2nd Quarter 2016 Portfolio Returns

Year-To-Date Portfolio Returns

January 1st through June 30, 2016

I reported at the first quarter report (March 31, 2016) that my portfolio was down about $50,000 in January, 2016. Because of the fed dovish comments about rate increases, the economy is plugging along, and oil prices going up, the stock market roared back. And my portfolio followed suit, just like soldiers marching to the general’s order.

The DOW, S&P 500 Index and my Portfolio increased into the record books. What a year so far!

My portfolio is up $125,000 year-to-date at record highs, a 4.9% return for the year. The June jobs report was so good that the both the DOW and the S&P 500 Index shot up to record levels.

Here are the results of how each fund in my portfolio performed for the first six months of 2016.

The crucial Stock/Bond split also remains is 30% stock and 70% bonds/cash (Click here for details of rebalancing my portfolio).

For those “geeky” investors who want to look under the hood of my choice of funds, Morningstar has hundreds of statistics of each mutual fund, index fund, ETF or individual stocks and bonds known to humankind. Let me explain some of the definitions that are found in the next table below:

1. The standard deviation is a statistical measure that reflects the volatility: stocks would have a higher standard deviation than bonds. Notice that the balanced fund Vanguard Wellesley has a low standard deviation because its contains 65% bonds and only 35% stocks. The higher this number, the more risk.
2. I don’t pay much attention to the Morningstar Rating for Funds because I construct my portfolio according to the major asset classes, never solely on past performance.
3. The % weight is the percent of my total portfolio which is invested in the individual investments. The Total Bond Market Index contains over 52% of my portfolio. This index has three different bonds, corporate, GNMAs and treasuries.
4. The Costs are illustrated in a separate table above.
5. Alpha measures if the investment returned higher, about the same or lower than the market averages.
6. A beta measurement less than 1 indicates that the investment is less volatile than the market, while a beta more than 1 indicates that the investment is more volatile than the market.
7.  Credit quality is the measure of how likely you will get your money back. AAA is the highest rating and -B or lower is the lowest, and highest risk rating.
8. % Turnover Ratio is the percent of the fund that is sold and bought during the last year. I want a very low turnover rate in my portfolio. I loathe excessive buying and selling in my portfolio.
9. Lastly, each investment returns for each year since 2012.
10. Morningstar has hundreds of additional statistics. It’s all free.

Morningstar Statistics About My Portfolio Holdings

Steve’s Bio

*Stephen A. Schullo, Ph.D. (UCLA ’96) taught in the Los Angeles Unified School District (LAUSD) for 24 years and UCLA Extension teaching educational technology to student teachers. Steve wrote investment articles for the United Teacher-Los Angeles (UTLA) newspaper for 13 years. Thrice featured retirement plan advocate in the Los Angeles Times and U.S. News and World Report. He co-founded an investor self-help group (403bAware with Sandy Keaton) for teacher colleagues and wrote 5,000 posts in three investment forums since 1997. Frequently quoted by the media, testified at California State legislative hearings and honored with the “Unsung Hero” award by UTLA for his retirement planning advocacy. For the last ten years, he serves on LAUSD’s Investment Advisory Committee as a “Member-at-Large” and former co-chair. The committee monitors the district’s 457b/403b/PARS of 55,000 former and current LAUSD employees, worth $2.2 billion in total assets. Lastly, Steve and his late husband, Dan, were featured participants for the award-winning documentary, PBS Frontline: The Retirement Gamble, aired April 23, 2013. Steve is the author of an additional new book, released a year ago, “Fighting Powerful Interests: Educators Challenge Tax-sheltered Annuities and WIN!” A story of how a few LAUSD educators knowing little about retirement planning ended up with an awarding winning 457(b) plan.

Lastly, Steve and his late husband, Dan, were featured participants for the award-winning documentary, PBS Frontline: The Retirement Gamble, aired April 23, 2013. Steve is the author of an additional new book, released a year ago, “Fighting Powerful Interests: Educators Challenge Tax-sheltered Annuities and WIN!” A story of how a few LAUSD educators knowing very little about retirement planning ended up with an awarding winning 457(b) plan.

This website calculator might help you select the appropriate stock bond split and asset allocation for both security and growth: Click here.

Need to discover what is your risk level. Here is a presentation about portfolio risk that should help you decide what level of risk is right for you: https://www.ifa.com/videos/step-11-risk-exposure/