I wasn’t sad to see 2015 end. It was called “the year that nothing worked.” And while that’s not entirely true – if you happened to be long the “FANG” stocks Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Google (GOOG), you did quite well – it was certainly true for my Dividend Growth portfolio. The strategy had a poor second half to the year, erasing the gains of the first half and leaving it with a loss of 11.3% for the full year net of fees.

And the volatility didn’t end on December 31; it spilled over into January. As I’m writing this letter, the maximum drawdown from the April 2015 highs to the mid-January lows was a gut wrenching 27.6%.

That might be tolerable if I were running an aggressive growth portfolio full of speculative names. But I distinctly built my Dividend Growth model with low volatility in mind. The portfolio entered the year with a beta of 80%. In layman’s terms, that means that the Dividend Growth portfolio was about 20% less volatile than the broader market. And with an R-squared that generally stays in the 60s or 70s, the portfolio’s correlation to the broader market has historically been low. This is a portfolio designed to march to the beat of its own drum, regardless of the direction of the market.

So, what happened? And more importantly, what is the outlook for 2016?

I’ll address each of those questions. The short answer is that we got bogged down in a credit crunch and that the portfolio should enjoy a nice recovery once credit conditions return to “normal.” Now let’s get into the details.

What Went Right in 2015

Let’s take a moment to review the Dividend Growth portfolio’s mandate. Its primary objective is to provide a high and growing stream of income. And on this count, the portfolio delivered. The portfolio started 2015 with a trailing dividend yield of 4.8%, more than double the dividend yield of the S&P 500. And we achieved very respectable dividend growth: Total cash received from dividends in 2015 was up 8.7% over 2014.

We had two stocks – Kinder Morgan (KMI) and Teekay (TK) – take us by surprise with dividend cuts. But portfolio wide, the theme was one of growing dividend payouts.

I’m willing to stomach quite a bit of market volatility if I’m confident that the stocks I own will continue to deliver a reliable dividend stream to my investors. Providing income in retirement or dividend compounding at younger ages are my primary objectives, after all. But it’s hard to enjoy that income when you see the value of your portfolio grinding lower every day.