Twenty-Three Years in One Chart
My investing journey, Part 1
Sep 28, 2026 · @Deniz Erkan
In 2003, I was an ambitious young engineer at Microsoft in Seattle, focused on my career and learning from some of the best people in my industry. Investing was my side project. I opened a Fidelity account and bought what looked interesting, without yet knowing what kind of investor I was.
Over time I studied the investors I admired most, Peter Lynch, Warren Buffett and Charlie Munger, and grew into the idea of a circle of competence: knowing exactly where your knowledge begins and ends, well enough to know whether it gives you an advantage. Most of what I learned afterward came from living by that idea, and some of it from ignoring it.
Twenty-three years later, that account and the ones that followed have compounded at close to 20% a year. That is a good record, and I am proud of it. But the number is the least interesting part.
What interests me now is the anatomy underneath it: which companies created the wealth, which destroyed it, and how much of my conviction was actually mine. When I went through the records company by company, three kinds of decisions stood out. The ones where I knew something. The ones where I borrowed someone else's certainty. And the ones where I simply got it wrong.
The record, and what it cost
Reconstructed time-weighted returns from monthly account balances; S&P 500 price index (FRED, Yahoo Finance)
A dollar invested in February 2003 became about $73 by September 2026. The same dollar in the S&P 500 became about $9, before dividends. That is 19.9% a year against 9.7%.
The chart is also honest about how long it took. By the end of 2019, after seventeen years, my dollar had become $2.53 while the index's had become $3.78. I was behind. Then the builder's edge came together, and the line changed shape.
Year | My return | S&P 500 |
|---|---|---|
2003 (from Feb) | +22.3% | +29.9% |
2004 | +9.6% | +9.0% |
2005 | +13.8% | +3.0% |
2006 | +15.1% | +13.6% |
2007 | +17.5% | +3.5% |
2008 | −28.3% | −38.5% |
2009 | +33.1% | +23.5% |
2010 | +5.1% | +12.8% |
2011 | −4.3% | 0.0% |
2012 | +14.4% | +13.4% |
2013 | +5.1% | +29.6% |
2014 | +0.5% | +11.4% |
2015 | +0.2% | −0.7% |
2016 | +0.1% | +9.5% |
2017 | +18.7% | +19.4% |
2018 | −23.5% | −6.2% |
2019 | +16.0% | +28.9% |
2020 | +858.3% | +16.3% |
2021 | +17.1% | +26.9% |
2022 | −46.7% | −19.4% |
2023 | +66.5% | +24.2% |
2024 | +66.0% | +23.3% |
2025 | +31.2% | +16.4% |
2026 (to Sep 24) | +33.1% | +12.5% |
Annualized | +19.9% | +9.7% |
Growth of $1 | $73.02 | $9.00 |
It was not a straight line, and it did not beat the market every year. I beat the S&P 500 in 13 of 24 years and trailed it in 11. From 2013 through 2016, my accounts barely moved while the market kept climbing, because I was barely in the market: my first company was failing, and my savings had gone into it. In 2018, I lost 23% while the index fell 6%.
The two years I remember most are opposites. In 2008 I lost 28%, painful but ten points better than the S&P 500. In 2022 I lost 47% while the index fell 19%. The chart above shows where each year ended. Look at the monthly numbers and you will see something the annual view smooths over: once, my accounts fell 60% from their peak. That is easier said than done. Peter Lynch said the most important organ in investing is the stomach, not the brain. I understood that long before I lived it. Living through it gave me emotional resilience, and it showed me the boundaries of my own capacity as an investor: a circle of competence for the stomach, not just the mind.
In between came 2020, the year leverage on my convictions changed the shape of the whole record.
Three eras, and the letters ahead
Looking back, my investing life falls into three eras.
- 2003 to 2012: before I had a style. An experiment run alongside my career, beating the market without knowing why, and the slow education that followed.
- 2013 to 2016: the flat years. My first venture-backed company went down, my savings with it, and I was barely in the market while Raed and I built our second company.
- 2017 to today: the builder's edge. I came back with a style I could explain, invested in what building technology products had taught me, and used measured leverage from 2018.
The next seven letters take these apart one at a time:
- Part 2, The Decade Before I Had a Style: experimenting, 2008 and finding my teachers.
- Part 3, The Flat Years: the hardest period of my life, and starting again.
- Part 4, The Builder's Edge: the ten years since 2017, and how building products picked my winners.
- Part 5, My Own Dot-Com Bust: the companies that fell 80% and more, and what they taught me about position sizing.
- Part 6, The Year of Levered Conviction: what really happened in 2020, and what my record looks like without it.
- Part 7, Borrowed Conviction: the ideas that were never really mine.
- Part 8, A Letter to My Younger Self: the nine lessons I would hand the young engineer who started in 2003.
The chart shows where I ended up. The next seven letters are the journey that got me there.
Engineered compounding,
Deniz Erkan
Disclosure: This letter describes my personal investment history across all of my personal accounts combined: the accounts where I invested entirely on my own judgment, and, from 2020, the account where early versions of Runtime ran alongside my own positions. Returns are reconstructed estimates from monthly account balances, are not audited, and do not include the effect of fees or taxes on any other investor. The long-run record covers February 2003 through September 24, 2026; the company figures cover August 2016 through August 2026 and group all positions by company. Index comparisons use S&P 500 price returns, excluding dividends. This history is separate from the Runtime fund and its algorithmic strategy, whose positions are proprietary. Past performance does not predict future results. This is not investment advice.
Sources
- S&P 500 index levels: FRED SP500 and Yahoo Finance