I closed the September 24th 2010 tracking portfolio today. It is a week late , but trust me... that didn't make any difference. As a reminder, I create a tracking portfolio of 50 stocks > $100m every month and hypothetically hold them for a year. I have been doing this since January 2006.
The portfolio lost to the Russell 3000 going down 4.3% vs the benchmark gain of 0.3%. That makes it the nineth straight portfolio to close behind the benchmark. To make matters worse, all 11 open portfolios are also trailing. One can seriously question whether the MFI approach is working. Here is the listing of stocks followed by how all portfolios have fared:
| Stock | Initial Price | End Price | Percent Change | 52 week low | Mkt Cap |
| PRM | 3.41 | 7.10 | 108% | N/A | 157 |
| GXDX | 13.92 | 25.00 | 80% | N/A | 240 |
| TNAV | 5.33 | 8.87 | 66% | 4.80 | 225 |
| IDCC | 28.50 | 46.58 | 63% | 28.90 | 1,232 |
| CNU | 3.97 | 6.38 | 61% | 3.36 | 235 |
| AHCI | 2.45 | 3.84 | 57% | 2.08 | 106 |
| CBST | 23.55 | 35.32 | 50% | 20.81 | 1,381 |
| CNXT | 1.67 | 2.40 | 44% | N/A | 132 |
| LO | 77.18 | 110.70 | 43% | 72.40 | 12,178 |
| MRX | 29.73 | 36.48 | 23% | 24.97 | 1,719 |
| AGX | 8.41 | 10.18 | 21% | 7.98 | 113 |
| VPHM | 15.13 | 18.07 | 19% | 14.28 | 1,079 |
| PDLI | 4.76 | 5.55 | 17% | 4.66 | 616 |
| JCOM | 23.72 | 26.90 | 13% | 24.45 | 1,033 |
| SNDK | 35.85 | 40.36 | 13% | 32.24 | 8,223 |
| SNTS | 2.62 | 2.79 | 6% | 2.40 | 151 |
| HRB | 12.52 | 13.31 | 6% | 10.13 | 3,930 |
| PPD | 64.48 | 66.50 | 3% | N/A | 624 |
| DLX | 18.05 | 18.60 | 3% | 17.50 | 914 |
| MSFT | 24.78 | 24.89 | 0% | 23.65 | 211,759 |
| IMMU | 3.22 | 3.20 | -1% | 2.85 | 241 |
| FRX | 31.35 | 30.79 | -2% | 29.23 | 8,843 |
| UNTD | 5.42 | 5.23 | -4% | 4.80 | 490 |
| USMO | 14.22 | 13.20 | -7% | 12.29 | 343 |
| RTN | 44.36 | 40.87 | -8% | 38.76 | 16,834 |
| IPXL | 19.45 | 17.91 | -8% | 14.46 | 1,204 |
| ASTX | 2.11 | 1.92 | -9% | 1.79 | 126 |
| GTAT | 8.01 | 7.02 | -12% | 6.65 | 1,109 |
| EME | 24.41 | 20.33 | -17% | 20.18 | 1,575 |
| SNTA | 3.91 | 3.25 | -17% | 3.23 | 150 |
| APOL | 50.53 | 39.61 | -22% | 33.75 | 7,493 |
| ZLCS | 1.27 | 0.98 | -23% | 0.92 | 108 |
| TNDM | 12.93 | 9.68 | -25% | 9.02 | 423 |
| ELNK | 8.73 | 6.53 | -25% | 6.52 | 964 |
| PRSC | 15.04 | 10.65 | -29% | 8.35 | 195 |
| LHCG | 24.75 | 17.06 | -31% | 15.76 | 438 |
| KIRK | 13.91 | 9.17 | -34% | 7.69 | 261 |
| TSRA | 18.26 | 11.94 | -35% | 11.83 | 882 |
| CECO | 20.38 | 13.05 | -36% | 12.95 | 1,769 |
| CSGS | 20.65 | 12.64 | -39% | 12.35 | 714 |
| OSK | 26.95 | 15.74 | -42% | 15.65 | 2,368 |
