V2 Model 2022 Annual and Historic Performance

2022 Recap

Happy New Year!

This is the completion of our 7th year and our 3rd year anniversary for our V2 Investment Newsletter. Happy Anniversary!

Below you will find our numbers, comparisons, and a few thoughts.

We just finished what is perhaps one of the toughest investing years in more than a century. Combined, stocks and bonds had their poorest performance since 1871. V2 also had its poorest year on record but beat the SP500 by over 10%.

2022 has been a painful year for stocks. All three of the major averages suffered their worst year since 2008 and snapped a three-year win streak. The Dow fared the best of the indexes in 2022, down about 8.8%. The S&P 500 sank 19.4%, and is more than 20% below its record high, while the tech-heavy Nasdaq tumbled 33.1%.

Sticky inflation and aggressive rate hikes from the Federal Reserve battered growth and technology stocks and weighed on investor sentiment throughout the year. Geopolitical concerns and volatile economic data also kept markets on edge.

We had two missions when we first started V2. They remain the same today. First, beat the SP500. We figured if we could do that over the long term we would be happy. Second, to make money. That goes without saying. This year we split in that regard.

V2 Performance (Total Return%)

1 year. -9.88%

3 year. +207.93%

5 year. +475.16%

Since Inception. +1300.86%

SPY 3-year total return. +24.37%

V2 was 8.5X better than SPY over the last 3 years!

2022 Benchmarks

SPY (SP500) -18.17%

QQQ -32.58%

TLT (20-year treasuries) -31.24%

AGG (Aggregate Bonds) -13.02%

AOK (Conservative Allocation ETF) -14.16%

APPLE -26.32%

ARKK (Cathie Woods) -66.97%

BRK/B (Warren Buffet) +3.31%

AMAZON (Bezos) -49.62%

TESLA (Musk) -65.03%

NETFLIX -51.05%

HEDGE FUNDS -6.5%

According to investment data firm Preqin, hedge fund returns have fallen 6.5% this year, their biggest since a 13% decline in 2008. (Data through Nov. 2022)

V2 finished 2022 by beating the SP500 by 10.7%.

2022 V2 ranked in the top 1/3. #939 out of 3015 possible ETFs and ETNS. The 69th percentile.

2022 Monthly Performance. V2 had a very poor January as we were leveraged long to start the year and were hurt in the downturn. V2 improved until taking losses in October and November then closed the year up a bit. We ended the year in the top 1/3 vs all ETFs.

One key takeaway - V2 for the last 11 months of the year was up 1.12%. The SP500 was down in the same time period by 13.58%. Our V2 ratios and math did what it was supposed to do and protected us in a downturn.

V2 3-Year Total Returns. +207.93%  

V2 Ranked #1 vs all (3015) ETFs and ETNS for 2020-2022. GRN was second at 197%.

Comparative data from ETFDB (ETF Database Screener) on Jan. 1, 2023.

V2 5-Year Total Returns. +475.16%

V2 Ranked #1 vs all (3015) ETFs and ETNs for 2018-2022. TAN was second at 193%.

Comparative data from ETFDB (ETF Database Screener) on Jan. 1, 2023.

Notes/Plan

I am disappointed we did not do better in 2022. Losing money sucks. That said, we did better than most. I am, however, thrilled with our performance over the current 3-year, and 5-year periods and, since our inception.

I am excited about 2023 and I am more convinced than ever that our strategy and our math are positioned to succeed. I have spent the last several months dissecting our math, charts, and execution. We have added a few new ratios to our mix. We have spent more time working on relative strength indicators. And we have continued to test an assortment of different timing and market divergences. We are hopeful a few small changes can continue to improve our results.

One thing we learned is that our performance would have been better had we not been as conservative and used more leverage during the year. We will consider that going forward.

Investing can be a humbling business. Thank each of you for being a part of V2.

Follow the math.

Chris

Market information from LPL Financial, ETRADE, Morningstar, ETFDB, and StockCharts.com.

Copyright 2022. The Vig Company LLC Monona, WI 53716 [email protected]