Weekend Update 9/27/14

Weekend Update

Early fall is fully here in Connecticut. Leaves are starting to show color.  I took yesterday afternoon off and took a 20 mile bike ride.  Just a perfect day. Then in the evening I went and watched the local high school football team.  We were 2-0, so I thought we might be a bit better this year. But I had not noticed we were playing the #1 team in the state. We lost 47-7, and it could have been much, much worse.

To add insult to injury (literally), at halftime one of our cheerleaders fell from the pyramid.  Thankfully she was ok, but she was shaken up.  But we are band parents, and the band sounded good.  My son is now the drum major of the band, so he has a lot of responsibility to get them started, coordinated and setting the tempo.

This was my fourth straight losing week, though at least I finally did better than the index.  here is a table, with multiplier, showing my results since 8/29.

Index	Stock	8/29/2014	Current	Monthly Change	$ Gain
1	GNW	14.19	13.40	-5.6%	(10,965)
2	GTAT	17.81	11.48	-35.5%	(88,620)
3	AOD	8.88	8.61	-3.0%	(3,879)
4	TNH	148.75	144.54	-2.8%	(2,947)
5	BAC-WTA	7.16	7.56	5.6%	4,801
6	ATVI	23.54	21.25	-9.7%	(9,210)
7	NTC	12.62	12.39	-1.8%	(1,560)
8	CSQ	12.02	11.82	-1.7%	(1,420)
9	TGONF	11.40	11.07	-2.9%	(2,338)
10	CSCO	24.99	25.00	0.0%	30
11	TCMCF	14.75	13.30	-9.8%	(7,109)
12	NADL	10.96	6.78	-38.1%	(40,013)
13	RPXC	15.19	14.55	-4.2%	(2,717)
14	SNDK	97.96	99.21	1.3%	711
15	AVG	17.54	16.92	-3.5%	(2,027)
16	KLAC	76.42	80.06	4.8%	2,373
17	AGX	40.05	33.85	-15.5%	(9,177)
18	HIG-WT	28.64	29.21	2.0%	944
19	SYNA	82.10	75.00	-8.6%	(4,416)
20	BRCD	10.55	10.80	2.4%	1,071
21	TIME	23.48	22.91	-2.4%	(1,140)
22	EXETF	7.82	7.30	-6.7%	(3,147)
23	WNR	46.53	43.05	-7.5%	(3,517)
24	CBI	63.42	59.11	-6.8%	(2,952)
25	ITRN	21.90	21.20	-3.2%	(1,315)
26	RCII	27.86	30.02	7.8%	2,249
27	NSR	29.49	24.74	-16.1%	(5,510)
28	CA	28.24	27.89	-1.2%	(355)
29	OIBAX	6.15	6.04	-1.8%	(458)
30	O	44.72	41.43	-7.4%	(1,992)
31	Grand Total			-8.8%	-

Wow, that is depressing. I did not realize I was also down so much on NADL!  For the year, I am still in the black, up 6.2%. That trails the R3K by 90 basis points.  Well, I guess my theme song right now is "Wake Me Up When September Ends". 

MFI Portfolio

My MFI stocks (as you can see looking at the table) have not been immune from the recent sell-off.  They are down about 4% in that stretch.  This weekend is also the end of my 9/27/13 MFI tracking portfolio.  I can tell you that recent MFI continues to struggle.  The newest tranche, started 8/29 is down 5.4%. And every portfolio started since 3/28 is in the red. I guess that makes me feel better in a "misery loves company" sort of way.

11/15/13 Stocks	Start	Current	Dividend	Pct Gain	R3K Gain
AVG	$17.22	$16.92	$0.00	-1.7%	10.6%
ATVI	$17.71	$21.25	$0.20	21.1%	10.6%
GA	$9.04	$11.90	$0.23	34.2%	10.6%
RPXC	$17.04	$14.55	$0.00	-14.6%	10.6%
SYNA	$48.01	$75.00	$0.00	56.2%	10.6%
Totals				19.0%	10.6%
2/1/14 Stocks	Start	Current	Dividend	Pct Gain	R3K Gain
ATVI	$17.13	$21.25	$0.20	25.2%	10.6%
KLAC	$61.47	$80.06	$1.40	32.5%	10.6%
RPXC	$16.22	$14.55	$0.00	-10.3%	10.6%
SNDK	$69.55	$99.21	$0.53	43.4%	10.6%
WNR	$39.11	$43.05	$0.78	12.1%	10.6%
Totals				20.6%	10.6%
5/6/2014	Start	Current	Dividend	Pct Gain	R3K Gain
AVG	$19.57	$16.92	$0.00	-13.6%	5.2%
CA	$29.54	$27.89	$0.50	-3.9%	5.2%
CSCO	$22.79	$25.00	$0.19	10.6%	5.2%
NSR	$25.82	$24.74	$0.00	-4.2%	5.2%
RCII	$28.78	$30.02	$0.23	5.1%	5.2%
Totals				-1.2%	5.2%
8/15/2014	Start	Current	Dividend	Pct Gain	R3K Gain
CSCO	$24.40	$25.00	$0.00	2.5%	0.7%
AGX	$36.71	$33.85	$0.00	-7.8%	0.7%
ITRN	$21.32	$21.20	$0.19	0.3%	0.7%
BRCD	$9.34	$10.80	$0.00	15.7%	0.7%
CBI	$58.25	$59.11	$0.00	1.5%	0.7%
Totals				2.4%	0.7%
Category/Tranche	August	November	February	May	Total
Initial Investment	25,000	25,000	25,000	25,000	100,000
Current Tranche	2.4%	19.0%	20.6%	-1.2%	10.4%
Previous Tranche	41.4%	43.7%	78.3%	33.0%	49.3%
Tranche -2	14.1%	-	-	-	3.5%
MFI Overall Gain	65.2%	71.1%	114.9%	31.4%	70.7%
Current Balance	41,307	42,779	53,735	32,858	170,679
R3K Current Tranche	19.4%	10.6%	10.6%	5.2%	11.5%
R3K Overall Gain	46.9%	51.1%	34.0%	25.1%	39.3%
R3K Balance	36,735	37,781	33,493	31,275	139,284
Annualized IRR	26.7%	33.3%	58.9%	21.6%	36.0%