| UIS | 27.88 | 15.69 | -44% | 15.13 | 1,135 |
| AMED | 26.89 | 14.82 | -45% | 12.64 | 788 |
| AFAM | 30.74 | 16.63 | -46% | 15.14 | 280 |
| CRME | 6.10 | 3.29 | -46% | 3.21 | 364 |
| FSYS | 38.70 | 19.21 | -50% | 17.22 | 674 |
| DRWI | 6.90 | 3.30 | -52% | 3.16 | 248 |
| ARO | 23.40 | 10.81 | -54% | 10.09 | 2,156 |
| COCO | 6.30 | 1.55 | -75% | 1.55 | 573 |
| GTIV | 22.80 | 5.52 | -76% | 5.13 | 683 |
| Average of Percent Change | ||
| Date | Total | IWV |
| 1/6/2006 | 16.0% | 10.9% |
| 2/17/2006 | 21.2% | 14.6% |
| 3/29/2006 | 13.0% | 9.6% |
| 4/7/2006 | 10.3% | 12.1% |
| 5/12/2006 | 20.4% | 18.6% |
| 5/31/2006 | 29.2% | 23.3% |
| 6/30/2006 | 22.4% | 20.0% |
| 7/31/2006 | 19.7% | 17.3% |
| 8/31/2006 | 13.0% | 13.3% |
| 9/28/2006 | 12.7% | 14.6% |
| 10/27/2006 | 10.3% | 12.0% |
| 11/29/2006 | -0.3% | 4.8% |
| 12/28/2006 | -6.9% | 3.4% |
| 1/26/2007 | -10.2% | -6.6% |
| 2/27/2007 | -3.7% | -1.0% |
| 3/26/2007 | -9.8% | -5.5% |
| 4/27/2007 | -10.9% | -5.0% |
| 5/29/2007 | -11.5% | -6.3% |
| 7/3/2007 | -30.0% | -15.6% |
| 7/30/2007 | -19.9% | -11.5% |
| 8/30/2007 | -12.5% | -8.7% |
| 9/27/2007 | -19.0% | -18.2% |
| 11/2/2007 | -40.4% | -34.3% |
| 11/28/2007 | -40.1% | -38.3% |
| 12/28/2007 | -36.3% | -40.0% |
| 1/25/2008 | -36.4% | -35.9% |
| 2/26/2008 | -51.7% | -41.5% |
| 3/24/2008 | -40.9% | -36.8% |
| 4/25/2008 | -25.6% | -31.0% |
| 5/28/2008 | -22.2% | -33.6% |
| 7/2/2008 | -11.7% | -25.3% |
| 7/29/2008 | -10.5% | -20.9% |
| 8/29/2008 | -13.8% | -17.9% |
| 9/26/2008 | -4.3% | -10.0% |
| 10/31/2008 | 18.7% | 13.9% |
| 11/26/2008 | 50.9% | 27.7% |
| 12/26/2008 | 48.9% | 32.3% |
| 1/23/2009 | 59.3% | 36.4% |
| 2/27/2009 | 92.8% | 55.6% |
| 3/27/2009 | 85.8% | 48.1% |
| 4/24/2009 | 69.7% | 45.8% |
| 5/29/2009 | 31.8% | 22.8% |
| 6/29/2009 | 21.3% | 24.0% |
| 7/29/2009 | 19.5% | 15.9% |
| 8/28/2009 | 7.4% | 8.8% |
| 9/25/2009 | 12.6% | 12.4% |
| 10/30/2009 | 22.7% | 18.3% |
| 11/27/2009 | 24.3% | 13.6% |
| 12/31/2009 | 23.7% | 18.1% |
| 1/22/2010 | 19.0% | 20.6% |
| 2/26/2010 | 18.6% | 23.6% |
| 3/25/2010 | 10.0% | 15.4% |
| 4/23/2010 | 7.1% | 11.4% |
| 5/28/2010 | 19.3% | 25.4% |
| 6/29/2010 | 16.7% | 25.7% |
| 7/29/2010 | 5.4% | 20.1% |
| 9/2/2010 | 7.3% | 10.1% |
| 9/24/2010 | -4.3% | 0.3% |
| 10/29/2010 | -15.4% | -3.2% |
| 11/26/2010 | -11.3% | -4.3% |
| 1/3/2011 | -18.1% | -10.8% |
| 1/28/2011 | -20.2% | -11.0% |
| 2/25/2011 | -19.6% | -14.3% |
| 3/24/2011 | -20.2% | -13.9% |
| 4/21/2011 | -23.7% | -15.9% |
| 5/27/2011 | -21.5% | -15.8% |
| 6/24/2011 | -19.1% | -11.7% |
| 7/29/2011 | -21.0% | -12.9% |
