Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!

In this Discussion

Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.

    Support MFO

  • Donate through PayPal

Are You Checking The Portfolio too often?

edited March 2019 in Off-Topic
Warren Buffett doesn't have a computer on his desk. He buys stocks for the long run and he doesn't let short term stock prices impact his investing decisions. He advises investors "Don't watch the market closely" highlighting that when investors are "trying to buy and sell stocks, and worry when they go down a little bit - and think they should maybe sell them when they go up - they're not going to have very good results.

To me this all depends on the psychology of each individual and what they’re checking. Are you checking your annual return every day? Comparing how gold performed compared to equities on a major news day? Looking to see how correlated your portfolio is with the S&P or some other reference point? Wondering how domestic funds performed relative to internationals?

Some believe: Curiousity kills the cat. Others, like myself, discern no harm in being curious. I’m aware that study after study finds rough correlation between frequency of checking portfolios and poorer returns. But did the looking cause the poorer return? Just as likely I think - Investors with a tendency to trade more frequently also display a tendency to monitor performance more often.

http://mastersinvest.com/newblog/2017/5/11/check-daily

Comments

  • MJG
    edited March 2019
    Hi Guys,

    The referenced article makes a strong case that indeed “curiosity kills the cat”. Many investing wizards are quoted in the article that support that position. In this instance, I am with these experts. The market up days only slightly exceed the down days. Keeping our fear of losing emotion under control is a difficult challenge, and checking often works up that negative emotion.

    "You know, I think people’s investment would be more intelligent, you know, if stocks were quoted about once a year." That’s from Warren Buffett.

    I actually check my portfolio several times a year so I violate Buffett’s observation just a little bit.

    Best Wishes


  • Question = Are You Checking The Portfolio too often?

    Answer = No

    Variable = Know thy self
  • Totally agree. I can remember "back in the day" when most mutual fund investing was done one account at a time with each individual fund company. This will come as a shock to those of you younger than 40, but this was before Schwab, Fidelity, Vanguard and other firms established online accounts for buying and selling mutual funds. Brokerage houses had their consolidated statements, but most of them used their own firms' in-house mutual funds (unfortunately many still do that). Fund shareholders received individual statements for each of their mutual funds. So you might get two from Vanguard, one from Janus, three from Fidelity, etc. And the statements only came when activity occurred, such as dividends, buying, and/or selling. So some accounts issued statements only once a year, as they were required. Few daily prices were listed, and those only in print newspapers. This is all to say that checking the values even once a month of all one's mutual funds took time...there was no online ANYTHING back then. People did not check their accounts much at all. I'm not nostalgic about those times, for sure. But I really only check my portfolio values when I get my Schwab statements, and even then not necessarily when they arrive in the mail. I could check accounts online every day, but why? Perhaps two or three times a year I will evaluate individual holdings in my accounts, but that is about it. I suggest that everyone ask themselves "Am I an investor or a trader?"
  • MJG
    edited March 2019
    Hi Guys,

    In my earlier post I made a generic observation that equity market up days exceeded down day frequency. That’s merely a general comment that is not satisfactory. Here is a Link to specific data:

    https://www.crestmontresearch.com/docs/Stock-Yo-Yo.pdf

    The data are relatively constant over numerous timeframes. These data did surprise me. BobC asked a most important question: Are you an investor or a trader? Thank you BobC.

    Best Wishes
  • edited March 2019
    MJG said:

    Hi Guys, In my earlier post ...

    Hi MJG,

    Thanks for contributing to this thread. The only problem I had with your earlier post is that it appeared to distort @Crash’s intent in posting from what he wanted to discuss to what you wanted to discuss instead. Indeed, I suggested than that you or someone else start a separate thread on the topic you really seemed to care more about,

    While I accept that you did not intend to critique / criticize @Crash or others who responded to his query, I, at least, took it that way. This board has a wide purview in terms of what fund topics posters may discuss. While you or I may choose not to participate in some threads, I think it’s important we not appear to be goring somebody else’s ox or passing judgement on their investing acumen. Obviously the question Crash posed pertained to mutual funds and was deemed important by him or he would not have proffered it.

