This article is a website version of our weekly FREE Best Ideas Newsletter sent on 17.01.2023. Sign up here to get it in your inbox every Tuesday.
I am sure you will agree 2022 was a tough year!
If you just held onto your capital, you did well.
There were of course assets that performed. For example, commodities were up 22% but the next highest return was cash, I assume US Dollars, of 1.3%. The worst performing asset was real estate investment trusts at -23.6% just slightly worse than China equities which lost 21.8%.
I am not even going to mention Crypto or technology companies.
My performance
My Portfolio lost 5.8%. That's without dividends, which if included it will be about 0% return, I'm very happy with.
I'm also happy with the investments I'm holding. Apart from tobacco, a few ETF’s and energy companies, mainly companies recommended in the newsletter.
Your performance
How did your portfolio perform? Were you happy with this performance?
How do you feel about investing this year?
I would really appreciate your thoughts, feedback, or any suggestions.
Use the Need Help button - at the bottom right of your screen.
What would you like to improve?
What could you have done better last year and where would you like to improve this year?
Also, here I would really appreciate your thoughts – how can I help you to increase your returns or become a better investor?
What I want to do better
This is what I would like to improve on.
I feel like could have invested more last year. Buying more quality undervalued companies. With smaller positions and a tighter stop loss.
In 2022 I had the same thoughts as after the corona crash and the financial crisis. I kept on thinking the market was going to go off a cliff! This let me hold more cash than I wanted to. As you know this is a recurring theme for me whenever there's a sharp correction.
The SMA rule works
That said I'm not too worried because the research study I sent you on the simple moving average rule proved once again that buying if a market is below its simple moving average, 200 days is what we use in the newsletter, is a spectacularly bad idea.
It gives you a LOT higher risk adjusted returns which lets you stick to your investment strategy.
Investing in 2023
I'm sure you're also wondering what 2023 has installed for us.
Just like you, I have absolutely no idea. And remember the experts don't have either, even though they may have some clever sounding theory.
No one knows and that's why you need a good system.
Good investment system
You have perhaps heard me say too many times already a good system consists of a time-tested investment strategy that fits your nature so you can stick with through good and bad years.
You must have clear rules on:
- When you will buy
- When you will sell
- How are you going to stay diversified (country, industry sector, currency)
- How are you going to keep losses low so that you can stick to your investment strategy
Here are two articles that can help you:
How to get started with Quant Investing
How we select ideas for the newsletter – Look at the flow charts at the bottom of the page
Investing is not hard
Investing may sound complex with people throwing around buzz words, but in the end it all comes down to the above few steps.
To be a successful investor you do not have to be super intelligent either.
This was confirmed in an interesting article Your investment portfolio has nothing to do with who you are I read this morning.
It was written by Joachim Klement in a blog I follow called Klement on Investing - Thoughts on financial markets by a grumpy, middle-aged German. What more do you want?
Here is a short quote from the article (bold text is mine):
PS: Because investment success is not a reflection of your personality or IQ, STOP CELEBRATING STAR INVESTORS. Warren Buffet and Cathie Wood are neither smarter nor dumber than other people. It’s just that Warren has found a way to invest that plays to his strengths. Does that mean that copying his investment style is right for you? Of course not. You are not Warren Buffet, so stop looking at what he does.
That is all for this week, this email is already too long.
Your, helping you get the highest returns in 2023 analyst
PS I know markets are still uncertain BUT have you already started building your buy list? If not, why not sign up today and start now.
PPS It is so easy to forget and put things off why don’t you sign up right now?
