November 25th 2011 Monthly Tracking Portfolio

November 25th 2011 Tracking Portfolio

 Looks like a cold late fall weekend in Connecticut as I sit here sipping my coffee. I have a pumpkin pie in the oven, and some soft Christmas music on the cd player.

As my faithful readers know, I have been tracking the Magic Formula Stocks as described by Joel Greenblatt in The Little Book That Beats the Stock Market since January 2006.  Every month I take the top 50 stocks over $100m market cap from his website and track how that portfolio of stocks fares versus the Ruseell 3000 for the next 12 months.  It has been an uphill struggle as the tracking portfolios have under-performed, driven in part by Chinese reverse merger fiascos, for-profit education stocks and home health care stocks all being proverbial albatrosses.

This month-end was sadly no different, going up a solid 13.9%, but still getting thrashed by the R3K, which was up a more solid 24.0%!  Here are the 50 stocks in descending performance order:

Date	Stock	Initial Price	End Price	Percent Change
11/25/2011	CRAY	5.60	13.57	142.3%
11/25/2011	OSIR	4.13	9.12	120.8%
11/25/2011	GTIV	5.17	9.96	92.6%
11/25/2011	PRX	29.01	50.00	72.4%
11/25/2011	MDF	6.62	11.20	69.2%
11/25/2011	EGY	5.13	8.09	57.7%
11/25/2011	DLX	19.05	29.47	54.7%
11/25/2011	AFAM	12.53	19.19	53.2%
11/25/2011	LPS	16.18	24.53	51.6%
11/25/2011	MRX	29.62	43.29	46.2%
11/25/2011	PDLI	5.51	7.60	37.8%
11/25/2011	TER	11.68	15.93	36.4%
11/25/2011	RTN	41.60	56.20	35.1%
11/25/2011	NVMI	5.80	7.73	33.3%
11/25/2011	HRB	13.69	18.23	33.2%
11/25/2011	PETS	8.48	11.10	30.9%
11/25/2011	GME	20.92	27.07	29.4%
11/25/2011	KLIC	8.29	10.68	28.8%
11/25/2011	NOC	51.62	65.36	26.6%
11/25/2011	VECO	22.04	27.66	25.5%
11/25/2011	CHKE	11.28	14.10	25.0%
11/25/2011	NBIX	6.00	7.23	20.5%
11/25/2011	MSFT	23.63	27.70	17.2%
11/25/2011	FRX	28.63	33.32	16.4%
11/25/2011	KLAC	40.81	45.17	10.7%
11/25/2011	DLB	30.00	32.62	8.7%
11/25/2011	VPHM	21.95	23.86	8.7%
11/25/2011	AMED	9.78	10.31	5.4%
11/25/2011	AMAT	9.94	10.40	4.6%
11/25/2011	VG	2.20	2.24	1.8%
11/25/2011	CJES	19.25	19.03	-1.1%
11/25/2011	TSRA	15.38	14.94	-2.9%
11/25/2011	PWER	4.26	4.11	-3.5%
11/25/2011	TNAV	8.24	7.51	-8.9%
11/25/2011	NSU	4.98	4.43	-11.0%
11/25/2011	USMO	12.30	10.92	-11.2%
11/25/2011	SNDK	45.56	40.13	-11.9%
11/25/2011	CMTL	28.18	24.66	-12.5%
11/25/2011	CPLA	32.00	27.42	-14.3%
11/25/2011	MANT	29.85	25.07	-16.0%
11/25/2011	GNI	90.30	71.11	-21.3%
11/25/2011	UIS	21.20	16.36	-22.8%
11/25/2011	CPIX	5.89	4.39	-25.5%
11/25/2011	MNTA	14.57	10.60	-27.2%
11/25/2011	DELL	14.11	9.55	-32.3%
11/25/2011	STRA	83.24	49.44	-40.6%
11/25/2011	GTAT	7.30	3.36	-54.0%
11/25/2011	APOL	44.75	18.86	-57.9%
11/25/2011	CECO	6.91	2.74	-60.3%
11/25/2011	ESI	51.52	17.00	-67.0%

Feel like we have heard this song before? Just looking at bottom three, I think we can fairly state that for Profit Education was a drag. But they had plenty of company. I will say that this month there were some very good choices. CRAY was most excellent for a start.

Here is a listing of every monthly portfolio I have tracked.

 

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	-2.9%	10.4%
11/26/2010	-8.5%	1.4%
1/3/2011	-11.4%	0.1%
1/28/2011	-7.6%	4.9%
2/25/2011	-5.5%	5.0%
3/24/2011	-4.4%	7.4%
4/21/2011	-16.0%	3.2%
5/27/2011	-12.0%	-0.4%
6/24/2011	-9.5%	5.0%
7/29/2011	-4.3%	8.1%
8/26/2011	12.0%	21.6%
9/30/2011	23.5%	29.6%
10/28/2011	0.4%	11.5%
11/25/2011	13.9%	24.0%
12/29/2011	6.0%	13.5%
1/27/2012	-1.2%	8.1%
2/24/2012	-2.1%	3.9%
3/23/2012	-4.8%	1.8%
4/27/2012	-1.5%	1.3%
5/25/2012	2.4%	7.8%
6/22/2012	4.0%	6.7%
7/27/2012	0.3%	2.7%
8/24/2012	-2.9%	0.7%
9/28/2012	-5.0%	-1.6%
10/26/2012	-1.0%	0.2%

You will note the sad fact that this is the 23rds straight portfolio to lose (that is hard to do... it ain't random) and remarkably all 11 open portfolios are trailing as well.  Maybe we should buy a dartboard instead of using this?  Or maybe we should SHORT all these stocks?  Hmmm.  If you go back and see my posts the last few months, the words don't change... just the count.

Subsets

I also keep 2 subsets of the larger portfolios:  (1) dividend stocks (those with a yield per Yahoo of at least 2.6%) and (2) new stocks (those new to the tracking portfolios in past 12 months.  The dividend portfolio was decent, up about 8.6%.  The new portfolio was just okay, up 6.6%.  Finally, I like to track cash as it is more "honest" than percentages as if you go up by 25% and then down by 25%, that is a different result than up by 5% then down by 5%.  So I track what you would have to day if you had spread $100,000 over the first twelve portfolios evenly.

 

Category	Value
Total	111,328
Total New	106,332
Total Dividend	243,730
Total Russell 3K	126,093

 That is real money, down 13% overall of R3K.  More Later!