So the good news is that three of my four tranches are still winning.  No shame in my stock picking here.  Another good reason to focus my of my stock picking on MFI going forward.

As long as we are on MFI, a very interesting small cap came on the screen this week. I have not done well on small caps, but I may take a flier on this one in November if still on the list (CCUR).

Discretionary Portfolio

Pretty much in shambles here.  Next week we will get an update from GTAT (GT Advanced Technologies Inc. Schedules Webcasted Business Update).  I have no idea whether it will be good or bad news, but given my recent run I am thinking bad is more likely.

I did dabble in two IPOs this week, CNNX and CYBR.  I made a little money in both, but missed out on much larger potential gains.

Stock	Shares	Avg Cost	Current Price	Pct Change	R3K Change	Diff
AGX	190	36.71	33.85	-7.8%	0.7%	-8.5%
BAC-WTA	12,000	6.05	7.56	24.9%	12.1%	12.7%
GNW	13,880	10.08	13.40	33.0%	22.4%	10.6%
GTAT	14,000	9.15	12.56	37.2%	10.2%	27.1%
HIG-WT	1,650	21.24	29.21	37.6%	19.8%	17.8%
Total Open				32.6%	15.7%	16.8%
Closed				3.0%	1.4%	1.6%
Combined				4.9%	2.3%	2.6%

You can see the stocks here are really winding down with my recent stock purge. I'd suggest that these are all pretty core positions (except AGX).

Dividend Portfolio

NSDL has really drug this one down, though it has had some willing helpers.  As long as dividends are not cut, I am not so concerned as I am reinvesting dividends at cheaper prices.

Stock	Shares	Avg Cost	Current Price	Dividends Received	Pct Change	R3K Change	Diff
AOD	14,186	8.03	8.61	12,519.36	18.2%	21.4%	-3.2%
CSQ	7,050	8.74	11.82	14,847.48	59.4%	55.0%	4.4%
EXETF	6,000	7.82	7.30	-	-6.6%	-2.0%	-4.6%
NADL	9,572	9.11	6.78	2,727.85	-22.5%	1.5%	-24.0%
NTC	6,784	12.02	12.39	3,058.21	6.9%	6.1%	0.8%
O	603	21.12	41.43	9,570.23	171.4%	114.7%	56.7%
OIBAX	4,147	5.00	6.04	8,261.12	60.6%	125.9%	-65.3%
TCMCF	4,903	13.89	13.30	-	-4.2%	-0.9%	-3.3%
TGONF	7,000	10.27	11.07	3,452.50	12.5%	19.7%	-7.1%
TIME	2,000	22.89	22.91	-	0.1%	0.5%	-0.4%
TNH	700	146.54	144.54	1,555.00	0.1%	1.5%	-1.4%
Total Open				55,992	11.3%	16.8%	-5.4%
Closed					11.9%	10.5%	1.4%
Combined					11.9%	11.3%	0.5%
Annualized IRR Since 12/31/10					16.8%
2014 Gain					4.5%

Wow, even venerable TIME is struggling. EXETF has been a bad buy so far. 

BIG MFI Tranche

One of the hidden blessings about my deciding to head in a new investment direction a couple of weeks ago was that I sold off about 30% of my holdings.  While there were only one or two names I dis-liked in that purging, it has turned out to be a bit of a blessing as that group is also down about 4% since my sales (TLM and RIOM have been the sharpest drop offs).

So I am sitting on record levels of cash, with the market dropping that is not all bad. I plan to start next week the first of my 4 BIG MFI tranches.  I call them BIG as stocks will have to be at least $600 million market cap to qualify and I am putting more money in than I have in other MFI tranches.  Using my multipliers, my four open MFI tranches currently average $193,000 (they started at $100,000).  The new ones will start at $250,000.

I plan to start on Oct 1st (Wednesday).  

• I will take the official list on that day. 
• I will pull in the dividend yields (which will include special dividends in past 12 months).  
• I will then eliminate all stocks under 600 million market cap.
• I will also eliminate stocks under 2.4% yield.
• I will finally get to pick one stock to eliminate based on judgment.
• I will then randomly (and it will be random) select 5 stocks from the remaining list (right now that would be 9 names).

I have dropped the yield requirement from my testing slightly to 2.4% (from 2.6%) just to give a few more names a chance down the road to make it. In fact, if at least 5 stocks do not make cut, I will drop 200 basis points more (not an issue right now).  I will use the following website to do the random generation: (Research Randomizer).