Nothing to do, nowhere to go this weekend. Going to be a little warm (around 90) but hey, it is mid-July. Have a little Count Basie on (Live at Newport, stellar album) and working on a French Roast. Life is pretty good.
The week was pretty volatile, but ended down a bit, but up 11.7% still on the year ==> strong. I did buy a few trading positions.
- I bought a second tranche of UCO at 35.49 this has not been a great trade for me but I am going to try and make it work.
- I bought BITI at 19.70. This is a bio tech company working on Alzheimer's. Seth Klarman bought a truckload at about the same price and it has generally worked well for me to align with him on those names.
- I bought AXS at $55.79. They are in a three-way love triangle trying to acquire PRE. This is essentially a bet they lose. In doing so, I think shareholders win as they get a substantial break-up fee and I think they are then in play to be acquired (with the recent Ace Chubb merger (Ace to Buy Chubb for $28.3 Billion) this space is ripe).
MFI Select
While NHTC tends to drive this portfolio (it has become out-sized and it volatile), everything else was pretty solid. I had great news on DEPO, which received a take-out offer from HZNP (Horizon Pharma Goes Hostile In Depomed Bid). That caused the stock to rocket up 44% on the week. I will also be watching PSDV with interest this week. The results of a Phase II study (pSivida Announces Top-Line Results from Investigator-Sponsored Phase II Study of Medidur™ for Uveitis to Be Reported Next Week) will be announced next week. The stock traded up 16% Thursday/Friday on 3x volume. Not sure if speculators or if someone knows something.
So my May tranche, which stumbled badly out of the gate, is starting to claw back into the race. Of course my August tranche has given up most of their lead. It will be very tight between now and August 15th to see if they win. CBI has been all over the place. But if they stay around $45, I will buy them back for new tranche.
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| $24.40 | $27.28 | $0.80 | 15.1% | 8.3% | |
| AGX | $36.71 | $39.97 | $0.70 | 10.8% | 8.3% |
| ITRN | $21.32 | $24.90 | $0.87 | 20.9% | 8.3% |
| $9.34 | $11.32 | $0.15 | 22.9% | 8.3% | |
| $58.25 | $46.45 | $0.21 | -19.9% | 8.3% | |
| Totals | 9.9% | 8.3% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| $64.80 | $50.74 | $0.63 | -20.7% | 3.8% | |
| IPCM | $38.45 | $55.41 | $0.00 | 44.1% | 3.8% |
| VIAB | $72.29 | $61.80 | $1.06 | -13.0% | 3.8% |
| NHTC | $12.19 | $37.57 | $0.06 | 208.7% | 3.8% |
| $4.40 | $4.00 | $0.00 | -9.1% | 3.8% | |
| Totals | 42.0% | 3.8% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| VEC | $28.00 | $24.13 | $0.00 | -13.8% | 5.3% |
| QCOM | $62.73 | $62.73 | $0.90 | 1.4% | 5.3% |
| VIAB | $63.91 | $61.80 | $0.73 | -2.2% | 5.3% |
| UIS | $22.03 | $20.02 | $0.00 | -9.1% | 5.3% |
| NHTC | $12.44 | $37.57 | $0.05 | 202.4% | 5.3% |
| Totals | 35.7% | 5.3% | |||
| 5/6/2015 | Start | Current | Dividend | Pct Gain | R3K Gain |
| CBI | $50.38 | $46.45 | $0.07 | -7.7% | 0.1% |
| PSDV | $4.12 | $4.08 | $0.00 | -1.1% | 0.1% |
| TSRA | $38.94 | $35.93 | $0.20 | -7.2% | 0.1% |
| KORS | $62.24 | $42.49 | $0.00 | -31.7% | 0.1% |
| DEPO | $23.50 | $30.14 | $0.00 | 28.3% | 0.1% |
| Totals | -3.9% | 0.1% | |||
| Category/Tranche | August | November | February | May | Total |
| Initial Investment | 25,000 | 25,000 | 25,000 | 25,000 | 100,000 |
| Current Tranche | 9.9% | 42.0% | 35.7% | -3.9% | 21.3% |
| Previous Tranche | 41.4% | 14.2% | 8.5% | 18.3% | 19.4% |
| Tranche -2 | 14.1% | 43.7% | 78.3% | 33.0% | 42.3% |
| MFI Overall Gain | 77.3% | 133.1% | 162.4% | 51.2% | 106.0% |
| Current Balance | 44,335 | 58,267 | 65,607 | 37,800 | 206,009 |
