Sunday head scratcher

[NilesMike]

I was doing a manual backtest on some option strategies and one thing led to another.
I decided to see how my stock holdings did compared to S&P from 2009 to present.
I'm satisfied with DGI but am taking it on the chin in terms of capital appreciation.
S&P is up 300% +/-. I have 3 names beating that, MPC; HD and O
A couple others are in the 200% range (w/o calculating DRIP)
Most are nowhere near S&P total return.

How are you all fairing?

[fenders53]

Just played around a bit and there was good news and bad news. 

Most of my real port was in the SP500 and Russell until last year, so life is good.  I did have a few smallish taxable ports I held just a few stocks in through your entire 2009 to present period.

The beloved DGI JNJ- 11.27% vs 14.34%  That's a pretty significant miss but I can live with it.  

XEL, my best stock ever.  15.77%,  Not reality though because I bought every dip like I believed for 20+ years.  It's about a 10 bagger for me.  A Utes of all things is my best pick ever.

PFE was underwhelming.  11.6% during your date range.  Problem is I bought most of it around 1998 so only 5.27%  Take PFE back to 1985 and $10,000 is almost a cool half a milly.  I am only sitting on like $4K Valuation for every $1000 invested.  21 yrs ago so pretty weak.  

Had a smallish trading account I played with and got burned bad on KMI and SDRL 4-5 years ago.  Let's not talk about a few penny stocks. It was supposed to be fun but it wasn't lol. That was gambling money.  Good thing because I lost over half of it and that's with some good stocks like AAPL and MSFT mixed in their. That was a horrible adventure.

Took complete control of my retirement funds last year.  You'll have to tell me what you think of my 2019 returns through NOV.  My modest goal was minimum 4% through good and bad years, with a real shot at 6-8%.  This port has been about 50% cash on average all year.  The other half DGI and Utes with my extreme use of put and call sales to further reduce risk since I thought the big one was surely coming by now.  Anyway my 2019 return is about 17% overall.  I can live with that given my asset allocation.  I think the S&P is up about 27% so risk on would have obviously done better.  IMO my risk posture was only 40% of the S&P most of the time.

[NilesMike]

Risk adjusted return is probably an important consideration, you are right.

[fenders53]

(12-09-2019, 05:44 PM)NilesMike Wrote: Risk adjusted return is probably an important consideration, you are right.

It has EVERYTHING to do with your age.  I invested with my hair was on fire until I was 45.  I looked like Rocky after the first ten years.      Now I am here preaching against it.  I never stopped beating myself up for the bonehead risks I took.  After a few decades I realized the value of learning those lessons when I only had $20K to lose.  I shudder to think what losing $300K unnecessarily would feel like.  I'll never discourage a young person from getting deep in equities.  Just know when it's time to starting compartmentalizing some of your port.

More on topic, DGI is a solid long-term strategy but adding some S&P500 and a few quality high growth stocks seems prudent.  Here is my biggest fear for DGI investors, and that includes a lot of folks on this forum.  I think there is a false sense of security that being all in on dividend growers is going to spare you pain in the next recession.  Look at the PEs on some of the favorite consumer staples.  It's delusional to think you aren't likely to lose half of your capital anyway, after you underperformed the market the ten years prior.  Time will tell.  I need to be less conservative though.  A few more growth stocks would make sense in my port as long as I am prepared to ride out a 10 year wait for that part of my port to get back to even.