September | 2023 | SG ThumbTack investor

YTD 2023:

SPY: +18.88%

VT: +14.92%

STI: -0.55%

TTF: +46.40%

SINCE INCEPTION (FEB 2020), ANNUALIZED:

SPY: +11.65%

VT: +8.07%

STI: +0.70%

TTF: +31.61%

Note: Returns are MWRs, all figures in USD

TTF’s NAV: USD 3,359,469.88

Deposits/Withdrawals: USD 1,860,242.06

Nett capital gains since inception: USD 1,499,227.82

For reference, the last fund report:

https://thumbtackinvestor.wordpress.com/2023/06/15/thumbtack-fund-report-17-flavors-of-ceylon/

Since TTF was incorporated in Feb 2020, this means that TTF has enjoyed a nett gain of USD 1,499,227.82 over a period of 42 months of investment activity, which works out to be USD 35,695.90 every month, or approximately SGD 48.2k per month from Feb 2020 to date.

Cumulative ROI (Feb 2020 to Aug 2023):

SPY: +48.31%

VT: +32.00%

STI: +2.52%

TTF: +167.14%

TTF has generated double digit money weighted returns every year since inception:

2020: +89.83% (https://thumbtackinvestor.wordpress.com/2021/01/02/thumbtack-fund-report-6-rose-of-jericho-2020/)

2021: +24.91% (https://thumbtackinvestor.wordpress.com/2022/01/07/thumbtack-fund-report-10-hello-2022/)

2022: +11.94% (https://thumbtackinvestor.wordpress.com/2023/01/02/thumbtack-fund-report-13-hello-2023/)

2023 (YTD): +46.40%

Overall, the TTF’s YTD performance is somewhat similar to the last fund report. Nothing much has changed, it’s kinda flat or perhaps, it has dipped just slightly compared to 2.5mths ago.

Damn, this has been real frustrating.

Since the last report, TTF’s YTD returns have fluctuated within a very narrow band of between +40% to +50%:

There was a brief period where the returns tanked below the band marked by the 2 red lines. This was because of a sudden single day realized loss of $280k USD when 1 of my short positions was acquired and delisted at a premium.

TTF managed to recover very rapidly though, thanks to a few brilliant moves by yours truly, and by the end of the following week, has managed to rise back within that narrow band.

Aside from that, it’s been going up and down and up and down and up and down within this +40% to +50% range for the past 2.5mths since the last report.

Each time as TTF approached the top end of the band, I was sure that we’d see a brand new all time high… only to see it U-turn and go down again.

This is the true definition of financial blue balls.

For the uninitiated who don’t know what’s “blue balls”, pls google “epididymal hypertension“. It’s an actual medical term ok.

What are the symptoms of blue balls?

A feeling of heaviness in the scrotum.
An aching sensation.
Testicular pain or mild discomfort.

What are the symptoms of financial blue balls?

A feeling of heaviness in the ~~scrotum~~ ROI
An aching sensation in the portfolio
Heart pain or mild discomfort.

Dunno how to add in music here, but pls cue in BackStreet Boys’ “Quit Playing Games With My Heart”

After many many many attempts to try to garner more Alpha, and failing to break through that elusive +50% upper band… I spent the last week doing a bit of portfolio forensics: dissecting the entire portfolio with the finesse of an Anatomy professor.

I’ve broken down and looked into each current position, organized them into groups depending on their correlation with each other.

And here’s the interesting thing. Underlying this seeming calm, with the overall portfolio returns within a narrow band, all the individual positions actually exhibited EXTREME volatility. I mean, really extreme. Some of the winners in the past 2.5mths have gone up over 100%, and some losers have, well, gone down 100% aka pretty much written them off.

It’s just that net-net, the winners and losers sorta balance themselves and the overall returns look pretty stable, uneventful, boring even. Yet, in truth, there’s a lot of activity, big moves in either direction. Not boring at all.

Well, what does this mean?

It means that I gotta be real careful here, cos in the absence of just a few winners, the portfolio can go south real quickly. But the reverse is true: if I can identify and cut away the big losers quickly enough, the upside would take care of itself. Hmmm, interesting yea.

I gotta go figure out how to strategize further and break through this +50% barrier.

On the macro side of things, markets are rosy, S&P is climbing gradually, inflation is coming down, latest unemployment numbers are slowly and tamely rising, which ironically is cheered by the markets as it indicates inflation is moderating and the Fed is less likely to go crazy on the rate hike front.

There is no real visible bad news on the horizon.

Which makes me worried.

I don’t think the markets are pricing in the risks of the fastest rate hike in history, the effects of which would only be felt probably in Q4 this year or more likely, in Q1 of 2024. I haven’t even had my mortgage rate changed since the rate hikes begun, and on the property front, haven’t even felt any effect from the rate hike.

Hence, I’ve chosen to be a bit prudent and keep some cash lying around. Most of the positions are in the form of options currently, which allows me to hold a bit more cash: