2019 Portfolio Review

After slightly outperforming the market in 2018 my brokerage account under performed again in 2019. This time by almost 6%. Since the market as represented by VOO (Vanguard's S&P 500 index fund) was up 31.14% (28.72% capital gain, 2.42% income) my return of 25.28% (22.25% capital gain, 3.03% income) was still pretty good.

The biggest contributor to my under performance was the fact that my portfolio was not fully invested.  I started the year 12.31% in cash and after one stock purchase in October ended the year 12.23% in cash. In a very good year for the market this cash position (which only earned a bit over 2% in interest) was a substantial drag contributing 3.53% to my under performance. My individual stocks also lagged the market returning 26.09% (22.25% capital gain, 3.83% income) and contributing 1.52% to my under performance. As did my ETFs (besides VOO) returning 24.45% (20.55% capital gain, 3.90% income) and contributing .80% to my under performance.  This adds up to 5.85% of under performance in good agreement with the actual 5.86%.

Only two of my individual stocks outperformed by more than 10% (JPM, TGT).  The rest were either within 10% of the market return (ALL, BBL, BLK, ED, INTC, IBM, MET, NSC, UNH) or lagged the market by at least 10% (BNS, CM, CAT, CVS, XOM, PEG, SOUHY, TD, WFC, WBK).  One of my ETFs lagged the market by over 10% (VDE), the others lagged by less than 10% (VNQ, VPU, VYM).

As noted above I made one purchase during the year.  I bought some UNH (a health insurance company) on Columbus day.  This was good timing for once as UNH came out with a good earnings report and the stock performed well for the rest of the year. Hopefully it will do as well as my AET investment.