Shawn Burns is Solve the Riddle

  REVIEW OF PERFORMANCE fy2024 The numbers are in for 2024. The portfolio generated 20.8% (after costs and some cash taxes [1] ), the benchmark return was 13.4%. I am satisfied with the result, considering all things. What are all things? Was I in the fortunate receipt of much good luck (or bad luck), or did I utilise much higher risk in a rising market? Did style assist me? Does the result differ from what could be considered a random outcome (that is the hardest to assess)? I will attempt to address some of these in the following text. The following post will be divided into several sections addressing various segments. To reiterate my investment philosophy is to buy quality companies when they are reasonably priced. Of course, this sets a conscious boundary on likely results, up and down. I am consciously setting a limit on risk by skewing the portfolio almost totally to quality growth companies with a long history of profitable businesses. The belief is that over the long...

  CHANGING THE BENCHMARK FOR 2025 Each year I review the benchmark I use to assess my performance. A full discussion is in an earlier post. The changes made are to use 400 equally weighted (EW) stocks down from 600. Broadly these comprise 60% profitable Australian companies, 30% high-quality international growers and 10% of the best speculative stocks IMO. Reducing numbers allows for more finessing of the quality factor, which is most relevant in the 60% segment of profitable Australian companies. That is, as we move to a EW benchmark we automatically reduce factors, against the market-weighted index, such as success and size. That is a conscious choice on my part, but we do not want to reduce quality. In the customised B/m, each stock weight is 0.25% negating individual stock impacts. Regarding sector bias, Australia is overweight resources so care has been made to limit exposure to resource stocks and, to a lesser degree, those stocks largely dependent on activity in th...