Saturday, March 28, 2015

Monthly Tracking Portfolio - 3/28/14

Monthly Tracking Portfolio Update

Another month has zipped by. 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 Russell 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.

Onward

 Fearless readers will recall we had a 29 month "losing streak"..  Then we had a 13 month winning streak. This month, our mini three month winning streak was snapped.  Too many bad stocks (WTW, ESI, APOL, PFMT etc). Here are the 50 stocks in descending performance order:

Stock  Initial Price   End Price  Percent Change  52 week low   Mkt Cap 
EBIX              16.39           30.16 84.0%       12.12           636
KRFT              53.25           89.10 67.3%       53.33       33,173
AAPL              75.27         123.25 63.7%       73.05     477,388
QCOR              61.68           93.60 51.8%       58.89         3,747
USNA              74.02         111.38 50.5%       63.22         1,025
BAH              20.39           29.20 43.2%       20.65         3,151
MO              35.54           50.34 41.6%       37.13       73,699
RAI              50.84           70.60 38.9%       53.04       28,479
CHE              88.07         120.67 37.0%       80.94         1,558
NOC            119.34         160.48 34.5%      116.11       26,508
DLX              49.79           66.93 34.4%       48.42         2,555
LO              51.26           68.19 33.0%       51.84       19,429
STRA              45.83           59.93 30.8%       41.52           492
PENN              11.95           15.53 30.0%       10.07         1,043
PETS              12.48           16.18 29.6%       12.07           262
DNB              97.90         126.53 29.2%       98.01         3,751
CTSH              49.69           63.00 26.8%       41.51       15,074
CSCO              21.66           27.13 25.3%       22.30     115,500
NDZ              10.41           13.00 24.9%         N/A            644
DHX                7.18             8.82 22.8%         6.73           391
AGX              28.59           34.68 21.3%       26.09           417
IQNT              13.50           15.96 18.2%       10.06           445
TTWO              21.48           25.26 17.6%       18.45         2,168
BKE              42.54           49.35 16.0%       41.96         2,202
ATVI              20.24           22.76 12.5%       17.73       14,317
MYGN              32.87           35.76 8.8%       31.56         2,717
CA              29.82           32.29 8.3%       25.25       13,667
NATR              12.30           13.07 6.3%       11.88           225
MSFT              39.24           40.97 4.4%       38.51     333,494
EGL              44.39           43.37 -2.3%       30.22           765
GME              39.30           38.36 -2.4%       31.69         4,590
BWC              32.10           31.26 -2.6%       26.58         3,585
PDLI                7.44             7.04 -5.4%         6.52         1,354
SWHC              14.33           13.15 -8.2%         9.03           783
RPXC              16.16           14.22 -12.0%       11.94           874
COH              47.96           41.31 -13.9%       32.72       13,786
KING              18.08           15.53 -14.1%       10.68         5,535
RGR              58.51           50.23 -14.2%       33.60         1,160
UIS              28.73           23.00 -19.9%       18.72         1,269
HLF              55.65           43.17 -22.4%       27.60         5,623
BCOR              19.11           14.00 -26.7%       12.61           797
NSR              33.23           24.15 -27.3%       20.32         2,151
NUS              80.75           58.65 -27.4%       38.12         4,829
SPRT                2.49             1.60 -35.7%         1.57           142
APOL              32.85           19.20 -41.6%       19.09         3,691
LQDT              26.09             9.80 -62.4%         7.32           837
PFMT                9.21             3.34 -63.7%         3.28           439
WTW              20.65             7.39 -64.2%         6.83         1,162
PTIE                5.60             1.82 -67.5%         1.61           254
ESI              27.36             6.79 -75.2%         3.66           638


A late run by Kraft tried to save the day. But we ended up just 6.1% versus 12.3% for the index. A thorough stomp.

I did find another site that has been tracking since 2006 this week.  It uses a different approach, just 5 stocks picked randomly every quarter. They have had better results than me (TrackJGreenblatt's Stock Picks). I found it very interesting and would encourage people to take a looksee.

Here is a listing of every portfolio I have tracked:

