Here's an update on the portfolio's performance. If you have missed my portfolio review for 2021, please check it out here.
2022 Performance YTD
My Portfolio: -16.06%
Vanguard 500 Index: -12.81%
Performance since inception (Jan 2021)
My Portfolio: -15.23%
Vanguard 500 Index: 12.04%
The US market broke its downtrend. The eight-weeks losing streak was finally broken with a sharp rally in the last week of May. The Fed hiked the interest rates by half a percentage point at the beginning of May. That puts a lot of investors in uncertain waters as many are bracing for a potential economic recession if further economic tightening were to happen.
While many of the investors are already expecting higher inflation and slower growth in the near future, it's still unclear if that has already been priced in the market.
For a moment in May, the S&P 500 has also dipped into the bear market territory with a drop of more than 20% from it's all-time highs. Current conditions are difficult to navigate with huge volatilities. In potential bear markets like this, it's not unusual to see sudden rallies like what we have on the last week of May. The market can also easily change its trend and resume an upward direction to make an all-new high in the near future.
Hence, nothing is assured except for more volatility. So do not be surprised to see your portfolio making big swings on a weekly basis.
In the month of May, I did see my portfolio making significant drops too before paring the losses in the last week of May.
(Source: Portfolio Visualizer)
Negative trends for ARKK and ARKG continue. It is now the seventh consecutive month that they have a negative return. MCHI finally broke the trend with a small positive gain this month. Downtrend for Bitcoin continues with a double digit drop in the month of May. With the current price hovering around $30,000, I'm of personal belief that this is a very good price point to accumulate if you are looking at a time horizon of 5 years and more.
I won't be expecting my portfolio to be making significant gains in the near future as most of the constituents in my portfolio are facing strong headwinds currently. On a longer term horizon, I'm still confident that it will begin to outperform the market and provide a double digit CAGR which I'm targeting.
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