Portfolio Two Performance – Five Year Milestone

Portfolio One, as I noted above, has a ten year horizon and returned at an average rate of 4.6% over the ten year period.

Portfolio Two has a five year time horizon. Portfolio Two had a rougher ride because a longer portion of the time allotted fell during the “bust” period of the market. Portfolio Two barely ekes out a profit over this five year period, with a 5 year return effectively near zero.

This portfolio has had some big winners, including China Mobile and BHP which were sold for a gain, and some that were sold for a major loss, including Cemex out of Mexico and ICICI Bank (IBN) from India. We are still holding on to Nokia, even though it has an unrealized loss, because they seem to be a decent stock looking forward, and Diageo, partially because they just raised their dividend (which is a bullish sign).

From the beneficiary’s perspective, they put in $3000 so far, and it is worth $9100, so that is a significant return on their investment (ignoring the double match). This is good, but we hope to do better in the future than an effectively zero return over 5 years.

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