| R3K Current Tranche | 8.3% | 3.8% | 5.3% | 0.1% | 4.4% |
| R3K Overall Gain | 57.9% | 62.5% | 44.0% | 34.3% | 49.7% |
| R3K Balance | 39,487 | 40,627 | 36,012 | 33,587 | 149,713 |
| Annualized IRR | 21.8% | 37.6% | 48.5% | 20.9% | 33.3% |
So the MFI select approach continues to work quite well. Here are month by month movements:
| Date | Differential | MFI Value | R3K Value |
| -2.20% | 99,765 | 101,965 | |
| -1.78% | 102,798 | 104,575 | |
| -2.26% | 102,594 | 104,856 | |
| -2.23% | 102,881 | 105,114 | |
| -0.43% | 106,804 | 107,234 | |
| 2.00% | 110,423 | 108,423 | |
| 4.75% | 115,831 | 111,085 | |
| 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 |
| 24.70% | 150,619 | 125,918 | |
| 25.66% | 158,116 | 132,458 | |
| 30.38% | 162,991 | 132,616 | |
| 29.65% | 162,428 | 132,779 | |
| 31.44% | 167,001 | 135,559 | |
| 39.23% | 177,971 | 138,740 | |
| 31.13% | 167,054 | 135,922 | |
| 35.90% | 177,792 | 141,892 | |
| 29.38% | 168,321 | 138,944 | |
| 26.14% | 168,810 | 142,666 | |
| 30.22% | 176,420 | 146,198 | |
| 28.17% | 174,306 | 146,140 | |
| 20.63% | 162,833 | 142,201 | |
| 25.15% | 175,476 | 150,324 | |
| 29.95% | 178,565 | 148,612 | |
| 37.31% | 186,655 | 149,348 | |
| 51.53% | 202,897 | 151,371 | |
| 62.69% | 211,437 | 148,743 | |
| Current | 56.30% | 206,009 | 149,713 |
So you can see in July I have given some of lead back. That is largely because NHTC has dropped about 10%. I have started thinking a bit about August 15th new stocks. Just off top of my head: SNDK, KORS, CBI, VA and VEC all seem pretty cheap. But still a month to run.
MFI Formula
Now the formula approach, where I now have four tranches picked purely by formula (stocks from the screen over $600m market cap and 2.4% dividend). In total, the approach has been solid for me. GME and RGR have really helped.
| 10/1/2014 Stocks | Start | Current | Dividend | Pct Gain | R3K Gain |
| BAH | $23.52 | $25.94 | $0.37 | 11.8% | 7.8% |
| $45.55 | $46.27 | $3.45 | 9.2% | 7.8% | |
| CA | $27.87 | $30.34 | $0.75 | 11.5% | 7.8% |
| $41.70 | $46.96 | $1.05 | 15.1% | 7.8% | |
| $44.56 | $41.62 | $1.05 | -4.3% | 7.8% | |
| Totals | 8.7% | 7.8% | |||
| 12/31/14 Stocks | Start | Current | Dividend | Pct Gain | R3K Gain |
| CA | $30.83 | $30.34 | $0.50 | 0.0% | 1.3% |
| $28.36 | $27.28 | $0.61 | -1.7% | 1.3% | |
| $34.81 | $57.43 | $0.49 | 66.4% | 1.3% | |
| GME | $34.21 | $46.96 | $0.72 | 39.4% | 1.3% |
| IQNT | $19.87 | $17.76 | $0.30 | -9.1% | 1.3% |
| Totals | 19.0% | 1.3% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| $31.99 | $31.18 | $0.20 | -1.9% | 0.0% | |
| $37.69 | $46.96 | $0.36 | 25.6% | 0.0% | |
| KING | $15.85 | $14.68 | $0.00 | -7.4% | 0.0% |
| NSU | $3.43 | $3.55 | $0.04 | 4.7% | 0.0% |
| PPC | $22.65 | $22.59 | $0.00 | -0.3% | 0.0% |
| Totals | 4.1% | 0.0% | |||
| Start | Current | Dividend | Pct Gain | R3K Gain | |
| $46.45 | $46.27 | $0.00 | -0.4% | 0.1% | |
| CA | $29.34 | $30.34 | $0.00 | 3.4% | 0.1% |
| $44.42 | $44.61 | $0.00 | 0.4% | 0.1% | |
| $62.95 | $62.73 | $0.00 | -0.3% | 0.1% | |
| VIAB | $64.75 | $61.80 | $0.00 | -4.6% | 0.1% |
| Totals | -0.3% | 0.1% |
| Date | Differential | Value | R3K Value |
| 0.00% | 100,000 | 100,000 | |
| 1.63% | 102,288 | 100,658 | |
| 0.30% | 101,375 | 101,075 | |
| -0.33% | 100,664 | 100,995 | |
| 1.67% | 101,281 | 99,611 | |
| 3.62% | 106,073 | 102,454 | |
| 5.09% | 106,781 | 101,695 | |
| 5.78% | 107,859 | 102,077 | |
| 5.08% | 108,213 | 103,134 | |
| 4.82% | 106,423 | 101,604 | |
| Current | 5.58% | 107,847 | 102,268 |
MFI Index
I haven't commented on my MFI Index recently. As a reminder, I create this index at the start of each year (back to 2006). It is very simply the top 50 stocks over $100m at the start of each year held for a year.
