My Income Portfolio: In The Garden Of Eden

2025-05-05 13:27:24 ET

Summary

• Total Return can be misleading if not supported by NAV growth, as it may include unsustainable distributions and Return of Capital.
• Behavioral finance shows markets are irrational, making it crucial to consider practical aspects beyond theoretical Total Return calculations.
• I believe that NAV performance can affect our discretion in the reinvestment choices for the distributions we receive from our savings much more than Total Return.
• In this article, I will analyze the behavior of the securities in my portfolio over the five-year period of 2020-2024 from the perspective of both Total Return and NAV performance.

At the end of March, I flew to the US for a splendid trip to the Colorado Plateau, from Delicate Arch to the pinnacles of Bryce, from the buttes of Monument Valley to the velvets of Antelope Canyon. In the meantime, all sorts of things have happened in the markets, coming within a hair’s breadth of the Apocalypse. A short and violent storm, but today we can resume sailing in somewhat calmer water. I decided to start navigating again by talking about Total Return. In my way, as always.

A Fantasy World

King Ludwig II of Bavaria built Neuschwanstein Castle in the second half of the 19th century in southern Germany, near the Austrian border. It is the quintessential fairy-tale kingdom, built in the style of Germany’s ancient feudal residences. Inspired by distant Teutonic legends, together with the nearby castles of Linderhof and Hohenschwangau, it represents in the collective imagination the idea of a fairy-tale, idealized Middle Ages, whose veneration has come intact from the Romantic era to the present day thanks to the musical genius of Richard Wagner....

Read the full article on Seeking Alpha

For further details see: