Sunday, August 24, 2014

MFI - The Recent Struggle Is Real

MFI - The Struggle Is Real

While my personal MFI portfolio is hanging in there: I am up 11.6% on the year in absolute real money terms and I am up 12% in hypothetical terms (ignoring the $ I have added to my MFI tranches during 2014).  That compares with my MFI Index, which is up 7.3% and the Russell 3000 which is up 8.15%.

I also checked out the Motley Fool Caps

TrackJGreenblatt

and while it has been a stellar performer in total, it has been on a downward track since March.  Here is a graph of his performance against my own CAPS portfolio (which I really use as a way to track ideas (it is much more than MFI) and I short stocks occasionally, which has never worked).



Here is my table showing the MFI Index versus R3K back into time:

Annual Inception to Date
Year Russell MFI Russell ITD MFI ITD
2006 11.40% 15.03% 11.40% 15.03%
2007 4.09% -6.69% 15.96% 7.34%
2008 -37.05% -37.97% -27.00% -33.42%
2009 32.51% 45.18% -3.27% -3.34%
2010 18.38% 22.77% 14.50% 18.67%
2011 -0.56% -10.47% 13.87% 6.25%
2012 16.43% 9.70% 32.57% 16.56%
2013 33.01% 51.70% 76.34% 76.82%
2014 8.15% 7.31% 90.70% 89.74%

It is always amazing to look at that. Talk about a dead heat. Since 2006 90.7% versus 89.7%.  

Open Tracking Portfolios

Here are my 12 open tracking portfolios.  Only 2 are winning.

Date MFI R3K Lead
8/30/2013 15.9% 23.5% 0
9/27/2013 14.0% 18.5% 0
10/25/2013 8.1% 13.7% 0
11/29/2013 6.8% 11.2% 0
12/31/2013 7.8% 8.2% 0
1/31/2014 12.1% 11.7% 1
2/28/2014 7.5% 6.7% 1
3/28/2014 0.8% 7.1% 0
4/25/2014 1.0% 7.1% 0
5/30/2014 1.6% 3.7% 0
6/27/2014 -1.4% 1.4% 0
7/25/2014 0.2% 0.9% 0
Average 6.2% 9.5% 0
I find it interesting that the April 25th looks a lot like my May 6th tranche:

5/6/2014 Start Current Dividend Pct Gain R3K Gain
AVG $19.57 $18.40 $0.00 -6.0% 6.3%
CA $29.54 $28.24 $0.50 -2.7% 6.3%
CSCO $22.79 $24.65 $0.19 9.0% 6.3%
NSR $25.82 $29.36 $0.00 13.7% 6.3%
RCII $28.78 $26.26 $0.23 -8.0% 6.3%
Totals 1.2% 6.3%
Though I suppose that is just a coincidence.

Current Stocks In MFI Index

Here is how the individual stocks are doing in my index:

Stock Start June 30th Current YTD Change Change in 3rd Quarter
  ATVI      17.83         22.50         23.33 30.8% 3.7%
  MO      38.39         42.42         43.55 13.4% 2.7%
  APOL      27.32         31.25         27.74 1.5% -11.2%
  AAPL    561.02      656.85       718.87 28.1% 9.4%
  AGX      27.56         37.29         38.34 39.1% 2.8%
  BAH      19.15         21.45         22.17 15.8% 3.4%
  BKE      52.56         44.80         49.45 -5.9% 10.4%
  CA      33.65         29.24         28.99 -13.8% -0.9%
  CACI      73.22         70.21         71.13 -2.9% 1.3%
  CHE      76.62         94.12       103.35 34.9% 9.8%
  CRUS      20.43         22.74         24.21 18.5% 6.5%
  CSCO      22.43         25.21         25.01 11.5% -0.8%
  COH      56.13         34.87         38.04 -32.2% 9.1%
  CRTX         9.49           9.50            9.50 0.1% 0.0%
  DLX      52.19         59.13         59.87 14.7% 1.3%
  DHX         7.25           7.61            8.59 18.5% 12.9%
  EBIX      14.71         14.46         14.19 -3.5% -1.9%
  EGL      33.40         38.26         35.62 6.6% -6.9%
  GME      49.26         41.13         43.56 -11.6% 5.9%
  GTIV      12.41         15.06         18.27 47.2% 21.3%
  GNI      68.10         22.09         27.03 -60.3% 22.3%
  HLF      78.70         64.84         50.25 -36.1% -22.5%
  IQNT      11.41         14.02         11.84 3.8% -15.5%
  ESI      33.58         16.69            8.89 -73.5% -46.7%
  LPS      37.38         37.30         37.30 -0.2% 0.0%
  LQDT      22.66         15.76         15.25 -32.7% -3.2%
  LO      50.68         62.20         61.70 21.7% -0.8%
  MSFT      37.41         42.26         45.71 22.2% 8.2%
  MYGN      20.98         38.92         36.51 74.0% -6.2%
  NATR      17.32         17.17         16.51 -4.7% -3.8%
  NOC    114.61      120.94       128.91 12.5% 6.6%
  PDLI         8.44           9.98         10.01 18.6% 0.0%
  PFMT      10.30         10.10         10.02 -2.7% -0.8%
  PETS      16.63         13.82         14.84 -10.8% 7.4%
  PRSC      25.72         36.59         44.84 74.3% 22.5%
  QCOR      54.45         92.79         94.50 73.6% 1.8%
  RTN      90.70         92.86         97.79 7.8% 5.3%
  RAI      49.99         61.69         59.34 18.7% -3.8%
  RPXC      16.90         17.75         15.24 -9.8% -14.1%
  SAIC      33.07         45.28         44.57 34.8% -1.6%
  SWHC      13.49         14.54         12.98 -3.8% -10.7%
  STRA      34.47         52.51         59.85 73.6% 14.0%
  RGR      73.09         60.04         51.83 -29.1% -13.7%
  UIS      33.57         24.74         23.09 -31.2% -6.7%
  UNTD      13.76         10.40         12.32 -10.5% 18.5%
  SPOK      14.28         15.65         15.26 6.8% -2.5%
  USNA      75.58         78.14         73.73 -2.4% -5.6%
  VCI      34.25         34.02         34.02 -0.7% 0.0%
  VGR      16.37         21.08         24.06 47.0% 14.1%
  WTW      32.93         20.17         24.26 -26.3% 20.3%
Total    17,682      18,688       18,974 7.3% 1.5%

