I remember now. This is usually the time of year I start getting tired of winter. Supposed to get a couple more inches today and then another big dump on Monday. Frankly, not sure where we will b putting it. That will be 30+ inches over the past two weeks for us, and even more (probably 40ish) for eastern part of state. They are actually starting to have a shortage of road salt.
I had a strong week in the markets. I was up 3.7% and am now just a hair under break-even. I am down 6 basis points, R3K is up 26 basis points, MFI Index is down 1.97% (not very good), my MFI Select is down 5.4% (even worse) and my MFI Formula is up 3.3%.
So I think we can say that MFI is struggling right now. Going into the week, my 12 tracking portfolios were up an average of 1.1% versus the benchmark being up 2.5%. At the end of the week, the 12 portfolios were up 4.0% versus 5.6% overall - so the gap remained about the same overall.
MFI Select
Gad, down 5.4% on the year. That seems pretty depressing. It does seem like it has been a run of bad earnings reports:
- SNDK - SanDisk Drops After Sales Projection Falls Short of Estimates
- KLAC - KLA-Tencor Tops Q2 Estimates, Shares Down on Weak Outlook
- RCII - Rent-A-Center (RCII) Stock Is Down Today on Earnings Miss
- VIAB - Viacom reports higher revenue but income falls on expenses
- NSR - NeuStar (NSR) Crumbles: Stock Falls by 5.1%
- CA - CA Technologies (CA) Stock Falls on Mixed Guidance
Wow, sucks to put them all side-by-side like that. But that is the nature of investing. You do get negative surprises from time to time. A key is to figure out when those negative surprises are opportunities. I did buy more VIAB on their recent dip.
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| AVG | $19.57 | $20.00 | $0.00 | 2.2% | 10.7% |
| CA | $29.54 | $32.03 | $0.75 | 11.0% | 10.7% |
| $22.79 | $27.24 | $0.57 | 22.1% | 10.7% | |
| NSR | $25.82 | $24.78 | $0.00 | -4.0% | 10.7% |
| $28.78 | $29.54 | $0.70 | 5.1% | 10.7% | |
| Totals | 7.3% | 10.7% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| $24.40 | $27.24 | $0.38 | 13.2% | 6.0% | |
| AGX | $36.71 | $32.35 | $0.70 | -10.0% | 6.0% |
| ITRN | $21.32 | $21.68 | $0.38 | 3.5% | 6.0% |
| $9.34 | $11.88 | $0.04 | 27.6% | 6.0% | |
| $58.25 | $36.26 | $0.14 | -37.5% | 6.0% | |
| Totals | -0.6% | 6.0% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| $64.80 | $55.08 | $0.21 | -14.7% | 1.6% | |
| IPCM | $38.45 | $41.55 | $0.00 | 8.1% | 1.6% |
| VIAB | $72.29 | $67.07 | $0.33 | -6.8% | 1.6% |
| NHTC | $12.19 | $10.85 | $0.01 | -10.9% | 1.6% |
| $4.40 | $4.94 | $0.00 | 12.3% | 1.6% | |
| Totals | -2.4% | 1.6% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| VEC | $28.00 | $28.58 | $0.00 | 2.1% | 3.1% |
| $62.73 | $66.35 | $0.00 | 5.8% | 3.1% | |
| VIAB | $63.91 | $67.07 | $0.00 | 4.9% | 3.1% |
| $22.03 | $23.17 | $0.00 | 5.2% | 3.1% | |
| NHTC | $12.44 | $10.85 | $0.00 | -12.8% | 3.1% |
| Totals | 1.0% | 3.1% | |||
| Category/Tranche | August | November | February | May | Total |
| Initial Investment | 25,000 | 25,000 | 25,000 | 25,000 | 100,000 |
| Current Tranche | -0.6% | -2.4% | 1.0% | 7.3% | 0.9% |
| Previous Tranche | 41.4% | 14.2% | 8.5% | 33.0% | 21.7% |
| Tranche -2 | 14.1% | 43.7% | 78.3% | - | 34.0% |
| MFI Overall Gain | 60.3% | 60.2% | 95.3% | 42.7% | 64.6% |
| Current Balance | 40,065 | 40,050 | 48,830 | 35,666 | 164,612 |
| R3K Current Tranche | 6.0% | 1.6% | 3.1% | 10.7% | 5.3% |
| R3K Overall Gain | 54.6% | 59.0% | 41.0% | 31.6% | 46.5% |
| R3K Balance | 38,645 | 39,758 | 35,238 | 32,894 | 146,536 |
| Annualized IRR | 20.9% | 23.5% | 39.4% | 22.4% | 25.8% |
You look at these tables, and you have to admit a 25.8% IRR since the reboot is strong. But you can see my overall gain (64.6%) is starting to narrow versus R3K (46.5%). The sad part is all four of my open tranches are trailing and the two most recently closed lost. So I am on a losing streak.
