My Investment Performance

Alright I manged to dig up some data for my investment results in 2007. I should caution I’m only going to focus on my RRSP and RESP accounts today. I don’t have the same data as easily available for the taxable accounts.

So here is the breakdown:

My RRSP made 5.12% in 2007
My Wife’s RRSP made 6.51% in 2007
The RESP made 2.96% in 2007

So if my goal is to make 8% a year I’m in trouble. Yet there is a bit of a hope still. As I also have our longer term annualized return.

From Jan 1, 2003 till Dec 31, 2007 my RRSP had an annualized return of 11.86% while my wife’s RRSP made 10.01% over that same time frame. The RESP has only been around from Sept 2005 and it has made 7.34%.

Overall the long term numbers I’m happy with but this year so far are dragging those good results down. How bad? Well as of our March 31, 2008 statement our long term averages were down to 8.73% for my RRSP and 7.55% for my wife’s RRSP (and I can’t find the latest RESP statement).

Yet I still need something to compare this against.  So here we go.  The global couch potato by Moneysense is very similar to mine.  So it’s performance should make a decent benchmark.  Over the last five years it’s annualized rate of return was 8.8% ending on Dec 31, 2007.  So overall I can’t complain.  I’m not getting stunning results, but I’m keeping up nicely.

So how did you do in 2007?

7 thoughts on “My Investment Performance”

  1. Hey, I’ve just discovered your blog. I might have written a comment in the past that I had very similar goals as you. Mine is retire by 41 (it was retire in 10 yrs when I made the goal at 31). I have under 8 years left.

    According to the BMO website my portfolio has averaged these returns over the the last 5 yrs.

    1 Year 32.93% (2007)
    2 Years 15.72%
    3 Years 12.33%
    4 Years 12.07%
    5 Years 16.17%

    My own calculations based on the account balances, since I started getting aggressive in 2006 are:

    2007 (vs Dec 31 2006): 19%
    Q1 2008 (vs Dec 31 2007): 41%
    Month of April (vs Mar 31 2007): 7%

    I’m at least quadrupling the TSX index.

    I burned a lot of time and money playing, but I think I got into a bit of a groove in late 2006 and have been actively working a medium sized play portfolio. Since 2006 I turned 69K into 147K with 22K of contributions in there during that time.

    I was like you before, just buying BS mutual funds from the bank. But then I grew to hate the bank because they didn’t deliver anything.

    I’m far ahead of my plan to retire in 8 years. I need about 15% per year increase in net worth but I’m slaying that (I say I’m, it’s my wife and I). I may be able to half the retirement date. In fact, it might be better for me to retire now; I can see the chance this year to make more from my non-job sources than from my job.

  2. Our overall return for 2007 was 4.1%. That was for an 80% equity/ 20% bond split.

    What is your asset allocation? Do you have 100% equities? If not then having a 8% expected return is a bit aggressive in my opinion.


  3. Mike,

    My RRSP would be 75% equities and 25% bonds last year, while my wife’s RRSP and the RESP would have been 100% equities.

    My target rate of return is 8% overall, but my calculations allow for a buffer of 1%. So as long as I’m breaking 7% I will still be on target.

    I’m aware I’m agressive for a target, but keep in mind I’m getting an average pre-tax income return of about 14% in the taxable accounts.


  4. Is your 8% after inflation? Are you guys levered? 14% is good, 8% is not ok, less that about that and you’re treading water.

    Do you have tax strategies beyond maxing the RRSP?

    Why wouldn’t you try for more than 8%. 10% is a round number, why not try for that? It only helps.

    Diversification is to limit the risk, but it limits the return. If you can handle the risk, which it seems like you can, why wouldn’t you reach higher to retire earlier?

  5. Tim have you discussed your asset allocation or actual holdings before, I don’t recall reading it and couldn’t find anything in a quick search.

    For 2007 my personal combined returns for taxable, rrsp & resp were 4.7%. I’ve been holding a lot of cash, which is why it stunk.

    My corporation’s investments returned 7.6% but half of that was in USD (which tanked) so the return was actually -1%

    After reading Customers Revenge’s returns I felt the greedy bug bite me and wish I could get returns like that. Then I realized if I tried going after that lofty goal I’d probably lose more then he’s made. Congrats to you on the great fortune or skill.

    For me, I’m antsy to go with at least a 50% indexed portfolio this year but I have the feeling that the market as a whole will do poorly and continuing to hold cash would be better… am I worrying too much? or being stupid for trying to “time” a switch over?

  6. Jordan,

    I have discussed asset allocation before, but just briefly a few times. Holdings again have been mentioned here and there, but not in one big post.

    Investing entirely depends on the person. Customers Revenge(CR)’s returns tell me he spends lots of time looking after his investments. As such he can expect better returns than more passive approaches. It’s really a matter of how much time do you want to spend on your investments. If you treat it like a part time job then you can go for an active plan which requires more time, but can generate better results.

    Me, I’m lazy and like to do other things. So I tend to do just a little active investing in my taxable accounts just for some excitement and to keep learning. The majority of the money is going to be indexed as such I expect lower returns than CR.

    As to your plan. It really is up to you. I personally don’t mind all this volatility as it does present some good buy in points. Yet I don’t worry too much about trying to time the market. In the end, you have to decide what works for you and stick with it.


    I’m in the process of over hauling my plans for investing so if you have any comments feel free to share. Keep in mind I want a portfolio I can set and forget about for months at a time.

    I agree that higher returns means you can retire earlier. Yet at the same time I’m not willing to pick up another part time job just working on my investments. So if I beat my target great, otherwise I keep at my 8% and I can easily retire at my 45th birthday.


Comments are closed.