I am trying to see any correlation between my Singapore equity portfolio against the Straits Times Index (STI).
The table shows portfolio gain or loss in percentage term measured between current value against cost and STI on that particular date. It has 10 months of data starting November last year to August of 2013.
|Date||Portfolio Gain/Loss (%)||STI|
|30 Nov 2012||– 4.57%||3069.95|
|19 Dec 2012||– 5.21||3158.57|
|30 Jan 2013||– 1.34||3285.90|
|5 Mar 2013||– 2.33||3248.26|
|28 Mar 2013||– 2.50||3308.10|
|30 Apr 2013||– 4.08||3368.18|
|23 May 2013||– 4.41||3393.17|
|24 Jun 2013||-10.83||3074.31|
|26 Jul 2013||– 6.75||3236.10|
|23 Aug 2013||– 11.55||3088.85|
I started with loss (– 4.57%) at end November when the index was 3,069.95. The loss started to narrow from 30 January (- 1.34%) when STI rose to 3,285.90. Loss remained low from 5 March to 23 May when STI was between 3,250 and 3,393 points.
The STI peaked on 22 May 2013 (at 3454.37) and went down from then on because Ben Benanke, Chairman of Federal Reserve Board (Fed), told Congress about the possibility of scaling back the monthly US$85 billion bond purchase starting central bank’s next few meetings. The intention to tighten monetary policy caused flight to safety and reduction in liquidity in the global financial markets.
My portfolio lost 10.83% on 24 June when the index was 3,074.31. In July, the STI picked up to 3,236.10 and my portfolio pared the loss to – 6.75%. But a month later, 23 August, my equity portfolio lost 11.55% when the index was 3,088.85.
In some sense, my Singapore equity portfolio went down whenever the STI was down. Conversely, it was somewhat true too.
Note that this is rough and ready gauge of performance of portfolio. I did not take into account those stocks bought or sold during each period (though not material in relation to portfolio size). New stocks and sold stocks are factors to consider for accurate reflection of correlation. In fact, dividend is the other factor to consider too.
Copyright © 2013, limkimtong for Living Investment
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