Did you know that everyone has their own model?
ou call it your investment strategy or plan. Stars has 4 fixed rules and requires one hour per year to manage. Do you even have fixed rules or criteria? How much time do you spend on your personal finances?
Many investors have financial advisors that suggest their models or plans for you based on your needs. The problem is that their performance is typically 5% below the S&P. The Stars model earns twice the S&P.
Over the past 25 years the average portfolio only doubled in value. You think yours was much greater but that was because of your constant additions. If you invested in the S&P you would have 17 times your initial amount. The Stars model made based on backtesting 117 times the initial investment. Stars made 60 times the typical portfolio and 17 times the S&P.
Most investors are obsessed with minimizing drawdown like that causes a loss. It is only a loss if you sell. On corrections you should be upgrading your portfolio. In a major correction everything except cash and bonds have a correction that can be as much as 40 – 60%. These rarely happen. The only way to avoid drawdown produces very poor performance.
In 25 years corrections will look like dips because of the enormous long term gains. Stars has 8 versions and 6 variations to meet your particular needs. If you sold your worst 10% holdings and invested it in TQQQ your portfolio performance would be increased by 8 percentage points per year.
It is your investment strategy and only you are responsible for its performance.