10/4/08

ETF Portfolio Underweighting US October Update

It has been another tough month. The ETF portfolio trails the S&P 500 by 13 basis points as of October 3, 2008. The S&P is down 12.89% since mid August, while the ETF portfolio is down 13.02%. As last month, the US dollar's strength is one of the main reasons for the underperformance of the portfolio. Not only has this resulted in greater losses in the ETF portfolio's foreign stock holdings, foreign bonds have also become depressed, and the dividends they pay out were much smaller this month.

Except for US debt (BND), all of the ETF portfolio's holdings are in negative territory. BND's return is a measly 0.98%.

We're at an interesting and frightening juncture. With the passage of the bailout, there is the possibility of inflation or even hyperinflation. Provided foreign currencies remain steady, this will bode well for the portfolio (not so much for us in real life, though). At the same time, some are concerned that what awaits us is deflation. If this comes about (probably even worse for us in real life), the portfolio will continue to shrink.

All portfolio updates can be found here. The chart at the right is updated once a month. A spreadsheet view of the portfolio's holdings is available here.

Here are this month's updates:


Dividends received and reinvested:

BWX $0.133 * 17.23 = $2.29159 [52.08] .044 more shares

IPE $0.325 * 14.878 = $4.83535 [49.39] .0979 more shares

WIP $0.196 * 13.5938 = $2.66438 [50.50] .05276 more shares

VTI $0.296 * 24.026 = $7.11 [54.82] .129728 more shares

RWO $0.464 * 19.036 = $8.8327 [36.91] .2393 more shares



Fresh $500 invested:

VTI $112.25 total 2.0476 shares at 54.82 avg purchase price = 1667.98/26.0736 shares = $63.971986

VEU $120.21 total 3.0279 shares at 39.7 1732.66/36.18 = $47.88999

VWO $158.19 total 5.07 shares at 31.2 1486.48/36.832 = $40.358

BND $0 total .085 shares at 76.46 506.4/6.73 = $75.25

BWX $0 total .48 shares at 52.40 925.2/17.23 = $53.70

RWO $54.66 total 1.48 shares at 36.91 883.23/20.756199 = $42.486584

RJI $91.56 total 9.7925 shares at 9.35 1171.92/102.4215 = $11.44

IGF $29.42 total .8607 shares at 34.18 559.44/14.0087 = $39.935

IPE $0 total 0 shares at 50.72

WIP $29.08 total .57584 shares at 50.50 820.37/14.2224 = $57.681

FRN $9.73 total .5547 shares at 17.54 117.73/5.4597 = $21.5634

Cash -$106.25


Dividend received and reinvested:

SPY $0.691 * 81.7973 = $56.52 [110.34] .51225244 more shares

Fresh $500

SPY $500 total 4.53 shares at 110.34 11000/86.839 = $126.67 cost basis per share