couponstrip
Contributor
Contributor
Posts: 552
Joined: 14 Jan 2007 15:20

Re: How Did You Do in 2017?

Post by couponstrip »

Ok, I had a chance to take a closer look. Norbert's first assumption/instinct was exactly right. My quoted returns did not account for the loss of value of the CAD over the year.

My broker (IB) gives a "mark to market" summary and breaks this down into CAD and USD holdings. So I took the profit numbers from those two tables and computed them. The USD table quotes the mark-to-market change in value in USD and the final line of this table converts the year's profit to value in CAD without adjusting for the profit/loss in currency value over the year. That is a third "mark to market" table underneath, I have discovered which has a large negative amount for 2017.

So our 2017 returns are not nearly as impressive as I thought at 12.1%. Thanks a LOT Norbert. :roll: :wink:

On the bright side, we probably did better than I thought (at the time) earlier this decade when the CAD dollar fell so much.

Thanks for helping me sort this out :)
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16030
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: How Did You Do in 2017?

Post by kcowan »

Another good example of not trusting what the broker gives you. DIY means exactly that!
For the fun of it...Keith
couponstrip
Contributor
Contributor
Posts: 552
Joined: 14 Jan 2007 15:20

Re: How Did You Do in 2017?

Post by couponstrip »

Well that's very generous, Keith, but it's more like: If you are going to DIY, make sure you understand what your broker is reporting on its reports. :)

My interest in tracking this carefully did fade about 2 years after learning to DIY. It seems to me that tracking yearly returns is largely an academic exercise, but fun to look at from time to time as long as you (and by you, I mean me) do it right.

What matters in the end is the average price paid and what prices I eventually sell at, the latter still years away.
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5412
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: How Did You Do in 2017?

Post by SQRT »

couponstrip wrote: 16 Jan 2018 17:52 Well that's very generous, Keith, but it's more like: If you are going to DIY, make sure you understand what your broker is reporting on its reports. :)

My interest in tracking this carefully did fade about 2 years after learning to DIY. It seems to me that tracking yearly returns is largely an academic exercise, but fun to look at from time to time as long as you (and by you, I mean me) do it right.

What matters in the end is the average price paid and what prices I eventually sell at, the latter still years away.
It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
pmj
Veteran Contributor
Veteran Contributor
Posts: 3408
Joined: 27 Feb 2005 18:15
Location: Ottawa

Re: How Did You Do in 2017?

Post by pmj »

A friend had a "full-service" account at CIBC Wood Gundy ... where the account returns were compared to the TSX price index ... not the total return index :shock:. On that basis, the returns were pretty close to the benchmark :?.
Peter

Patrick Hutber: Improvement means deterioration
ig17
Veteran Contributor
Veteran Contributor
Posts: 3418
Joined: 21 Feb 2005 20:54

Re: How Did You Do in 2017?

Post by ig17 »

Norbert Schlenker wrote: 13 Jan 2018 17:07 My 20 year time weighted returns are about 8.5% per year.
That's a great performance record. You beat a passive benchmark*** by ~1.5% over 20 years.

Do you know the source(s) of your outperformance? Inquiring minds are curious. :wink:

*** benchmark definition, picked arbitrarily by me:

All Canadian Bonds: 20%
Real Return Bonds: 20%
TSX Composite: 20%
Wilshire 5000: 20%
MSCI EAFE: 10%
MSCI Emerging Markets: 10%

20 year CAGR: 7.145% before fees, per Norm's asset mixer.
DenisD
Veteran Contributor
Veteran Contributor
Posts: 4080
Joined: 19 Feb 2005 01:24
Location: Calgary

Re: How Did You Do in 2017?

Post by DenisD »

pmj wrote: 16 Jan 2018 22:13 A friend had a "full-service" account at CIBC Wood Gundy ... where the account returns were compared to the TSX price index ... not the total return index :shock:. On that basis, the returns were pretty close to the benchmark :?.
A friend of mine had the same thing happen at Scotia McLeod. Maybe it's standard practice? This was 4 or 5 years ago.
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16030
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: How Did You Do in 2017?

Post by kcowan »

SQRT wrote: 16 Jan 2018 18:35It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
Yes I think TD has a good set of performance tools now. I have maintained my spreadsheet since the 90s when I used 3 major brokers. The best performer then was Canaccord. But now that I am buy and hold for divvies and total return, TDDI seems to do it all. I am reluctant to rely on them for various reasons. But if they ever get their act together, they would be my choice.
For the fun of it...Keith
User avatar
GreatLaker
Contributor
Contributor
Posts: 660
Joined: 16 Dec 2014 13:02
Location: Toronto

Re: How Did You Do in 2017?

Post by GreatLaker »

I have a basic 60/40 retired guy indexed couch portfolio. 40% fixed income is split half into 5-year GIC ladder, and half into VAB. 60% equity is split 1/3 each into ETFs for Canada, US and global (including EM).