| 8/26/2011 | -10.0% | -3.9% |
| Grand Total | 2.8% | 2.4% |
| Closed | 7.0% | 4.8% |
| Open | -18.2% | -18.2% |
Special Portfolios
As people may know, I also track two special sub-portfolios. One is called "new" and only has stocks that have not been in a tracking portfolio in the prior 12 months. The second is called "dividend" and only picks stocks with at least a dividend of 2.6% (per Yahoo Finance). The dividend portfolio continues to way out perform (it was up 14% and is beating the Russell in 11 of the open 11 portfolios).
| Stock | Initial Price | End Price | Percent Change |
| DLX | 18.05 | 18.60 | 3% |
| ELNK | 8.73 | 6.53 | -25% |
| HRB | 12.52 | 13.31 | 6% |
| LO | 77.18 | 110.70 | 43% |
| PDLI | 4.76 | 5.55 | 17% |
| PRM | 3.41 | 7.10 | 108% |
| RTN | 44.36 | 40.87 | -8% |
| UNTD | 5.42 | 5.23 | -4% |
| USMO | 14.22 | 13.20 | -7% |
The "new" portfolio has been pretty poor. It was down 18% in the past year and the average open positions are down a poor 21%.
In addition, I do like to track performance solely using percentages. This is because a portfolio that goes up50% one year and down 50% the next leaves you at a worse absolute $ amount than one that goes up 5% and then down 5%. The chart below shows how much money you'd have if you spread $100,000 evenly over the first 12 months:
| Category | Value |
| Total | 98,981 |
| Total New | 93,489 |
| Total Dividend | 197,077 |
| Total Russell 3K | 99,313 |
So while the first table showed that MFI is "beating" the Russell 3000, this table shows we have been losing do to the greater volatility. The standard deviation (a measure of spread) between all the monthly tracking portfolios is about 33%, versus 25% for the Russell 3000.
For those of you playing along at home, here are the dividend stocks in the 9/30/2011 portfolio:
| Stock | Initial Price | Yield |
| USMO | 13.20 | 15.2% |
| STRA | 76.67 | 5.2% |
| PETS | 9.00 | 5.6% |
| PDLI | 5.55 | 8.1% |
| MDP | 22.64 | 4.4% |
| LPS | 13.69 | 2.9% |
| KLAC | 38.28 | 2.9% |
| DLX | 18.60 | 5.4% |
| CMTL | 28.09 | 3.6% |
| CHKE | 12.85 | 7.6% |
| HRB | 13.31 | 4.5% |
| AMAT | 10.36 | 2.9% |
Then here are the new stocks:
| Stock | Initial Price |
| VG | 2.60 |
| DV | 36.96 |
Have a great weekend everyone!
Late Addendum: I saw that MSFT wasn't in the dividend list. That is because their trailing dividend was 64 cents which is a hair under my 2.6% screen. However, they just increased their dividend to 80 cents, so I have over-ridden and added them to list for September 30th 2011.
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