Statistics & Performance

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Statistics & Performance

As a good friend often likes to remind me, it costs someone nothing to talk about investing if they don’t show their own investment performance. I’ve written about investing for a number of years and managed a portfolio of investments since 2012, although it wasn’t until 2015 that I established my longer-term targets and began collecting and tracking my portfolio performance in a detailed and comprehensive way.

In 2020, I took the decision to finally publish my track record as part of my annual review and now update this annually, in addition to extracting various portfolio metrics on this page.

Annual Returns

Since 2015, my portfolio has generated an annualised return of 8.25% inclusive of costs. Prior to this, I held a small number of positions that generated marginal returns – from various notes kept at the time, I believe in the range of 3-4% annualised, but unfortunately, I wasn’t as meticulous with my record-keeping so can’t be more precise. The account at the time was entirely liquidated as part of a transfer to a new broker and during that process, I developed a more precise method of record keeping and performance monitoring due to research which indicated that I was underperforming the broader market quite severely.

To remedy this, I decided to take a much more professional, strategic approach to investing, the first part of which was to establish long-term investing targets, an investment strategy, and regular ‘reporting’ to monitor performance.

Setting my investing targets was a little bit like asking ‘how long is a piece of string’. My starting point was to explore rates available to UK cash savers, which at the time I began investing, sat at 2-3% annual interest. I researched annuity rates (which were slightly higher at 4-5%) and finally looked into historical returns for equities (in the UK, this has been around 5.5% a year since the early 1900s). As such, I set myself a five-year target of 7.5% annualised returns, and a longer-term goal of generating 10-15% annualised returns after ten years.

If I was to outperform a market index, which is a feat that the vast majority of investors fail to do, then I would need a combination of skill, knowledge, competence, and luck. It seemed arrogant to assume that I would naturally have these four things (clearly my earlier performance indicated that I was lacking in these areas) but I believed that with time and hard work I would be able to improve on at least three of the four.

I also had little idea just how hard the challenge was going to be and giving myself a long runway of ten years seemed like a good way to relieve unnecessary pressure and allow time to gradually and carefully build a robust and well-balanced portfolio without taking outsized risks to generate immediate returns.

YearAnnual ReturnAverage Yield

Winners & Losers

Set out below are two sets of data that indicate the number of profitable months in my portfolio, the percentage of profitable investments I’ve made, and the average profit of these investments. The calculation for winning months was relatively easy (how many months of the year did my portfolio increase in value) although calculating profitable investments was slightly more complicated. Rather than measuring the current performance of every investment made in that year, the table below only measures the performance of investments made in that year that have since been fully liquidated.
YearWinning MonthsLosing Months
20156 (50%)6 (50%)
20169 (75%)3 (25%)
20179 (75%)3 (25%)
20186 (50%)6 (50%)
20197 (58%)5 (42%)
20206 (50%)6 (50%)
20219 (75%)3 (25%)
20225 (41%)7 (59%)
20236 (50%)6 (50%)
Average7 (58%)5 (42%)
YearProfitable InvestmentsNon-Profitable InvestmentsAverage Profit

Average Holding Period

On average, I hold positions for just over two years and sell investments for an average profit of 15%, a figure that reflects my preference for selling investments in companies that are failing for perform. These companies tend to be poor investments that generate negligible, if not entirely negative returns, depressing the average but protecting portfolio performance by ensuring I hold onto long-term winners. Over time, I expect to see ‘average profit’ for earlier years increase as more profitable, long-term investments mature and become reflected in the average profit column. I’ve previously written about my goal of keeping my loss-making investments to around a third of all positions; a target which I am currently achieving with around 70% of my investments being profitable over the long-term.

My average profit has increased over time although this metric experiences ‘lag’ as many of the investments I made years ago have not yet been closed out. I could spend a few hours calculating their current annualised returns but frankly, I struggle to simply find the time to produce articles for the blog so I only update these figures annually.

Alongside my percentages of profitable investments, I also occasionally get asked about the size of my portfolio, how many investments I make a year, and roughly how long I hold an investment for. I describe myself as a ‘buy and hold’ investor – a view that is largely reflected in my holding period of over two years. It is worth noting that the holding time set out below also ignores the investments I have not yet liquidated and so over time this average will continue to rise.

YearNumber of TradesPortfolio Size @ Year StartAverage Holding Time of Sells
2015131010 Months
2016151418 Months
2017151826 Months
2018272735 Months
2019443138 Months
2020153239 Months
2021523225 Months
2022193812 Months
2023124220 Months
Average242225 Months

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