Portfolio Two is our second longest lived portfolio, at 13 1/2 years. This portfolio is unique because the individual stocks have been sold off and replaced with ETF’s and a CD. See the details here or at the link on the right.
The beneficiary has invested $7000 and the trustee $14,200 for a total of $21,200. The current value is $38,428 for a gain of $17,228 or 81%, which is 7.7% a year when adjusted for the time value of cash flows.
Walking through the detailed transactions often helps you to find items you’ve overlook – we noted that the biotech ETF IBB had a stock split (3-1) in December 2017 so I have been understating the value of this portfolio by almost $2000 since that time on my consolidated view.
There were no stock sales last year so the only tax impacted item is dividends which were approximately $632 during 2017.
The portfolio is doing well. It is interesting to see that the VEO ETF has returned 33% including dividends since we’ve owned it but the HEFA ETF has returned 19% including dividends… the difference is due to the 10% or so fall in the US dollar vs a basket of other world wide currencies. HEFA is hedged so you get returns in original currencies while VEO also includes the net effect of the dollar on returns (which magnified returns in this case).