Compared to 2022 my main portfolio in 2023 did better absolutely but worse relative to the market. As usual I will use VOO, Vanguard's S&P 500 index tracking ETF, as my market benchmark. In 2022 my portfolio lost 10.79% but outperformed VOO which lost 18.17% by 7.38%. In 2023 my portfolio was up 15.66% but trailed VOO which was up 26.13% by 10.47%. For the two years combined I trailed slightly up 3.18% versus 3.21% for VOO.
In October 2023 I doubled my positions in SCHD and VIG (two ETFs that buy stocks with growing dividends) and increased my position in VPU (Vanguard's utility sector fund). In what follows I will account for these purchases as if they were made by borrowing from my cash position and repaying the loans without interest at the end of the year. This is simple but a little biased.
At the start of 2023 I was 45.55% invested in VOO, 30.01% invested in individual stocks, 13.83% invested in ETFs (other than VOO) and 10.61% invested in cash. During year my VOO position matched the market. My stocks returned 5.44% underperforming by 20.69 contributing 6.21% to my overall underperformance. My ETFs returned 11.20% underperforming by 14.95% contributing 2.06% overall. My cash position returned 5.28% underperforming by 20.85% which contributed 2.21% overall. This adds up to 10.48% overall underperformance in good agreement with the actual 10.47%.
Only two of my stocks (JPM and KD) beat the market. Seven had negative returns (ED, CVS, XOM, MET, NSC DGX, SOUHY and WDS). One of my ETFs (VGT) beat the market while two (VDE and VPU) had negative returns.
Over the long term I continue to trail the market but perhaps with less volatility as I tend to outperform in bad markets but underperform in good markets. This may be safer but leads to underperformance in the long bull market we have seen since the 2009 bottom. Fortunately my approximately 50% position in VOO has kept me from trailing too badly.
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