So QCOR, STRA, MYGN and PRSC are the best stocks. Three are associated with healthcare (GTIV is another). Coincidence or is healthcare a space to be in? It is almost unfair that MFI gets hit with the GNI crash and burn. That was so obvious as it was known the trust would be dissolved. That is actually a poster child stock for proof that the stock market is not always efficient on specific stocks. ESI is the other absolute disaster. It is interesting (as long as you didn't own ESI) on the divergence of the For Profit Education Stocks.  Why did STRA do so well and ESI so poorly?

Current Top 50 List

Here is the current Top 50 List

Ticker Mkt Cap Date
AFOP 263.68 22-Aug
APEI 530.04 22-Aug
ANIK 604.05 22-Aug
APOL 3,129.88 22-Aug
AGX 550.91 22-Aug
HRB 9,263.42 22-Aug
BCOR 660.32 22-Aug
BAH 3,383.51 22-Aug
BRCD 4,214.15 22-Aug
BKE 2,358.31 22-Aug
CA 12,432.38 22-Aug
GIB 10,768.27 22-Aug
CSCO 124,605.80 22-Aug
COH 10,124.56 22-Aug
CNVR 1,732.50 22-Aug
DLX 2,936.78 22-Aug
DEPO 864.85 22-Aug
EBIX 539.07 22-Aug
HLF 4,585.41 22-Aug
ONE 187.49 22-Aug
IQNT 387.04 22-Aug
IILG 1,222.88 22-Aug
ESI 207.76 22-Aug
KING 4,435.43 22-Aug
LBMH 153.10 22-Aug
LFVN 135.23 22-Aug
LQDT 451.92 22-Aug
MYGN 2,981.48 22-Aug
NHTC 141.72 22-Aug
NSR 1,761.40 22-Aug
NOC 26,684.73 22-Aug
NUS 2,931.71 22-Aug
PTIE 186.42 22-Aug
PDLI 1,684.74 22-Aug
PENN 830.30 22-Aug
PFMT 486.31 22-Aug
PETS 289.31 22-Aug
RTN 30,009.24 22-Aug
RPXC 853.53 22-Aug
SWHC 718.48 22-Aug
SPOK 322.03 22-Aug
STRA 652.72 22-Aug
RGR 986.33 22-Aug
SPRT 130.01 22-Aug
TTWO 2,266.47 22-Aug
TZOO 256.81 22-Aug
UIS 1,169.16 22-Aug
USNA 988.28 22-Aug
VIAB 34,241.01 22-Aug
WTW 1,374.84 22-Aug
Definitely some risky stocks here. But one thing about MFI is that there are always several of the riskier, hairier stocks that end up being the 70% gainers.

Have a great Sunday everyone.

2 comments:

Thomas Holroyd said...

Hi MG,

Great blog! Really enjoy reading your posts. Am about to start investing using the MFI system - interesting to see the returns vs R3K have turned out to be a dead heat since 2006. Let's hope for some outperformance over the next few years...

Best,

TH

Marsh_Gerda said...

TH - thanks for the note. I am certainly rooting for MFI to outperform as well. I have to say that I as I review stocks in the lists, I am finding fewer and fewer to be excited about. But it just takes five.

PERI is one that looks interesting.