MFI Formula
Recall the mantra of this portfolio - a simple formula can beat a simple formula used by an expert. Not that I am a expert, but those words warn that meddling can be counter-productive. So in the formula, I identify stocks from official list using a formula (over $600m market cap and a dividend over 2.4%) and then I randomly pick 5 stocks - even if they duplicate with prior tranches. I think these points are important as a stock that has dropped a bunch in a quarter may be even a better buy for the next tranche - and not allowing it to be picked could bias results down.
| 10/1/2014 Stocks | Start | Current | Dividend | Pct Gain | R3K Gain |
| BAH | $23.52 | $28.90 | $0.24 | 23.9% | 5.5% |
| $45.55 | $49.70 | $3.22 | 16.2% | 5.5% | |
| CA | $27.87 | $32.03 | $0.25 | 15.8% | 5.5% |
| $41.70 | $36.76 | $0.33 | -11.1% | 5.5% | |
| $44.56 | $52.76 | $0.35 | 19.2% | 5.5% | |
| Totals | 12.8% | 5.5% | |||
| 12/31/14 Stocks | Start | Current | Dividend | Pct Gain | R3K Gain |
| CA | $30.83 | $32.03 | $0.00 | 3.9% | -0.9% |
| $28.36 | $27.24 | $0.19 | -3.3% | -0.9% | |
| $34.81 | $41.83 | $0.00 | 20.2% | -0.9% | |
| $34.21 | $36.76 | $0.00 | 7.5% | -0.9% | |
| IQNT | $19.87 | $17.44 | $0.00 | -12.2% | -0.9% |
| Totals | 3.2% | -0.9% |
Wow, look at that first tranche. A 7 point lead as 4 of 5 stocks are kicking butt. Really helped by strong NUS earnings (up 13% in one day). Many readers here said they would not have touched NUS, I can't disagree and that is why I hold my nose and use the formula. A sharp eyed reader may note that in the 12/31/14 tranche that R3K is down 0.9% and I had stated above that R3K is up for 2015 by 26 basis points. I marked R3K at the moment I bought my 5 stocks, not at the end of the day. R3K dropped significantly (about one percent) on 12/31.
| Category/Tranche | October | January | April | July | Total |
| Initial Investment | 249,820 | 249,939 | 250,000 | 250,000 | 999,759 |
| Current Tranche | 12.8% | 3.2% | 4.0% | ||
| Previous Tranche | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| Tranche -2 | 0.0% | - | - | - | 0.0% |
| MFI Overall Gain | 12.8% | 3.2% | 0.0% | 0.0% | 4.0% |
| Current Balance | 281,790 | 257,937 | 250,000 | 250,000 | 1,039,727 |
| R3K Current Tranche | 5.5% | -0.9% | 0.0% | 0.0% | 1.2% |
| R3K Overall Gain | 5.5% | -0.9% | 0.0% | 0.0% | 1.2% |
| R3K Balance | 263,513 | 247,757 | 250,000 | 250,000 | 1,011,269 |
| Annualized IRR | 40.1% | 35.0% | 0.0% | 0.0% | 39.7% |
| Date | Differential | Value |
| 0.00% | 1,000,000 | |
| 1.63% | 1,022,880 | |
| 0.30% | 1,013,750 | |
| -0.33% | 1,006,644 | |
| 1.67% | 1,012,806 | |
| Current | 2.85% | 1,039,727 |
Miscellaneous
Actually a bunch of my discretionary stocks had a great week.
| Stock | Start | End | Change |
| BAC-WTA | 5.95 | 6.06 | 1.8% |
| HIG-WT | 30.96 | 32.13 | 3.8% |
| 16.30 | 18.51 | 13.6% | |
| GNW | 6.98 | 7.76 | 11.2% |
| CSIQ | 20.39 | 25.00 | 22.6% |
CSIQ is capped at $25 as I sold calls (2/20 at $25 for $1.10). Ironic that the one stock I sold calls on is the one doing the best!
Have a great weekend everyone/
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1 comment:
Marsh,
It is way too early but your MFI formula is up 7.9% and mine is up 5.7%. I only have 6 of your stocks so we have a basket of 18 stocks picked by formula that is killing the index. It has been helped with NUS. Mine IRR is 20 points above the index.
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