| Annual | Inception to Date | |||
| Year | Russell | Russell ITD | MFI ITD | |
| 2006 | 11.40% | 15.03% | 11.40% | 15.03% |
| 2007 | 4.09% | -6.69% | 15.96% | 7.34% |
| 2008 | -37.05% | -37.97% | -27.00% | -33.42% |
| 2009 | 32.51% | 45.18% | -3.27% | -3.34% |
| 2010 | 18.38% | 22.77% | 14.50% | 18.67% |
| 2011 | -0.56% | -10.47% | 13.87% | 6.25% |
| 2012 | 16.43% | 9.70% | 32.57% | 16.56% |
| 2013 | 33.01% | 51.70% | 76.34% | 76.82% |
| 2014 | 12.26% | 12.07% | 97.95% | 98.15% |
| 2015 | 2.46% | 3.86% | 100.36% | 101.94% |
As you can see, since the start it is pretty much a dead heat: +100.36% versus +101.94%. Winning by a bit more than a percentage point this year at +3.8%. GARIX, which is a long short MFI fund is down by 6% for the year. But the out performance is driven by just several names.
| Stock | Start | 30-Jun | Current | YTD Change | Q3 Change |
| ADMS | 17.37 | 26.22 | 27.41 | 57.8% | 4.5% |
| AFOP | 14.51 | 18.55 | 19.96 | 37.6% | 7.6% |
| ANIK | 40.74 | 33.03 | 33.33 | -18.2% | 0.9% |
| APOL | 34.11 | 12.88 | 14.01 | -58.9% | 8.8% |
| AGX | 33.64 | 40.33 | 39.97 | 18.8% | -0.9% |
| AVID | 14.21 | 13.34 | 13.38 | -5.8% | 0.3% |
| AWRE | 4.54 | 4.03 | 4.00 | -11.9% | -0.7% |
| BCOR | 13.85 | 16.15 | 15.74 | 13.6% | -2.5% |
| BKE | 52.52 | 49.00 | 49.50 | -5.8% | 1.0% |
| CA | 30.45 | 29.79 | 30.84 | 1.3% | 3.5% |
| CSCO | 27.82 | 27.86 | 27.89 | 0.3% | 0.1% |
| COH | 37.56 | 34.95 | 33.72 | -10.2% | -3.5% |
| DLX | 62.25 | 62.60 | 61.44 | -1.3% | -1.9% |
| DEPO | 16.11 | 21.46 | 30.14 | 87.1% | 40.4% |
| EBIX | 16.99 | 32.69 | 32.67 | 92.3% | -0.1% |
| FLR | 60.63 | 53.43 | 51.16 | -15.6% | -4.2% |
| GME | 33.80 | 43.68 | 47.68 | 41.1% | 9.2% |
| GORO | 3.38 | 2.82 | 2.55 | -24.6% | -9.6% |
| ONE | 4.21 | 2.99 | 2.80 | -33.5% | -6.4% |
| IQNT | 19.63 | 18.55 | 17.91 | -8.8% | -3.5% |
| IDCC | 52.90 | 57.29 | 55.90 | 5.7% | -2.4% |
| IILG | 20.89 | 23.09 | 22.57 | 8.0% | -2.3% |
| ITRN | 22.04 | 25.26 | 25.23 | 14.5% | -0.1% |
| KING | 15.36 | 15.19 | 15.62 | 1.7% | 2.8% |
| LCI | 42.88 | 59.44 | 59.93 | 39.8% | 0.8% |
| LFVN | 1.30 | 0.53 | 0.54 | -58.5% | 1.9% |
| LQDT | 8.17 | 9.63 | 9.35 | 14.4% | -2.9% |
| MSB | 17.28 | 14.24 | 13.04 | -24.5% | -8.4% |
| NHTC | 11.45 | 41.51 | 37.62 | 228.6% | -9.4% |
| NSR | 27.80 | 29.21 | 29.01 | 4.4% | -0.7% |
| NUS | 43.70 | 47.83 | 42.32 | -3.2% | -11.5% |
| PDLI | 7.71 | 6.58 | 6.45 | -16.3% | 0.0% |
| PFMT | 6.65 | 3.24 | 3.15 | -52.6% | -2.8% |
| PETS | 14.37 | 17.44 | 18.17 | 26.4% | 4.2% |
| PBI | 24.37 | 21.19 | 21.46 | -12.0% | 1.3% |