    I’m sorry if my response the other day was unnecessarily rude.

    Regards, hank
  • Not an investor but I obsessively check the markets intraday and the impact it may have on my mutual fund positions. I am a big believer in the compound effect. The consistent compounding of my capital over time. For me the Compound Effect is the power of small adjustments be it daily, weekly, or monthly that leads to success. Of course popular lore by the close minded says you can’t beat the market over time. So I guess the more than secure retirement I am now enjoying was built on imaginary profits.
  • Hi @Junkster
    With you on this..........and as I noted prior.....know thy self, eh?
  • I check the Markets often. I have the leisure time. Medicare starts this year, too. Do I throw a party and double-down? Or panic and sell everything on a bad day? Of course not. I have my own stop-limits. Nothing like simply staying INFORMED.
  • I'm with Crash on this. I check 3 or 4 times each week in order to stay informed. If and when I have the time I check daily. I did my research on my investments before investing. My investments are based on fundamentals, not on momentum or noise or "stories". Why would I want to not add to a position in a mutual fund when its NAV is down? How would I know it is down unless I have information? Seeing the value of my investments go up and down daily, weekly, monthly, creates very little emotional response in me; no elation, no panic. I just wanna know what's happening. And it's fun! I'm investing to assure the security of my family. It's a serious thing, but still it is fun.
  • A question for @Junkster, please. If you have mutual fund positions how can you simultaneously be "not an investor" ? My best guess is that you are not currently adding to positions. Or did you mean something else?. Just curious. Thanks!
  • edited March 2019
    Ben said:

    A question for @Junkster, please. If you have mutual fund positions how can you simultaneously be "not an investor" ? My best guess is that you are not currently adding to positions. Or did you mean something else?. Just curious. Thanks!

    @Ben - Just a guess. But @Junkster may be implying that he’s a “trader” (active) rather than an “investor” (passive). Regardless of what he calls it, it I know him to be damn good at what he does.
  • Every single day I can, oftener when trading (not often)
  • Every single day I can, oftener when trading (not often)

    image

  • Are You Checking The Portfolio too often?

    Yes. There is nothing else to do. If there was we wouldn't talk about it all the time.
  • edited March 2019
    I look just to see how my holdings performed in aggregate (percentage up / down) against a conservative benchmark (TRRIX) I’ve long used. Knowing I’m positioned somewhere in that sweet zone beats taking sleeping pills, buying an annuity or moving everything to cash.

    What I will often look at, however, are not my own holdings, but rather a tracking list of funds I don’t own: I feel it helps me stay in tune with the markets and to compare fund performance against the verbiage we hear from these managers or investment houses.

    HSGFX - Because of an infamous manager (Hussman)
    DSENX - Because of a well known manager / market prognistacor (Gundlatch)
    KCMTX - Because its manager sometimes posts here.
    OAKBX - Because I sold it within the past year.
    VFINX - Because it closely tracks the S&P
    PRHYX - Because it provides a glimpse into high yield bond performance
    PRGMX - Because it reflects the government backed (high credit) bond market performance.
    TRBCX - Because it represents one of the better high-octane funds from TRP. Shows how a lesser risk averse investor might have done.
  • edited March 2019
    I never knew of a business owner that stayed in business long unless they gave attention to detail and kept their shop open for business. Therefore, I treat my investing endeavors as a bussiness; and, with this, I check my portfolio daily after market close. In addition, I do portfolio investment analysis and research work along with maintaing certain records, that I keep, throughout the week. I did not become an accredited investor because of my in action.

    Some might think that I'm being a micro manager ... but, it has worked well for me, thus far, through my close to sixty some years of investing. With this, I have no plans to change.

    So ... author writing person ... write all the articles you wish on the subject and reference as many as you like to support your view along with, while your at it, don't forget to collect your writing fees.

    Again, I have no plans to change.

  • edited March 2019
    Old_Skeet said:

    ... while your at it, don't forget to collect your writing fees.

    Ol’Skeet reminded me that a substantial number (dare I say most?) of what may appear to be independent studies on the topic have been compiled and disseminated by institutions engaged in marketing investment products. Hopefully the source I linked in the beginning is an independent source. I attempted to do so.

