Weekend Update - 9/6/14

Weekend Update - 9/6/14

It doesn't look or feel like fall yet (feels more like a muggy Atlanta), but I know here in New England it is just around the corner.  This week it will get much more seasonable, with highs in mid 70s and lows in the 50s.

Just completed a mediocre week.  Doesn't really help when top two holdings, GTAT and GNW are down 4.6% and 6.8%. As my readers know, I have long term conviction on both of these stocks, so I will hold through the bumps and occasionally add on the dips.

Table of All Stocks

Here is a table of all my stocks and how they did this week (with multiplier):

Index	Stock	8/29/2014	Current	Weekly Change	$ Gain
1	GTAT	17.81	16.99	-4.6%	(11,480)
2	GNW	14.19	13.23	-6.8%	(13,325)
3	BBEP	22.88	22.63	-1.1%	(1,428)
4	AOD	8.88	8.95	0.8%	1,006
5	KLIC	14.69	14.95	1.8%	1,820
6	RIOM	2.86	2.88	0.7%	700
7	ATVI	23.54	24.02	2.0%	1,931
8	TLM	10.07	9.97	-1.0%	(950)
9	GPS	46.15	44.65	-3.3%	(3,000)
10	BAC-WTA	7.16	7.17	0.1%	120
11	NTC	12.62	12.61	0.0%	(43)
12	CSQ	12.02	12.05	0.2%	212
13	FSC	9.83	9.86	0.3%	254
14	TGONF	11.40	11.45	0.4%	350
15	TPVG	15.52	15.30	-1.4%	(1,128)
16	TNH	148.75	148.41	-0.2%	(170)
17	CSCO	24.99	25.00	0.0%	30
18	TCMCF	14.75	14.75	0.0%	-
19	RPXC	15.19	15.23	0.3%	170
20	NADL	10.96	9.99	-8.9%	(6,175)
21	AVG	17.54	17.35	-1.1%	(621)
22	AGX	40.05	38.22	-4.6%	(2,709)
23	SNDK	97.96	98.79	0.8%	472
24	SYNA	82.10	84.39	2.8%	1,424
25	TSL	12.53	13.00	3.8%	1,880
26	KLAC	76.42	78.31	2.5%	1,232
27	WNR	46.53	47.56	2.2%	1,041
28	TIME	23.48	23.78	1.3%	600
29	EXETF	7.82	7.82	0.0%	-
30	HIG-WT	28.64	28.36	-1.0%	(462)
31	BRCD	10.55	10.31	-2.3%	(1,028)
32	CBI	63.42	63.36	-0.1%	(41)
33	ITRN	21.90	21.73	-0.8%	(319)
34	NSR	29.49	29.12	-1.3%	(429)
35	CA	28.24	29.22	3.5%	993
36	RCII	27.86	28.24	1.4%	396
37	UEPS	12.26	13.71	11.8%	2,900
38	O	44.72	45.35	1.4%	380
39	Overall			-1.1%	(25,400)

Transactions and Stuff

I did have a few transactions during the week. I did increase my long term option play on GNW by 20%.  I had bought initial options (Jan 2016 with a $17 strike price) at $1.24.  I added at $1.05.

I also bought a new dividend stock (EXETF).  This is a Canadian nursing home firm with US homes as well.  They are very interesting.  They pay a monthly dividend, that works out to about a 6% yield.  Then they are cheap, by all measures and are looking to spin-off their US assets.  Nursing homes in the US have been going for a decent premium lately - GTIV is great example of that.  I read about them here (I’m Buying More Extendicare).  I have no trouble stealing other people's ideas.

Then another interesting opportunity coming up soon is the IPO of Alibaba.  I will be watching this one and will likely jump in.  Stay tuned.

MFI Portfolio

I am not sure if other readers watched CorpRaider's video link he placed here.  I found the first 15 minutes to be fascinating.  It described meta studies that show that simple models in many instances work better than expert judgment. Of course MFI is in essence a simple model.  Then there were two other very interesting points: (1) simple models work better than an expert who is given access to the simple model (even Greenblatt said this was true for him) and (2) the earning yield is much more important than ROIC (he actually went so far as to say the addition of ROIC made things a bit worse)!  So if you believe JG (and why shouldn't we), we are all wasting our time trying to "do better". Just take the top 50, pick five totally randomly, rinse and repeat.  That seems so simple, but feels wrong.  I just have trouble letting go like that with real money.

But if you compare the results of TrackJGreenblatt (which is totally random) with MagicDiligence
 (which is attempting to add expert judgment to the simple model) - it does seem that random is better.

