It seemed a timely reminder yesterday when I posted my most recent update, that with the forecast yield being at 3.68%, it struck a little chord that that is close to what I think of as the long running average for the FTSE100.
And, this is despite my starting with a higher yield, over 4%, and actively looking to buy above average yield investments.
In much the same way as the FTSE, some have outperformed, other less so, and in doing so settled into a similar long running pattern of averages.
I guess portfolio's do follow a similar path of hope and promise, but with the intent to hold long term, much of that early stage, widespread promise of opportunity and growth, peters out to a steadier (hoped for anyway), year on year growth more akin to the average.
That would go some way to understanding the performance over the last year or so.
And whilst my portfolio is only 19 holdings, the top 3 holdings comprise 50.72% of the whole.
For the FTSE 100, the top 9 comprises 48.78%, and the top 10 comprises 51.63%.
So I am marginally to the safer side of that, 10 companies being 10% of the FTSE100 (when there are 100), and my 3/19 being 15% of my holdings (just 2 companies would have been on a par).
I am also finding that 20 companies is probably my limit in terms of keeping a watchful eye on them all, as even at this level, I do sometimes lose track of how some are performing, and of course any under-performance is lost in the average.
So a different way of thinking about my portfolio, and one to be aware of. It was always the expectation but the hoped for outcome is a continuing year on year gain at an acceptable risk adjusted level.
Its also a little reminder about goals (How to make a Million (by the time you are 65)!), and the ongoing risk of portfolio imbalances as reader comments have pointed out for me.
And whilst, performance wise, I am on plan, I'm not sure if I have a firm hand on either the goal or the risk yet.
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