| RPXC | 13.78 | 16.90 | 16.30 | 18.3% | -3.6% |
| SPOK | 17.36 | 17.09 | 16.67 | -4.0% | -2.5% |
| STRA | 74.28 | 43.10 | 45.69 | -38.5% | 6.0% |
| RGR | 34.63 | 57.94 | 57.92 | 67.3% | 0.0% |
| TTWO | 28.03 | 27.57 | 28.26 | 0.8% | 2.5% |
| TDC | 43.68 | 37.00 | 35.93 | -17.7% | -2.9% |
| TZOO | 12.62 | 11.28 | 11.95 | -5.3% | 5.9% |
| TPUB | 22.90 | 15.72 | 16.19 | -29.3% | 3.0% |
| UBNT | 29.64 | 31.92 | 32.88 | 10.9% | 3.0% |
| UIS | 29.48 | 19.99 | 20.02 | -32.1% | 0.2% |
| USNA | 102.59 | 136.66 | 135.16 | 31.7% | -1.1% |
| VEC | 27.40 | 24.87 | 24.13 | -11.9% | -3.0% |
| VIAB | 75.25 | 64.97 | 62.13 | -17.4% | -4.4% |
| WTW | 24.84 | 4.85 | 3.97 | -84.0% | -18.1% |
| WILN | 2.99 | 2.40 | 2.17 | -27.4% | -9.6% |
| Total | 19,816 | 20,600 | 20,580 | 3.9% | -0.1% |
Dividends
Monday is s strange day. I have four stocks (FSC, BKE, REXI and NTC) going x-dividend. I acn't really explain it but I get great satisfaction of a stock/security going x-dividend. It is income. It is tangible. If I reinvest (which I do with FSC and NTC), then my share count goes up. And then I eventually get dividends on dividends. Here is a table, using my multiplier of dividends on dividends I have gotten:
| Row Labels | Sum of Cost | Sum of Value | Sum of Dividends | Sum of Gain | Sum of Shares |
| CSQ | 21,084 | 21,761 | 3,113 | 3,791 | 1,987 |
| AOD | 19,331 | 19,658 | 1,684 | 2,011 | 2,265 |
| 9,461 | 8,978 | 1,917 | 1,434 | 1,559 | |
| O | 6,197 | 7,860 | 1,063 | 2,726 | 170 |
| NTC | 6,345 | 6,318 | 214 | 186 | 505 |
| FSC | 4,140 | 3,907 | 52 | -181 | 597 |
| Grand Total | 66,558 | 68,481 | 8,044 | 9,967 | 7,083 |
So the way to read this is for CSQ I have received $21,084 of dividends. They have all been reinvested and are now worth $21,761. And they have generated an additional $3,113 of dividends. In total I have added 1,987 shares with the reinvested dividends.
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1 comment:
Marsh,
My MFI formula is +11.2% for tranche #1, +2.9% for #2, -5.5% for #3, and -1.0% for #4. My total is at $101,552 or +1.5% a little under the index at +2.1%. This includes dividends for my 20 stocks and also for the index.
It is early but I am not beating the index. It is not working for me. I am jealous. I was running neck and neck with you until May 1st.
The only good news is my MFI Formula PAPER trades are up +3.2% over the index with 22 stocks. I bought 13 at one time and added the rest at about 2 per month. The 22 were sold at the end of one year.
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