11/15/13 Stocks	Start	Current	Dividend	Pct Gain	R3K Gain
AVG	$17.22	$17.35	$0.00	0.8%	12.8%
ATVI	$17.71	$24.02	$0.20	36.8%	12.8%
GA	$9.04	$11.90	$0.23	34.2%	12.8%
RPXC	$17.04	$15.23	$0.00	-10.6%	12.8%
SYNA	$48.01	$84.39	$0.00	75.8%	12.8%
Totals				27.4%	12.8%
2/1/14 Stocks	Start	Current	Dividend	Pct Gain	R3K Gain
ATVI	$17.13	$24.02	$0.20	41.4%	12.9%
KLAC	$61.47	$78.31	$1.40	29.7%	12.9%
RPXC	$16.22	$15.23	$0.00	-6.1%	12.9%
SNDK	$69.55	$98.79	$0.53	42.8%	12.9%
WNR	$39.11	$47.56	$0.78	23.6%	12.9%
Totals				26.3%	12.9%
5/6/2014	Start	Current	Dividend	Pct Gain	R3K Gain
AVG	$19.57	$17.35	$0.00	-11.4%	7.4%
CA	$29.54	$29.22	$0.50	0.6%	7.4%
CSCO	$22.79	$25.00	$0.19	10.6%	7.4%
NSR	$25.82	$29.12	$0.00	12.8%	7.4%
RCII	$28.78	$28.24	$0.23	-1.1%	7.4%
Totals				2.3%	7.4%
8/15/2014	Start	Current	Dividend	Pct Gain	R3K Gain
CSCO	$24.40	$25.00	$0.00	2.5%	2.8%
AGX	$36.71	$38.22	$0.00	4.1%	2.8%
ITRN	$21.32	$21.73	$0.00	1.9%	2.8%
BRCD	$9.34	$10.31	$0.00	10.4%	2.8%
CBI	$58.25	$63.36	$0.00	8.8%	2.8%
Totals				5.5%	2.8%
Category/Tranche	August	November	February	May	Total
Initial Investment	25,000	25,000	25,000	25,000	100,000
Current Tranche	5.5%	27.4%	26.3%	2.3%	15.5%
Previous Tranche	41.4%	43.7%	78.3%	33.0%	49.5%
Tranche -2	14.1%	-	-	-	3.5%
MFI Overall Gain	70.2%	83.1%	125.1%	36.1%	78.6%
Current Balance	42,561	45,775	56,270	34,021	178,626
R3K Current Tranche	19.4%	12.8%	12.9%	7.4%	13.1%
R3K Overall Gain	50.0%	54.2%	36.7%	27.7%	42.1%
R3K Balance	37,489	38,547	34,175	31,914	142,125
Annualized IRR	29.5%	39.7%	66.3%	25.9%	41.5%

Here you can see I have opened up a 36.5 point cushion over R3K.  The November tranche just has two months+ to go.  It does look like another strong winner for me.

Discretionary Portfolio

This portfolio did struggle with GTAT and GNW having down weeks.  I did move TLM this past week from discretionary to my dividend portfolio.

Stock	Shares	Avg Cost	Current Price	Pct Change	R3K Change	Diff
AGX	190	36.71	38.22	4.1%	2.8%	1.4%
BAC-WTA	12,000	6.05	7.17	18.4%	14.4%	4.0%
GNW	13,880	10.08	13.23	31.3%	24.9%	6.4%
GTAT	14,000	9.15	17.39	89.9%	12.4%	77.5%
HIG-WT	1,650	21.24	28.36	33.5%	22.2%	11.3%
KLIC	7,000	11.48	14.95	30.3%	17.6%	12.7%
RIOM	35,000	1.97	2.88	46.0%	7.4%	38.6%
TSL	4,000	12.58	15.71	24.9%	2.2%	22.7%
UEPS	2,000	13.79	13.71	-0.6%	0.1%	-0.7%
Total Open				40.6%	14.7%	26.0%
Closed				1.7%	1.2%	0.5%
Combined				6.0%	2.7%	3.3%

UEPS bounced back very stringly (about 11%). I was clearly about 7 hours early to that party.  Buying (or selling) before/after the market opens /closes rarely works out for me.  Oh well. The TSL result isn't quite right. It needs to be capped at $13.45 to reflect the options I sold.

Dividend Portfolio

Never exciting, this portfolio continues to go x-dividend and pay me along the way. BBEP and NADL just went x-dividend this week, with pretty sizable payments.

