October 6, 2013
My goal this year was to have the VIIR portfolio beat the CNX Nifty index by at least 5 percentage points. Based on the chart below, I’m on track to hit my target. The VIIR portfolio is outperforming the Nifty by 6 percentage points year-to-date.
Robert Kirby in a famous 30-year study found that an extra return of 1 percentage point above the S&P 500’s 30-year return would have produced 33% more money than the S&P 500 at the end of the period. Small annual return differences, compounded over long periods of time, will result in significant differences in the amount of money you have at the end of the period. There is a huge payoff from selecting an investment manager or strategy that provides value above the index return over the long run.