“Never depend on a single income, make an investment to create a second source.” Warren Buffett
Huygens is receiving special attention for two reasons. 1. I’m in the process of moving from a Relative Strength to an Income Generator portfolio and the account is not fully populated. This review is an update of the process. 2. The Huygens was one of the poorest performers so this transition is an effort to improve the return/risk ratio. It will take many months before we know if this income investing model is adding alpha to the portfolio.
Since this is not a full review, I’ll skip the Tranche and Manual Risk Adjustment worksheets as they are not critical to the Huygens. The Huygens is a Buy-Hold-Rebalance portfolio.
The following data runs from 11/30/2020 through mid-morning of 10/20/2021 or getting close to one year. It will take time to see how well this income portfolio performs when compared to other management models. Of special interest with be the comparison with the Schrodinger. Over the last year the Huygens has performed quite well compared to any of the benchmarks. This performance was not always so.
As with the IRR data, the following Risk Ratio data is based on a launch date of 11/30/2020. Several factors are impacting the Jensen and Treynor curves. First, the beta of the current portfolio is much lower than it has been as we are now working with Closed End Funds where the volatility is lower, thus lowering the overall beta of the portfolio. Second, the change in management style is resulting in better performance. The goal is to continue this performance improvement.