Date MFI R3K Lead
1/6/2006 16.0% 10.9% 1
2/17/2006 21.2% 14.6% 1
3/29/2006 13.0% 9.6% 1
4/7/2006 10.3% 12.1% 0
5/12/2006 20.4% 18.6% 1
5/31/2006 29.2% 23.3% 1
6/30/2006 22.4% 20.0% 1
7/31/2006 19.7% 17.3% 1
8/31/2006 13.0% 13.3% 0
9/28/2006 12.7% 14.6% 0
10/27/2006 10.3% 12.0% 0
11/29/2006 -0.3% 4.8% 0
12/28/2006 -6.9% 3.4% 0
1/26/2007 -10.2% -6.6% 0
2/27/2007 -3.7% -1.0% 0
3/26/2007 -9.8% -5.5% 0
4/27/2007 -10.9% -5.0% 0
5/29/2007 -11.5% -6.3% 0
7/3/2007 -30.0% -15.6% 0
7/30/2007 -19.9% -11.5% 0
8/30/2007 -12.5% -8.7% 0
9/27/2007 -19.0% -18.2% 0
11/2/2007 -40.4% -34.3% 0
11/28/2007 -40.1% -38.3% 0
12/28/2007 -36.3% -40.0% 1
1/25/2008 -36.4% -35.9% 0
2/26/2008 -51.7% -41.5% 0
3/24/2008 -40.9% -36.8% 0
4/25/2008 -25.6% -31.0% 1
5/28/2008 -22.2% -33.6% 1
7/2/2008 -11.7% -25.3% 1
7/29/2008 -10.5% -20.9% 1
8/29/2008 -13.8% -17.9% 1
9/26/2008 -4.3% -10.0% 1
10/31/2008 18.7% 13.9% 1
11/26/2008 50.9% 27.7% 1
12/26/2008 48.9% 32.3% 1
1/23/2009 59.3% 36.4% 1
2/27/2009 92.8% 55.6% 1
3/27/2009 85.8% 48.1% 1
4/24/2009 69.7% 45.8% 1
5/29/2009 31.8% 22.8% 1
6/29/2009 21.3% 24.0% 0
7/29/2009 19.5% 15.9% 1
8/28/2009 7.4% 8.8% 0
9/25/2009 12.6% 12.4% 1
10/30/2009 22.7% 18.3% 1
11/27/2009 24.3% 13.6% 1
12/31/2009 23.7% 18.1% 1
1/22/2010 19.0% 20.6% 0
2/26/2010 18.6% 23.6% 0
3/25/2010 10.0% 15.4% 0
4/23/2010 7.1% 11.4% 0
5/28/2010 19.3% 25.4% 0
6/29/2010 16.7% 25.7% 0
7/29/2010 5.4% 20.1% 0
9/2/2010 7.3% 10.1% 0
9/24/2010 -4.3% 0.3% 0
10/29/2010 -2.9% 10.4% 0
11/26/2010 -8.5% 1.4% 0
1/3/2011 -11.4% 0.1% 0
1/28/2011 -7.6% 4.9% 0
2/25/2011 -5.5% 5.0% 0
3/24/2011 -4.4% 7.4% 0
4/21/2011 -16.0% 3.2% 0
5/27/2011 -12.0% -0.4% 0
6/24/2011 -9.5% 5.0% 0
7/29/2011 -4.3% 8.1% 0
8/26/2011 12.0% 21.6% 0
9/30/2011 23.5% 29.6% 0
10/28/2011 0.4% 11.5% 0
11/25/2011 13.9% 24.0% 0
12/29/2011 9.9% 15.9% 0
1/27/2012 7.4% 16.6% 0
2/24/2012 7.8% 13.3% 0
3/23/2012 9.1% 15.2% 0
4/27/2012 10.5% 15.3% 0
5/25/2012 26.5% 27.5% 0
6/22/2012 26.1% 24.6% 1
7/27/2012 30.4% 25.7% 1
8/24/2012 26.0% 19.8% 1
9/28/2012 39.3% 22.1% 1
10/26/2012 48.3% 28.9% 1
11/23/2012 45.7% 32.1% 1
12/31/2012 52.3% 33.0% 1
1/25/2013 39.5% 22.0% 1
2/22/2013 46.5% 26.4% 1
3/28/2013 40.1% 21.2% 1
4/26/2013 35.0% 20.5% 1
5/24/2013 20.4% 19.2% 1
6/28/2013 26.9% 24.1% 1
7/29/2013 17.8% 19.0% 0
8/30/2013 17.5% 24.6% 0
9/27/2013 12.9% 17.7% 0
10/25/2013 11.8% 15.4% 0
11/29/2013 12.3% 15.6% 0
12/31/2013 12.7% 11.9% 1
1/31/2014 14.2% 13.0% 1
2/28/2014 15.4% 13.9% 1
3/28/2014 6.1% 12.3% 0
4/25/2014 5.5% 12.2% 0
5/30/2014 6.4% 8.7% 0
6/27/2014 0.9% 6.2% 0
7/25/2014 3.9% 5.7% 0
8/29/2014 2.6% 3.9% 0
9/26/2014 9.4% 5.5% 1
10/31/2014 7.5% 3.3% 1
11/28/2014 2.3% 0.8% 1
12/31/2014 0.6% 0.9% 0
1/30/2015 3.0% 3.7% 0
2/27/2015 -2.8% -1.8% 0
Average 9.8% 9.2% 0

Subsets

I also have tracked 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.  I am going to try to add a third one , which I call "dogs".  It is like the dogs of the Dow in that you take the worst five performing stocks from the prior year that renew or all those that dropped more that 29%. The dividend portfolio was solid, up about 22.2%.  The new portfolio was just ok, up 9.5%. 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 today if you had spread $100,000 over the first twelve portfolios evenly.


Category Value
Total     187,963
Total Russell 3K     193,986
New     198,022
Dogs     280,551
Dividend     395,968

Current Dogs

Here are the five dogs going forward. It would take some courage to buy these names.

Stock  Initial Price   Mkt Cap 
UIS              23.00         1,143
RPXC              14.22           801
PFMT                3.34           165
NSR              24.15         1,330
LQDT                9.80           294
BCOR              14.00           572


Actually - I just noticed RPXC is an error, should be KING. I have fixed in my spreadsheet.

1 comment:

John Carney said...

Marsh,

Thanks for the new 3/28 Tracking Portfolio. This portfolio has four losing positions for the Simple Formula: GME, PDLI, COH, & RGR. If Mr Random gave you two COH and Two RGR you would have 20% of your portfolio losing about 14%.
Are you sure you want three GME going forward?
I guess you have back tested this but it still seems risky. Of course you would be buying them at different times. That might help a little.