It’s been about a month since I’ve
reported on the test accounts. I did add cash to the remaining accounts and
have been tracking them weekly for my own purposes. Because the cash hit at
different times, tracking percentage changes became more complex. But since they
all have had identical amounts invested, simply looking at the totals becomes
the best ballpark measure of performance.
So I thought I’d document some of my current observations.
Currently, Folio Investing has the
highest balance, hence the best performance of the three market related
accounts. I added one more Ready to Go portfolio (this one contains large
companies based in Japan). This gave me 5 RTG portfolios and one based on my
allocations. In the last three weeks this account has grown 0.98% (compared to
0.12% for the S&P 500 index). All but one of the six portfolios have grown
in the past three weeks. The Biotechnology RTG is the clear winner accounting
for two-thirds of the account growth.
Betterment has grown 0.30% in the
past three weeks. Part of the reason its increase was smaller than Folio
Investing was that the additional cash was credited to Betterment faster than
the others and it grew more in the first partial week than the other accounts,
leading to smaller growth in the subsequent three weeks.
Schwab Intelligent Portfolios has
had the worst performance, dropping 0.18% over the last three weeks. That’s
particularly disappointing since they had been achieving the best overall
performance before the funds were added. They did re-balance the fund with the
additional money, but there has been no other re-balancing since the account
was opened. This is contrasted to Betterment who attempt to re-balance with
every dividend received, no matter how small. Mine and other studies have
indicated the frequent re-balancing isn’t particularly useful, but who knows.
Lending Club has grown 0.9% over
the last three weeks. Its growth is slow but steady. I have not had any bad
debts yet, but about 1% of my notes are late and could be headed toward
default. So far this account has an earnings rate of about 15% per year. If the
late notes I have go bad the annual return would fall to about 9%. This account
is an IRA filtered through a custodian (SDIRA). I’ve been trying to add funds
via a transfer from Fidelity for a month. Finally, this week, I had Fidelity
stop the initial check and wire the funds. SDIRA has had the transfer for a
couple of days and hasn’t transferred the funds to Lending Club yet. Once
there, it will be at least a month before the first earnings can be achieved
from notes purchased with the new funds. And it will take a long time to
convert the new funds to notes. I guess patience will be a virtue here.
I don’t plan on updating this blog
regularly, but will post on Twitter when I do, @billlanke.