    In light of the great many reports out there from firms with a vested financial interest in retaining clients (not having them panic and leave in down markets), it’s worth taking a good look at all the studies being used to bolster the idea that not knowing how your investments are doing is somehow better for you than knowing.
  • edited March 2019
    Hi @hank. There are a lot of perspectives and thoughts on this subject. I'll bet most small business people know their daily sales activity. So, why should an investor not know their daily activity? Just a thought to ponder. For me, investing is a business because I have to pay taxes on my investment profit. When the average investor sells out in a down trending market there are those, with stronger hands, that are buying. I generally, like to buy in down markets and sell some of when I beleive things are overbought. I don't just govern by a feeling, or wim, but I use my stock market barometer to re enforce my feelings or belief.

    Again, those that sell out in a down market just might not have the right asset allocation mix to stick with it. And, their risk tolerance might not be what they thought it was as it was set for goal achievement and not to their true level of risk. Expectations often times are just not realistic.
  • Old_Skeet said:

    I never knew of a business owner that stayed in business long unless they gave attention to detail and kept their shop open for business. Therefore, I treat my investing endeavors as a bussiness; and, with this, I check my portfolio daily after market close. In addition, I do portfolio investment analysis and research work along with maintaing certain records, that I keep, throughout the week. I did not become an accredited investor because of my in action.

    Some might think that I'm being a micro manager ... but, it has worked well for me, thus far, through my close to sixty some years of investing. With this, I have no plans to change.

    So ... author writing person ... write all the articles you wish on the subject and reference as many as you like to support your view along with, while your at it, don't forget to collect your writing fees.

    Again, I have no plans to change.

    Why does becoming an accredited investor have any relevance? Accredited Investor and Qualified Purchaser are simply based on investable assets, not any level of sophistication.....
  • Or income-based, but again it is by no means indicative of any investment expertise.
  • @JoJo26: From my perspective you never really answered my question I asked on you in an earlier engagement as your answer(s) seemed only to partially address my question.

    Old_Skeet said:
    Hi @JoJo26: Now that I steped forward and responded to your question(s) ... How about you steping forward and detiling your expenses associated with your portfolio and positions held along with telling us how you invest. I'll make this an open ended question so feel free to respond accordingly. I'll be interested in hearing how your new school way compares to the old school way.

    Although you commented on some of the active funds you hold and their expenses you never commented on the other funds you indicated you held. Therefore, based upon the scope of the question presented and your incomplete response ... I now have you on ignore.



  • edited March 2019
    Another article where the title does not represent the content in the article. The content is all about making indiscriminate short-view trades can harm your returns. It implies, I guess, looking at your portfolio every day could cause that to happen. Hard to argue against the premise making investment decisions based on day to day volatility can be hazardous to your money.

    I'm basically in line with it's premise on not reacting to day to day volatility. But like most people here responded, I enjoy keeping abreast on my portfolio movement, because as someone else mentioned, it is fun and it does give a feeling of understanding (whether that feeling is accurate or not).
  • Old_Skeet said:

    @JoJo26: From my perspective you never really answered my question I asked on you in an earlier engagement as your answer(s) seemed only to partially address my question.

    Old_Skeet said:
    Hi @JoJo26: Now that I steped forward and responded to your question(s) ... How about you steping forward and detiling your expenses associated with your portfolio and positions held along with telling us how you invest. I'll make this an open ended question so feel free to respond accordingly. I'll be interested in hearing how your new school way compares to the old school way.

    Although you commented on some of the active funds you hold and their expenses you never commented on the other funds you indicated you held. Therefore, based upon the scope of the question presented and your incomplete response ... I now have you on ignore.



    If you have me on ignore, why are you responding?
  • A few random thoughts:

    For @BobC - I used to know someone who, back in the day, would wander into his broker's office to read the stock ticker, or so he later claimed.
    image

    When I was going to school a couple of decades ago, on my way home I'd use a payphone (remember them?) by the train tracks to call my broker's 800 number for end of day account balances. Just something to do to kill time while waiting.

    In Silicon Valley, everyone knows that the market opens at 6:30AM and they are busy checking their company stock minute by minute. Doesn't seem to affect their productivity or their portfolios.

