Performance

Unaudited Portfolio Returns (Summaries)
After Hypothetical 0.375% Quarterly Management Fee
July 2000 – December 2022
Benchmarked to S&P 500

2000-2022 Results

• Test Portfolio Performance Statements for July 2000 through December 2022 may be viewed here.
• Brokerage statements for July 2000 through December 2022 may be viewed here.

Beginning in July 2000, when he became a full-time investor, the bulk of Bill Matson’s securities portfolio was designated as a “Test Portfolio” (TP), in order to track the efficacy of those principles detailed in the Data Driven Investing book he co-authored.

The TP’s unaudited results have been encouraging, with gross returns of 9998.6% between July 2000 and December 2022. On a compounded annual basis, returns for this period were 22.8%. Average annual returns were 29.2%.

Those who might contemplate an investment strategy based on the principles of Data Driven Investing should keep in mind that such strategies may underperform market indices by significant margins for extended periods. Moreover, past performance does not guarantee future performance; there can be no assurance that the next 22 1/2 years will mirror the past 22 1/2.

Return Calculation Methodology:

The TP’s performance history includes all taxable brokerage accounts that:

1. maintained balances exceeding $100,000 for at least one complete calendar month between July 2000 and December 2022, and
2. were 100%-owned and fully controlled by Bill.

During months when Bill had two such accounts, as was the case between 2004 and 2007, we have consolidated their statement data.

Our performance calculations assume that all deposits are made at the beginning of the month and all withdrawals are made at the end of the month. As a result, positive monthly returns tend to be slightly understated and negative monthly returns tend to be slightly worse than presented. Overall returns, however, are significantly understated due to the preponderance of positive monthly returns. (In the case of October 2022 – when Bill sold his house – a 10/28 deposit of over $200,000 lowered that month’s gross returns from approximately 10% to 6.9%.)

These calculations assume reinvestment of all dividends and zero taxes.

The Data Driven Investing book indicated 2003 returns of 157.0%. Due to rounding, this figure differs from the 157.1% figure shown elsewhere on this site.

The period documented in the Data Driven Investing book was an unusually profitable time for small cap value investing. Returns since that time have been significantly lower, for small cap value stocks, as well as for this portfolio.

Due to its option purchases and sales, margin borrowing, and significant positions in small cap, often illiquid stocks, this portfolio’s strategies entail a high degree of risk and may not be appropriate or suitable for some investors.

Neither Bill nor any organization with which he is affiliated are currently offering products that are likely to duplicate this portfolio’s returns. Consequently, its past performance should not be relied upon in any way as being indicative of future returns that ORF’s clients are likely to achieve.

Past performance does not guarantee future performance.

Sources of brokerage statements are Fidelity, TD Ameritrade (TDA), and a large St. Louis-based firm where Bill had an account from January 2012 through mid-2013 which has requested that we not refer to it by name.

Fidelity, TD Ameritrade, and that large St. Louis-based firm are not responsible for the subject matter of this site and have not reviewed its content for accuracy. They have not examined, nor do they endorse, any trading strategy discussed on this site. The Fidelity Investments and Pyramid Logo is a registered trademark of FMR Corp.

BENCHMARK

Since the S&P 500 members all have multi-billion dollar market caps, it may not be the ideal benchmark for the TP’s strategy, which involved many sub-$100 million market cap stocks. It was selected because it is widely used and includes a representative sample of leading companies in leading industries. The TP securities were significantly more volatile and risky than their S&P 500 counterparts.

Note: Past performance does not guarantee future performance. Note also that ORF does not provide personalized investment advice.