Tough Week

We’ve just finished a tough week on the market, so I thought I’d take a look at the test accounts to see if there was protection in any of them. The S&P 500 Index dropped 5.8%, more than double any week since I started this in January. The Folio Investing account dropped 7.0%. This is not unexpected because this account picks individual stocks in RTGs with very high recent performance. High reward equals high risk.

Betterment and Schwab Intelligent Portfolios are designed to spread the risk at the cost of lower rewards. This has proven true in up and down weeks, less extreme swings. And the same was true this week, both dropped, 3.3% for Betterment and 3.7% for Schwab Intelligent Portfolios. These are obviously good choices to dampen the pendulum swings.

Of course, Lending Club has practically no swings. It just moves up every week. Last week’s gain was 0.15%. It moves up at a slow and steady pace. The account is up about 10% this year, even without being fully invested (only about 80%).

If I update the blog again, I’ll post on Twitter at @billlanke.