Stock	Shares	Avg Cost	Current Price	Dividends Received	Pct Change	R3K Change	Diff
AOD	14,186	8.03	8.95	11,717.83	21.7%	23.9%	-2.2%
BBEP	5,713	16.74	22.63	11,607.88	47.3%	17.4%	29.9%
CSQ	7,001	8.72	12.05	14,277.43	61.7%	58.7%	3.0%
EXETF	6,000	7.82	7.82	-	0.1%	0.0%	0.1%
FSC	8,395	9.57	9.86	3,767.52	7.7%	7.5%	0.2%
GPS	2,000	40.55	44.65	440.00	10.7%	6.5%	4.2%
NADL	6,366	9.60	9.99	2,727.85	8.5%	4.9%	3.6%
NTC	6,784	12.02	12.61	2,671.53	8.3%	8.3%	0.0%
O	600	21.02	45.35	9,460.47	190.7%	120.2%	70.5%
OIBAX	4,147	5.00	6.13	8,261.12	62.4%	130.5%	-68.1%
TCMCF	4,903	13.89	14.75	-	6.2%	1.1%	5.1%
TGONF	7,000	10.27	11.45	3,452.50	16.3%	22.1%	-5.9%
TIME	2,000	22.89	23.78	-	3.9%	2.6%	1.3%
TLM	9,500	10.03	9.97	-	-0.6%	0.3%	-0.9%
TNH	500	148.10	148.41	1,555.00	2.3%	4.8%	-2.5%
TPVG	5,128	15.54	15.30	3,599.70	2.9%	5.7%	-2.7%
Total Open				73,539	17.7%	15.5%	2.2%
Closed					12.0%	10.9%	1.1%
Combined					13.1%	11.8%	1.3%
Annualized IRR Since 12/31/10					18.1%
2014 Gain					9.0%

This portfolio was hurt this week by GPS having poor August sales. Still, I like the company and their price and their dividend.  There will be better months down the road.  I did add EXETF this week.  Here are my expected annual dividends (with multiplier) from this portfolio:

Stock	Shares	Ann Dividend / Share	Yield	Projected Dividend	Worth
AOD	14,186	0.68	7.6%	9,618	126,968
BBEP	5,713	2.01	8.9%	11,484	129,290
CSQ	7,001	1.00	8.3%	7,001	84,367
EXETF	6,000	0.48	6.1%	2,880	46,947
FSC	8,395	1.10	11.2%	9,235	82,776
GPS	2,000	0.88	2.0%	1,760	89,300
NADL	6,366	0.96	9.6%	6,111	63,597
NTC	6,784	0.68	5.4%	4,640	85,571
O	600	2.17	4.8%	1,303	27,230
OIBAX	4,147	0.29	4.7%	1,203	25,420
TCMCF	4,903	1.60	10.8%	7,845	72,319
TGONF	7,000	0.62	5.4%	4,340	80,150
TIME	2,000	0.80	3.4%	1,600	47,560
TLM	9,500	0.27	2.7%	2,565	94,715
TNH	500	12.04	8.1%	6,020	74,205
TPVG	5,128	1.20	7.8%	6,154	78,460
Total			6.9%	83,759	1,208,875

6.9% and $83,759 a year is very nice.  There is a real comfort in those numbers.  If nothing else, dividend stocks/securities make you remember why you are investing.

Options

I continue to have some smallish option positions, some are sold calls (like a dividend), some are short term calls I have bought (hoping for a stock spike ==> feels like gambling) and some are longer term calls I bought (all GNW, essentially a leveraged way to buy the stock).  The jury is still out on whether this will become a regular strategy.  I find that they make me too nervous (especially the short term) as there is a lot of even daily volatility, and then I have sellers remorse (like with TSL, where I have given up upside).

Open Date	Ticker	Type	Shares	Open Price	Current Price	Strike	Expiration	Gain
3/28/14	GTAT	Sell	3,000	2.40	0.55	22.00	9/20/14	5,550
6/18/14	TSL	Sell	4,000	1.45	-	13.00	9/20/14	5,800
8/21/14	GNW	Buy	10,000	1.24	0.89	17.00	1/15/16	(3,500)
8/22/14	TLM	Buy	10,000	0.55	0.31	11.00	10/18/14	(2,375)
8/28/14	SLV	Buy	10,000	0.66	0.38	11.00	10/18/14	(2,800)
9/4/14	GNW	Buy	2,000	1.05	0.89	17.00	1/15/16	(320)
9/5/14	ATVI	Sell	4,000	0.88	-	26.00	2/20/15	3,520
	Total							5,875

I think that makes it a wrap.  Have a great weekend.  I will close with my week-by-week graph of 2014: