Saturday, June 27, 2015

Weekend Update - June 26th, 2015

Weekend Update

Life is pretty good. Not sure if people here use Hulu, but I have a Hulu Plus subscription and they just added all the Seinfeld episodes.  They are still so funny to me and I didn't really start watching the series until season 3 or 4, so many of the early ones are new to me. I also finished book 5 of Game of Thrones series.  While I really enjoy the HBO series, the books (for me) take it to a whole new level.  Now I wait for book 6.

Week Overview

Well, we are essentially halfway through the year.  It has been a successful year for me in total, up 15.4%. Obviously NHTC is a big driver, up over 200%.   But my MFI formula portfolio has been solid, up 8%. This is actually quite good as 50% was in cash at start of year and is still 25% cash.  I have also been pretty successful in discretionary buys (ESI was outstanding as was RIG). But good to remain humble, I was way ahead of market at mid point last year as well. Then GTAT, GNW and oil slump decimated my portfolio. It can happen again.

Reading Barron's was interesting this weekend (I am not done yet).  They interviewed a bond trader who is convinced the Fed is likely to start raising rates in 2015.  He does not think the markets have priced this in and expects a lot of turmoil (he was talking about fixed income market, but I suspect same will be true for equities).  He also commented that a big change now are the numerous ETFs, many of which are liquid in of themselves, but trade in ill-liquid markets.   He expects many more flash crashes in the future.

MFI Select

These tranches continue to motor along.  June has seen them really, really stretch their lead over the benchmark.  I suspect in July, some of this will be given back as NHTC is defying gravity to some extent in my view.

8/15/2014 Start Current Dividend Pct Gain R3K Gain
CSCO $24.40 $28.28 $0.59 18.3% 9.6%
AGX $36.71 $39.94 $0.70 10.7% 9.6%
ITRN $21.32 $24.50 $0.87 19.0% 9.6%
BRCD $9.34 $12.24 $0.15 32.7% 9.6%
CBI $58.25 $52.62 $0.14 -9.4% 9.6%
Totals 14.3% 9.6%
11/15/2014 Start Current Dividend Pct Gain R3K Gain
FLR $64.80 $54.56 $0.63 -14.8% 5.1%
IPCM $38.45 $56.94 $0.00 48.1% 5.1%
VIAB $72.29 $66.43 $1.06 -6.6% 5.1%
NHTC $12.19 $42.01 $0.06 245.1% 5.1%
AWRE $4.40 $4.11 $0.00 -6.6% 5.1%
Totals 53.0% 5.1%
2/1/2015 Start Current Dividend Pct Gain R3K Gain
VEC $28.00 $25.21 $0.00 -10.0% 6.6%
QCOM $62.73 $64.67 $0.90 4.5% 6.6%
VIAB $63.91 $66.43 $0.73 5.1% 6.6%
UIS $22.03 $20.51 $0.00 -6.9% 6.6%
NHTC $12.44 $42.01 $0.05 238.1% 6.6%
Totals 46.2% 6.6%
5/6/2015 Start Current Dividend Pct Gain R3K Gain
CBI $50.38 $52.62 $0.00 4.4% 1.4%
PSDV $4.12 $3.81 $0.00 -7.6% 1.4%
TSRA $38.94 $38.26 $0.20 -1.2% 1.4%
KORS $62.24 $44.91 $0.00 -27.8% 1.4%
DEPO $23.50 $21.35 $0.00 -9.1% 1.4%
Totals -8.3% 1.4%
Category/Tranche August November February May Total
Initial Investment      25,000       25,000     25,000      25,000    100,000
Current Tranche 14.3% 53.0% 46.2% -8.3% 26.8%
Previous Tranche 41.4% 14.2% 8.5% 18.3% 19.5%
Tranche -2 14.1% 43.7% 78.3% 33.0% 42.3%
MFI Overall Gain 84.3% 151.2% 182.6% 44.3% 115.6%
Current Balance      46,078       62,798     70,644      36,072    215,592
R3K Current Tranche 9.6% 5.1% 6.6% 1.4% 5.7%
R3K Overall Gain 59.9% 64.5% 45.8% 36.0% 51.5%
R3K Balance      39,964       41,119     36,451      33,998    151,531
Annualized IRR 23.8% 42.2% 54.1% 18.7% 36.6%


It is looking more and more like the August tranche will be a winner.  AGX has really moved up nicely of late. CBI seems to spike up for a week or two and then falls back.  Looking at the table just above that has the summary, a 36.6% overall annual IRR is eye-popping.  A few more years of that I will be living high.

