Vest Investor Report
The Vest Investor Report is a new content initiative to show you how your fellow investors are performing and, in particular, to learn from the strategies of top investors. We’re building a socially-powered portfolio builder that aims to empower customers to consistently beat market benchmarks–regardless of their experience level–while rewarding the best investors with proven track records to earn extra income.
We’ll provide more details about this initiative in the coming days.
Still, for now, the important thing to know is that a “top investor” is someone with a combination of:
High all-time returns.
A consistent win ratio compared with market benchmarks.
Low downside volatility.
Like what you see here? We are also producing detailed, personalized portfolio reports. To access yours, please email us at support@mivest.io, and we will get your personalized report!
Without further ado, let’s get into the flagship Vest Investor Report, June 25th, 2024!
This chart shows the performance of Vest investors since January, 2023, grouped according to their Vest Investor Rank. The top 10% of investors are in “Decile 10,” while the lowest performers are in “Decile 1.”
On the one hand, as of June 14, the top 10% investors at Vest had a return of 110% beating the market (45% return) by 65% over almost 18 months. On the other hand, the bottom 10% have lost 8% over the same period, losing to the market by 53%.
Over this time, 30% of our users have beat the market, while 70% have underperformed its returns. This number is interesting, as beating the market is quite complicated and only a handful of professional investors can consistently achieve this. It remains to be seen whether this strong performance from Vest investors is cyclical, or whether we have a cohort of investors who can sustain this strong momentum through a potential future downcycle.
There are several interesting things about the portfolio of Vest’s top investors. For one, the Magnificent Seven ($Meta, $Microsoft, $Nvidia, $Amazon, $Apple, $Google, $Tesla, $Netflix) represent 42% of the portfolio, with Meta and Nvidia–winners of the AI boom–representing 25% of the total portfolio.
Other relevant positions include market-tracking ETFs such as $VOO, $QQQ, $TQQQ, $VNQ, $SPY and $IVV.
Remember that many of these stocks have already posted very large gains: there may be further room for growth but this report is not meant as investment advice and we do not advocate that you go out and copy this portfolio. In the next Vest Investor Report, we’ll provide you with more details about what positions top investors are trading today.
Cash represents a significant portion of the assets, with ~5% of the concentration, as assets continue to go up, some investors have decided to increase their cash position. For the past 18 months, cash for the top 10% of investors has oscillated between 3.7-4.9% of the total portfolio, with several fluctuations. An interesting trend is that starting in April, the cash concentration has begun to increase and continues to do so, reaching levels not seen since the beginning of 2023.
Often we ask the question: Is now a good time to buy?
This question feels particularly relevant today, with the PE (price/earnings) ratio currently at 36, a level that was only higher prior to the stock market crashes of 2000 and 2022. In simplified terms, a PE ratio of 36 means that if you bought 100% of this company, it would take 36 years for you to earn your money back at the company’s current price and profit level.
For most of us, our best strategy is to buy market indexes on a regular basis as we save money, saving ourselves the worry of whether we’re getting in at the right time or not.
To learn more about this, check out team Vest's recent analysis regarding market timing.
Today, the five largest market tracking ETFs based on total assets under management (AUM) are $SPY, $IVV, $VOO, $VTI, and $QQQ. High AUM indicates a high level of market adoption, while these ETFs also tend to have relatively high average daily trading volumes, making them liquid. $SPLG is an example of ETFs that also track market indices but that manages much less AUM.
That said, Warren Buffet famously said to :
Be fearful when others are greedy, and greedy when others are fearful.
And based on current cash concentrations, we do see some evidence that top investors are becoming more cautious. This is not investing advice. It is market intelligence from the investing community you belong to, designed to support you as you execute your investing plan.
How can we improve this report for you? What questions do you have for us, or what other data points would you like to see? We are also producing detailed, personalized portfolio reports. To access yours, please email us at support@mivest.io, and we will get your personalized report!
Until next week, Team Vest
https://etfdb.com/compare/market-cap/ https://etfdb.com/index/nasdaq-100-index/ *For illustrative purposes only. Does not represent an investment recommendation. For more information, please see our Social Media Disclosure.