    I agree with @MikeM's perspective. To put it another way, like technology, information is neutral. It depends on what you do with it.
  • edited April 2019
    @hank: I know from reading your above comment that you follow KCMTX.

    Did you know that last week being opening week in baseball that Parker Binion's fund knocked it out of the park last week (so to speak)? KCMTX was up 3.2% for the rolling week through Monday.

    You might want to check as to how the portfolio was last reported to be positioned at Morningstar (10/31/18). Interesting? Yes ... long stocks. Overweight in health care, technology and consumer cyclical.

    I got my single for the week ... and, he hit a tripple. They must have been leveraged?

    Wonder where he has it currently positioned? Any thoughts?

    The below link will take you to the fund's home page at Kerns Capital Management. Then click on the fund's fact sheet (12/31/18). It will be interesting to see what is reflected in the fact sheet as of 3/31/19 when updated.

    https://kernscapital.com/service/kcm-macro-trends-fund/

    Morningstar reports it's turnover ratio at 534%. So, it is pretty active with its positioning in response to the forever chaning market currents.

    A question ... "please" ... for the Genie. Where do I go next?

    Answer ... Just buy the fund and get on board.

    Skeet
  • edited April 2019
    Old_Skeet said:

    @hank: “I know from reading your above comment that you follow KCMTX. Did you know that last week ... Parker Binion's fund knocked it out of the park (so to speak)? KCMTX was up 3.2% for the rolling week through Monday. Wonder where he has it currently positioned? Any thoughts?”

    Hi @Old_Skeet - Just so others know ... @PBKCM, one of that fund’s managers, occasionally posts at MFO. Shows as last active in December - though I’d imagine he still follows the board.

    Other than monitoring the performance of KCMTX on a watch-list of a dozen different types of funds, I have no particular insight into this one. I find it helpful to systematically compare my own defensively positioned portfolio’s performance against a few different types of funds. I’m intent on mitigating volatility while still outdistancing cash and bond type investments. For longer-term investors short-term volatility isn’t important; but if you’re deep into retirement and taking distributions from the pot regularly, than short-term volatility may be (or at least may seem to be) important to you.

    Here’s their 2018 Report: http://kernscapital.com/wp-content/uploads/2018/08/KCM-Annual-4.30.2018-Final-1.pdf


    - The report details the fund’s holdings and discusses its objectives, style and philosophy. Lacking, IMHO, is any substantive insights into: which sectors they currently favor, major buys / sells during the past year, or what they deem attractive / unattractive investments at the current time. Compared to other reports I’ve read, some managers say a lot less (PRPFX for example) and some others, like OAKBX or DODBX, say quite a lot more about what they’ve been doing tactically and where they intend to take the fund.

    - If you’re looking for where leverage (or overweighting) might have worked last week it would be in the interest rate-sensitive areas, as rates fell sharply. This would include utilities, real estate and longer dated investment grade bonds. The fund had around 24% in utilities, according to their December 2018 report. And they held about 7% in basic materials and energy. The latter two have also been strong in recent weeks.

    - Practically speaking, to an outsider these types of funds are all but impossible to understand when you try to look at the moving pieces. (They rightfully benchmark their fund against a hedge fund index.) I’d be a bit suspect about that “0%” short position M* lists. Doesn’t sound right based on the manager’s own description of how he invests - even allowing for December being a bad month. Looking over the 2018 Report I’m not able to tell what they hold short positions on.

    - I’d never recommend a fund like this for those with long-term investment horizons. If you are in the later life capital preservation stage and are concerned about the macro view, than a small slice of one might help to dampen potential losses in uncertain markets. Like you, Ol’Skeet, I rejiggered my approach last year to account for advancing age. I began with a 15% allocation to alternatives (excluding gold), but quickly determined that to be too high and pulled it back to just 10%. All of that is in T. Rowe’s new TMSRX. I should note that TMSRX has much more modest aspirations than KCMTX. Price considers this hedge-like fund to be primarily an income-focused fund. I’d think RPSIX would be a good one to compare TMSRX with over time..

    Happy investing.
Sign In or Register to comment.