Date Differential MFI Value R3K Value
12/1/2012 -2.20%       99,765         101,965
1/1/2013 -1.78%      102,798         104,575
2/1/2013 -2.26%      102,594         104,856
3/1/2013 -2.23%      102,881         105,114
4/1/2013 -0.43%      106,804         107,234
5/1/2013 2.00%      110,423         108,423
6/1/2013 4.75%      115,831         111,085
7/1/2013 4.29%      114,888         110,597
8/1/2013 6.91%      124,799         117,889
9/1/2013 10.46%      124,536         114,079
10/1/2013 19.67%      138,655         118,990
11/1/2013 19.75%      143,514         123,764
12/1/2013 23.70%      150,105         126,405
1/1/2014 26.63%      157,138         130,503
2/1/2014 24.70%      150,619         125,918
3/1/2014 25.66%      158,116         132,458
4/1/2014 30.38%      162,991         132,616
5/1/2014 29.65%      162,428         132,779
6/1/2014 31.44%      167,001         135,559
7/1/2014 39.23%      177,971         138,740
8/1/2014 31.13%      167,054         135,922
9/1/2014 35.90%      177,792         141,892
10/1/2014 29.38%      168,321         138,944
11/1/2014 26.14%      168,810         142,666
12/1/2014 30.22%      176,420         146,198
1/1/2015 28.17%      174,306         146,140
2/1/2015 20.63%      162,833         142,201
3/1/2015 25.15%      175,476         150,324
4/1/2015 29.95%      178,565         148,612
5/1/2015 37.31%      186,655         149,348
6/1/2015 51.53%      202,897         151,371
Current 64.06%      215,592         151,531

Here you can see that if I had started with 100K spread over the 4 tranches in August 2012, I'd be at $215,592 now. Way ahead of benchmark.

MFI Formula

Exciting week.  Wednesday (or maybe Tuesday) I will be kicking off my fourth and final tranche.  As the title says, my picks will be formula driven.  It looks like if run today there are 15 or so names that will be put to the randomizer.

10/1/2014 Stocks Start Current Dividend Pct Gain R3K Gain
BAH $23.52 $26.05 $0.37 12.3% 9.1%
BKE $45.55 $46.99 $3.45 10.7% 9.1%
CA $27.87 $29.89 $0.75 9.9% 9.1%
GME $41.70 $44.04 $1.05 8.1% 9.1%
NUS $44.56 $48.50 $1.05 11.2% 9.1%
Totals 10.5% 9.1%
12/31/14 Stocks Start Current Dividend Pct Gain R3K Gain
CA $30.83 $29.89 $0.50 -1.4% 2.5%
CSCO $28.36 $28.28 $0.40 1.1% 2.5%
RGR $34.81 $57.15 $0.49 65.6% 2.5%
GME $34.21 $44.04 $0.72 30.8% 2.5%
IQNT $19.87 $18.90 $0.30 -3.4% 2.5%
Totals 18.5% 2.5%
3/31/2015 Start Current Dividend Pct Gain R3K Gain
HRB $31.99 $30.58 $0.20 -3.8% 1.3%
GME $37.69 $44.04 $0.36 17.8% 1.3%
KING $15.85 $14.08 $0.00 -11.2% 1.3%
NSU $3.43 $3.97 $0.00 15.7% 1.3%
PPC $22.65 $23.92 $0.00 5.6% 1.3%
Totals 4.8% 1.3%

So all three open tranches winning. The 12/31 tranche is especially outstanding.

Date Differential Value R3K Value
10/1/2014 0.00%      100,000         100,000
11/1/2014 1.63%      102,288         100,658
12/1/2014 0.30%      101,375         101,075
1/1/2015 -0.33%      100,664         100,995
2/1/2015 1.67%      101,281           99,611
3/1/2015 3.62%      106,073         102,454
4/1/2015 5.09%      106,781         101,695
5/1/2015 5.78%      107,859         102,077
6/1/2015 5.08%      108,213         103,134
Current 5.24%      108,453         103,218

You can see where the 100K has one.  Solid start, but still early days.

Gotta run, off to see Kinky Boots!  I know nothing about it (besides Cyndi Lauper writing the score.  Should be fun.


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