Sunday, July 01, 2012

Moominvalley June 2012 Report

Accounts for June in US Dollars:

These accounts aren't totally final due to the slow reporting of tax credits etc. at the end of the Australian financial year which was on Saturday. Net worth rebounded strongly (by $33k) from May in USD terms as the Australian Dollar rose over parity again. Net worth is now $US617k or $A602k. We spent $US5754 but some of that was work related and without that we spent $5,319. $1,000 of that was a coffee machine that was supposed to be a present for Snork Maiden's dad. Or maybe not. He told us to use it ourselves so that we can teach him. Seems to require some skill still in the milk department despite being an "automatic" espresso machine.

The rate of return in USD terms was 3.96% vs. 4.99% for the MSCI World Index and 4.12% for the S&P 500. In Australian Dollar terms, though, we lost 1.37% (-0.46% in currency neutral terms).

Lost Decade Update

Back in September last year I discussed the idea that the last decade was a lost decade as far as investment returns were concerned. Back then the MSCI World Index was outperforming the S&P 500 with almost twice the rate of return over the last ten years. And I had been outperforming both indices over that timespan. Now, 10 months on, the picture has changed a lot thanks to the ongoing European crisis and the underperformance of the Australian market:

The S&P 500 has caught up a lot and now has a 4.42% rate of return over the last decade, which at least beats inflation. This partly reflects, however, that June 2002 was in the depths of the "tech crash". The MSCI is now on 5.2% up from 4.15% last September. And I am at 4.54%, down from 4.61%.

Half Year Report

These accounts are for the first six months of this year in Australian Dollars:

As they even out the month to month volatility they are perhaps a bit easier to get the big picture from. The first two numbers on the top row are after tax salary etc. and retirement contributions. After that we have non-retirement investment income which netted out to $174. Snork Maiden said: "At least it is positive!". Retirement accounts did a lot better on investment income. We spent $33k which means we saved $54k from the non-retirement stream while retirement accounts rose $26k. The savings rate from regular income is then 62% with roughly 70% of spending on "needs" and 30% on "wants". We can save around $100k per year at the moment ($9k per month) which is much more than enough for the increased housing expenditures that would come with the kinds of houses we are looking at (about $4k higher a month).