The portfolio lost 1.7% for the month of May, bringing the year-to-date return to 4.0%. That's a bit worse than the S&P's -1.35% return for the month.
* We report the percentage gain or loss during a month in an additive sense for ease of comparison, however the year-to-date returns are reported as a chained series. As the total return become greater, and as inflows have an effect on the portfolio, the two will diverge. Adding up the monthly returns for the year may not give the precise total return.
30 Jun 2011
Small-C April 2011 Letter
The portfolio gained 1.9% for the month of April, bringing the year-to-date return to 5.7%.
Since we bought Berkshire Hathaway this month, we've been reading "The Essays of Warren Buffett" on our morning tube ride. For the most part, it's entertaining and occasionally thought-provoking, rarely earthshattering. However, one simple yet profound piece of wisdom made a serious mark on us, and we're not sure if we'll ever be able to fully assimilate its implications: an investor should be cheered when equity (or any asset) prices fall, because he or she expects to make more investments in the future and will be getting a better price. It left us feeling foolish and confused - we had all the information yet got the crucial conclusion wrong our entire lives, feeling glad about rising asset prices. We're (hopefully) not even halfway through our investing life, and hope that our current investments represent only a small proportion of our eventual wealth, yet somehow we've felt glad each time rising prices made that more difficult. Viewed even more simply, we hope to die in a larger, better house than the one we live in today, yet our gut reaction is to feel relief whenever London house prices rise.
* We report the percentage gain or loss during a month in an additive sense for ease of comparison, however the year-to-date returns are reported as a chained series. As the total return become greater, and as inflows have an effect on the portfolio, the two will diverge. Adding up the monthly returns for the year may not give the precise total return.
Since we bought Berkshire Hathaway this month, we've been reading "The Essays of Warren Buffett" on our morning tube ride. For the most part, it's entertaining and occasionally thought-provoking, rarely earthshattering. However, one simple yet profound piece of wisdom made a serious mark on us, and we're not sure if we'll ever be able to fully assimilate its implications: an investor should be cheered when equity (or any asset) prices fall, because he or she expects to make more investments in the future and will be getting a better price. It left us feeling foolish and confused - we had all the information yet got the crucial conclusion wrong our entire lives, feeling glad about rising asset prices. We're (hopefully) not even halfway through our investing life, and hope that our current investments represent only a small proportion of our eventual wealth, yet somehow we've felt glad each time rising prices made that more difficult. Viewed even more simply, we hope to die in a larger, better house than the one we live in today, yet our gut reaction is to feel relief whenever London house prices rise.
* We report the percentage gain or loss during a month in an additive sense for ease of comparison, however the year-to-date returns are reported as a chained series. As the total return become greater, and as inflows have an effect on the portfolio, the two will diverge. Adding up the monthly returns for the year may not give the precise total return.
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