TWRR (Bogleheads spreadsheet): 1 year 9.8%, 3 year 7.1%, 5 year 8.5%
MWRR (Excel XIRR): 1 year 10.2%, 3 year 7.6%, 5 year 7.7%

Colour commentary:
  • Had a lot (6 figures) in cash and HISA at times to use as bridge funding for a real estate deal, lowering my return somewhat
  • 5-year GIC ladders were built since 2015 so not all of them are 5 year GICs... yield should increase gradually until they are all 5 year term
  • MW return is higher than TW return because my RE deal closed in Sept and I invested the $ just as the market started to go "Wheeeee" :rofl:
  • Over the past 6 years I moved all of my investments from 2 expensive advisors to indexed portfolio with TDDI
  • Now I have all my retirement portfolio built and retirement house purchased. Time to relax and enjoy! :D :beer:
When I was young, I was poor. Now, after years of hard work, I am no longer young.
User avatar
GreatLaker
Contributor
Contributor
Posts: 660
Joined: 16 Dec 2014 13:02
Location: Toronto

Re: How Did You Do in 2017?

Post by GreatLaker »

SQRT wrote: 16 Jan 2018 18:35 It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
They do, except that performance can only be aggregated for all accounts under the same 6 digit root account. I have 2 LIRAs, each under a different root account from my non-LIRA accounts, so TD cannot display performance for my entire portfolio. I use Longinvest's wonderful Boglehead spreadsheet as my main tool for calculating returns.
When I was young, I was poor. Now, after years of hard work, I am no longer young.
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5412
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: How Did You Do in 2017?

Post by SQRT »

GreatLaker wrote: 17 Jan 2018 11:01
SQRT wrote: 16 Jan 2018 18:35 It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
They do, except that performance can only be aggregated for all accounts under the same 6 digit root account. I have 2 LIRAs, each under a different root account from my non-LIRA accounts, so TD cannot display performance for my entire portfolio. I use Longinvest's wonderful Boglehead spreadsheet as my main tool for calculating returns.
I can see that, but I only have 2 accounts really. The main taxable portfolios for my wife and I. The TFSA’s are not really material at this point.
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16030
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: How Did You Do in 2017?

Post by kcowan »

GreatLaker wrote: 17 Jan 2018 11:01
SQRT wrote: 16 Jan 2018 18:35It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
They do, except that performance can only be aggregated for all accounts under the same 6 digit root account. I have 2 LIRAs, each under a different root account from my non-LIRA accounts, so TD cannot display performance for my entire portfolio. I use Longinvest's wonderful Boglehead spreadsheet as my main tool for calculating returns.
Yes by fluke of history, I have 4 root accounts, 1 for each of me and spouse, 1 for RRIF, 1 for spousal inheritance. I have repeatedly asked TD to allow consolidation across these in their various views, and so far no love.
For the fun of it...Keith
User avatar
Norbert Schlenker
Veteran Contributor
Veteran Contributor
Posts: 7952
Joined: 16 Feb 2005 09:56
Location: An Argument Surrounded By Water
Contact:

Re: How Did You Do in 2017?

Post by Norbert Schlenker »

ig17 wrote: 16 Jan 2018 22:30 Do you know the source(s) of your outperformance? Inquiring minds are curious. :wink:
There's a lot of annual tracking error relative to any benchmark (I use FPX Balanced because it's easy; 20 years of that is around 6%). In the early years, it was because I was a fairly frenetic trader. For the past 15, having settled largely into sloth, most of the tracking error is due to the considerable part of the portfolio that is long duration preferreds, which no mixed asset class benchmark includes.
Nothing can protect people who want to buy the Brooklyn Bridge.
DanH
Veteran Contributor
Veteran Contributor
Posts: 2170
Joined: 21 Feb 2005 14:25
Contact:

Re: How Did You Do in 2017?

Post by DanH »

You could always insert a preferred ETF as a component of your benchmark to include the asset class. Or just chalk it up to a value-added active decision on your part!
User avatar
adrian2
Veteran Contributor
Veteran Contributor
Posts: 13331
Joined: 19 Feb 2005 08:42
Location: Greater Toronto Area

Re: How Did You Do in 2017?

Post by adrian2 »

GreatLaker wrote: 17 Jan 2018 11:01
SQRT wrote: 16 Jan 2018 18:35 It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
They do, except that performance can only be aggregated for all accounts under the same 6 digit root account. I have 2 LIRAs, each under a different root account from my non-LIRA accounts, so TD cannot display performance for my entire portfolio. I use Longinvest's wonderful Boglehead spreadsheet as my main tool for calculating returns.
[offtopic]
My first TDDI account, from two decades ago (at that time, Green Line), has a 6 digit root number.
Since then, they ran out of numbers and newer accounts have a 6 character root number.
Imagefiniki, the Canadian financial wiki
“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]
beachcomber
Contributor
Contributor
Posts: 244
Joined: 08 Jan 2017 13:51

Re: How Did You Do in 2017?

Post by beachcomber »

8.1% return from 6 accounts with PH&N. 90% of investment $$
7.5% return from beachcomber's Qtrade account (equities and etfs). 10% of investment $$
I love a good night's sleep - as well as an afternoon nap :-)
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5412
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: How Did You Do in 2017?

