Where I Invest

Where I Invest

My investment capital is distributed between a portfolio of Peer to Peer Lenders, and a Growth Portfolio of stocks, bonds, REIT’s (Real Estate Investment Trusts) and gold. The investments are low maintenance, low to medium risk, with very reasonable risk/return ratios. Investments require at maximum 1-2 hours per month to maintain once they are set up.

 

Peer to Peer Lending Portfolio

Returns on the Peer to Peer Portfolio  are between 4% and 15% (current actual returns are available here), with lower to medium risk Peer to Peer investments. I use Peer to Peer Lending because returns on investments are far superior to the returns I can get from banks or current government bond coupon yields.

My strategy with Peer to Peer Lending is a “lazy investor” strategy where I am looking for the best returns for the least amount of work. Most of my accounts are “auto-invest” accounts where once the capital is lent out it’s really just a case of checking it every few weeks to make sure everything is going as it should.

 

Read more about my Peer to Peer Portfolio and returns.

 

Growth Portfolio

The Growth Portfolio is time tested over more than 20 years of actual investment.  It is backtested through similar asset-class backtesting for almost 50 years. It has produced an annual average return of almost 10% CAGR (Compound Annual Growth Rate), with an average drawdown of around 9% and a maximum drawdown of 14.75% in the 2008 financial crisis. Again, I like the “lazy investor” aspect of this portfolio which just needs rebalancing one time per year after the initial investment.

 

Current Asset Distribution Chart

 

For more detail on how the Growth Portfolio is constructed click here.

Below is a comparison of how my Personal Growth Portfolio compares to other popular portfolios over the last few years. As you can see, the % returns and drawdowns are better than the original Harry Browne Permanent Portfolio.

Portfolio 1 is my current Personal Portfolio Allocation.

Portfolio 2 is the original Harry Browne’s Permanent Portfolio mix. Cash has been left out, as I think that skews it to the downside unfairly.

Portfolio 3 is made up of a 50/50 mix of Stocks & Bonds using ETF’s. 

The S&P ETF is there as a representation of the US Stock Market Baseline.

 

Growth Portfolio Comparison 1

Growth Portfolio Comparison 2

Growth Portfolio Comparison 3

 

BALANCES shown are just there to show growth as an example. They are not actual portfolio values.

Click here to see a live, current version of this backtest.

 

If you would like to see longer term asset class backtests, see my Backtesting page.

 

 

Here is a link to the actual Growth Portfolio Returns.

logo