QAV Light Weekly Update #73

Hel­lo QAV Light Brigade

It’s Mon­day and this is my week­ly report. Wel­come to all of our new sub­scribers! 

The AORD rebound­ed again last week and the AFR is pre­dict­ing a good start to this week as well.

Light Port­fo­lio Group Results 

As a group, our port­fo­lios are down 2.34% CAGR pa while the bench­mark is up 12.45%.

While some of it is due to a few of our stocks under­per­form­ing, I think a chunk of the dif­fer­en­tial can be put down to two major con­tribut­ing fac­tors:

1. The fact we were sit­ting on a lot of cash over the last 18 months, while we could­n’t find any­thing to invest in for long peri­ods. The STW does­n’t have that prob­lem so it’s not real­ly an apples-for-apples com­par­i­son of per­for­mance of the stocks them­selves (although going to cash in peri­od of tur­bu­lence is, of course, part of the QAV strat­e­gy). 

2. The chop­pi­ness of the last 18 months has result­ed in us hav­ing to use our Rule 1 trig­ger quite often, what Tony has referred to as the “Rule 1 Death Spi­ral”. As he’s men­tioned on the show recent­ly, he’s doing some analy­sis to see if there’s a bet­ter cut off line for Rule 1. How­ev­er, as QAV Club mem­ber Cos­min point­ed out to us recent­ly (as men­tioned on a recent episode), it exists for a very good rea­son (he believes his per­for­mance would be twice as good if he’d fol­lowed Rule 1 reli­gious­ly). 

We’re con­fi­dent that the sys­tem is fine, because, as you can see below, the QAV Dum­my port­fo­lio had a rea­son­able year, as did many of our QAV Club mem­bers who have been report­ing sim­i­lar results on our Face­book group this morn­ing. We all under­per­formed the index in FY23, but we’re all sig­nif­i­cant­ly out­per­form­ing the bench­mark over the last few years. It has a lot to do with how estab­lished the port­fo­lios were before the mar­ket start­ed get­ting shaky in ear­ly 2022, due to Ukraine and inter­est rate ris­es, etc. The more estab­lished they were, the less Rule 1’s they had to do, and the smoother the per­for­mance has been. 

Any­way, if you’ve been lis­ten­ing to the pod­cast recent­ly, you’ll also know that Tony isn’t at all wor­ried about being down 10 — 15%. We can make that up in no time when the mar­ket turns back in our favour. It’s all about “time in the mar­ket”. Over the long haul, it all bal­ances out. 

22.1

221 is down 15% CAGR pa. Our first Light port­fo­lio unfor­tu­nate­ly got off to a bad start, launch­ing in Feb 2022. Bad tim­ing! As we can see below, the STW has bare­ly moved over that peri­od of time, too.

22.2

This port­fo­lio closed 08/08/2022 and has done quite well. It’s up 20.21% CAGR pa vs the STW up 7.17%.

22.3

This port­fo­lio is also lag­ging the STW. It’s down 6.89% CAGR pa vs the STW which is up 6.71%.

23.1

Our last port­fo­lio only closed last month, even though we launched it in Decem­ber 2022. It took us that long to ful­ly invest the ini­tial cap­i­tal, which is crazy and a tes­ta­ment to how dodgy the mar­ket has been late­ly. This one is down 0.66% vs the STW which us down 2.17%.

BUYS

DISCLOSURE

In the inter­est of full dis­clo­sure, we would like to advise that, as of the date of this email, the QAV team cur­rent­ly hold these stocks in their per­son­al port­fo­lios:

AFG CCP FHE FPR FMG GNC IGL JHG MQG PLS QAN QBE RMS SGM VEA WAM

Please note that our per­son­al hold­ings might not include the stocks we rec­om­mend in QAV Light. This is because we already have full port­fo­lios (15–20 stocks) and can only add new stocks if we have to sell some­thing.

If you’re inter­est­ed in learn­ing more, please review our trad­ing and dis­clo­sure pol­i­cy.

FOR NEW MEMBERS

If you’re new to QAV Light, here’s a quick reminder on how it works.

1. We send you an email every Mon­day advis­ing which stocks we are adding to our Light port­fo­lio.
2. You can copy our trades, but please remem­ber to review our Trad­ing Guide­lines to under­stand which cap you should be look­ing at and oth­er impor­tant con­sid­er­a­tions. And con­sult a finan­cial plan­ner before mak­ing any deci­sions.
3. We don’t rec­om­mend that you add stocks which are already in our port­fo­lio. Their posi­tion on our buy list might have changed since we rec­om­mend­ed them. Just start with the stocks rec­om­mend­ed after you become a mem­ber.
4. If one of the stocks we add breach­es one of our sell con­di­tions, we will sell it from our port­fo­lio and you’ll get an email advis­ing of the trade. Again, you can copy our trades, but seek finan­cial advice before mak­ing any deci­sions. And please check your Rule #1 price (see Trad­ing Guide­lines).

That’s it for today!

If we decide to buy or sell some­thing, we’ll let you know.