Post by SQRT »

kcowan wrote: 17 Jan 2018 14:07
GreatLaker wrote: 17 Jan 2018 11:01
SQRT wrote: 16 Jan 2018 18:35It seems to me that the DIY brokers have pretty good performance tools now. I think TDDI does for sure. I’m considering dropping all my performance IRR spreadsheets and just using their performance metrics.
They do, except that performance can only be aggregated for all accounts under the same 6 digit root account. I have 2 LIRAs, each under a different root account from my non-LIRA accounts, so TD cannot display performance for my entire portfolio. I use Longinvest's wonderful Boglehead spreadsheet as my main tool for calculating returns.
Yes by fluke of history, I have 4 root accounts, 1 for each of me and spouse, 1 for RRIF, 1 for spousal inheritance. I have repeatedly asked TD to allow consolidation across these in their various views, and so far no love.
Ok but if you have more than one account, why couldn’t you just take the dollar weighted average of them to approximate the total return?
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16030
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: How Did You Do in 2017?

Post by kcowan »

SQRT wrote: 18 Jan 2018 03:19Ok but if you have more than one account, why couldn’t you just take the dollar weighted average of them to approximate the total return?
Sure and add in 5 more accounts from other sources and voila my needed spreadsheet. :roll:
For the fun of it...Keith
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5412
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: How Did You Do in 2017?

Post by SQRT »

kcowan wrote: 18 Jan 2018 09:00
SQRT wrote: 18 Jan 2018 03:19Ok but if you have more than one account, why couldn’t you just take the dollar weighted average of them to approximate the total return?
Sure and add in 5 more accounts from other sources and voila my needed spreadsheet. :roll:
Right :lol: but wouldn’t it be a lot easier to simply average the returns of 5 accounts than to track cash flows for each one? In my case ,at least, it’s the cash flows that take the time.
User avatar
GreatLaker
Contributor
Contributor
Posts: 660
Joined: 16 Dec 2014 13:02
Location: Toronto

Re: How Did You Do in 2017?

Post by GreatLaker »

SQRT wrote: 18 Jan 2018 03:19
kcowan wrote: 17 Jan 2018 14:07
GreatLaker wrote: 17 Jan 2018 11:01They do, except that performance can only be aggregated for all accounts under the same 6 digit root account. I have 2 LIRAs, each under a different root account from my non-LIRA accounts, so TD cannot display performance for my entire portfolio. I use Longinvest's wonderful Boglehead spreadsheet as my main tool for calculating returns.
Yes by fluke of history, I have 4 root accounts, 1 for each of me and spouse, 1 for RRIF, 1 for spousal inheritance. I have repeatedly asked TD to allow consolidation across these in their various views, and so far no love.
Ok but if you have more than one account, why couldn’t you just take the dollar weighted average of them to approximate the total return?
If it is that easy why doesn't TDDI do it automatically for us? :roll:

In the past I have had large enough cash flows that a simple dollar weighted average would not have been accurate. Maybe in the future that would work for me, but then all the effort I have put into my spreadsheets would be wasted. :(
When I was young, I was poor. Now, after years of hard work, I am no longer young.
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5412
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: How Did You Do in 2017?

Post by SQRT »

GreatLaker wrote: 18 Jan 2018 10:08
SQRT wrote: 18 Jan 2018 03:19
kcowan wrote: 17 Jan 2018 14:07 Yes by fluke of history, I have 4 root accounts, 1 for each of me and spouse, 1 for RRIF, 1 for spousal inheritance. I have repeatedly asked TD to allow consolidation across these in their various views, and so far no love.
Ok but if you have more than one account, why couldn’t you just take the dollar weighted average of them to approximate the total return?
If it is that easy why doesn't TDDI do it automatically for us? :roll:

In the past I have had large enough cash flows that a simple dollar weighted average would not have been accurate. Maybe in the future that would work for me, but then all the effort I have put into my spreadsheets would be wasted. :(
Don’t know why they don’t. You should ask them. I wonder how inaccurate a simple average would be? I averaged my two portfolios’performance and compared to my spreadsheet. Was very close. I set the spreadsheet up in an hour years ago. The big time hog is tracking the cash flows.
chufinora
Contributor
Contributor
Posts: 769
Joined: 12 Oct 2009 15:03
Location: Ottawa

Re: How Did You Do in 2017?

Post by chufinora »

SQRT wrote: 18 Jan 2018 11:10 Don’t know why they don’t. You should ask them. I wonder how inaccurate a simple average would be? I averaged my two portfolios’performance and compared to my spreadsheet. Was very close. I set the spreadsheet up in an hour years ago. The big time hog is tracking the cash flows.
I have asked them several times both using the feedback link and when asked how we are doing by a rep. We have 6 root accounts so performance tracking is pretty useless to me as-is. The ability to track transaction history beyond 3-4 months (Without digging into statements) would be higher priority for me, and I have asked for that at least 15x over past 5 years (Never with any response other than that would be good idea from a rep).
Post Reply