Good morning to all copiers, followers, and those lucky few that are seeing this, thanks to my cunning and yet effective use of tags. This is the first yearly report from the @Macchia69 portfolio. The followers will know I do a version of this every month, and in that, I show the granular view of how the portfolio is performing. This report runs from 18/2/23 to 17/2/24 for historical reasons: having started trading on eToro on 17/2/20. However, from the next iteration of the report, it will be aligned to the calendar year.
So, let’s look back at this year, and while we do so, to give you a bit of insight on how things go and why I do the stuff I do.
I managed to clock a nice 42.88% unrealised growth, which is not the 50% I initially, ignorant of the effect of the PI restrictions, thought. However, it’s a growth that beats even the buoyant markets of 2023. While there is a difference between the unrealised (mine) and realised (eToro) percentages, it is the expected result of not factoring in, on eToro’s side, the policy of not selling at a loss that I keep.
On this front, it is also noteworthy the trade stats which certify that 99.68% of the 5,353 trades I made were closed at a profit, small maybe, but profit nonetheless.
Risk management wise, getting onto the Popular Investor program forced me to stay within Max Risk 7, and as you can see, not only did I manage to do so with some margin, but the average risk has been a lot lower than even I expected at 3.58.
2023 also saw the introduction of the dividend, a feature of the portfolio that unfortunately has now been put on hold due to the introduction of the copy trading rebalancing function by eToro. Let’s just say that the change has pros and cons, but for sure the bigger drawback, from this portfolio point of view, is to make it virtually impossible to offer the flexibility that the dividend distribution was offering. In the eight months I ran it, on average, 3.65% went out each month.
Another noteworthy consideration is the one on the impact that fees, i.e. overnight and weekend charges, have on the profitability of the portfolio. For ease of calculation, I segment earnings into two categories: direct profit from trades, and fees. Within the fees category fall not only the overnight and weekend charges, mainly levied due to the fact that I trade the UK100 at x10 leverage, but also the dividends that I receive from the assets in the portfolio. Being that those are both passive comings and goings of cash, I lump them together. But if you’re curious, it looks like the incoming flow (dividends) reduces the outgoing flow (charges) by approximately 27% (charges: -$19,468, dividends: $5,386). Anyways, to cut a long story short, fees eat out 24.45% of the gross profits, taking a theoretical 56.03% to the 42.88% we enjoyed. This is, however, the price of doing business, as it would be impossible to realise the returns I do without the use of leverage, and, leverage being a loan, has a cost.
Finally, a consideration on the Popular Investor side of things. I have had various opportunities to remark on how humbling it is to see the faith that the copiers are putting in me as a manager of their savings. The growth is quite remarkable, and, as seen from both the chart and the numbers, I might not be able to rest on the laurels of my CISI Level 3 exam for long before I get on the CISI Level 4 books. The two things that mostly strike me are the higher than average investment per copier, as I already find myself in the top 30(ish) of copy traders by AUM while only in the top 60(ish) by copiers, and the fact that there are a high number of my copiers that make me their only investment. While I’m pleased about the first one, I am a bit concerned about the second one. Don’t get me wrong; my ego is well-massaged by it, but I worry that these copiers, distracted by the higher than average rate of return of the portfolio, forget that this portfolio is relatively higher risk. What I’m saying is: “Don’t forget that financial success relies also on risk management through diversification.”
To conclude, a rather good year with 50 out of 52 weeks in the green, and let’s move on to an even better one.”
- Year Average Risk: 3.58,
- Year Max Risk: 5.42,
- Year performance
- eToro (realized): 53.21%,
- my data (unrealised): 42.88%
- Initial Value: $88,051
- End Value: $102,934
- My dividends (money withdrawals): $29,168
- Total change: $44,051
- Profitable months:
- [eToro stats]: 9 (75%)
- [my stats]: 12 (100%)
- Weeks [my stats]:
- Profitable weeks 50 (96.15%)
- Current streak: 50
- Best week 5.24% [13/03/2023],
- Worst week -0.73% [27/02/2023],
- Average week +0.83%
- Trades analysis:
- Total trades: 5353
- $UK100 5336 (99.68%)
- Other 17 (0.32%) [$AMZN, $GOOG, $MSFT, $SPY, $VTI, etc…]
- Profitable trades 5332 (99.6%) [non profitable 21]
- Total profit from trades: $57,585
- Dividends/Fees: -$14,082 (24.45%)
- Net profit: $43,503
- Total trades: 5353
- Popular Investor status
- Initial: Cadet
- Final: Elite
- Copiers number
- Initial: 66
- Final: 884 (+1,339%)
- AUM
- Initial: $73,520
- Final: $3,090,000 (+4,202%)