Another month/year has flown by. And so it is time to look at another monthly tracking portfolio as we reach the end of September 2016. 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, MFI (wait for it) lost by 2 percentage points.. Technically, 18 of the past 19 have lost, although a few have been very close. Here are the 50 stocks in descending performance order:
| Stock | Initial Price | End Price | Percent Change | 52 week low | Mkt Cap |
| ONE | 2.94 | 5.15 | 75.2% | 1.85 | 141 |
| CPLA | 43.81 | 70.51 | 60.9% | 39.06 | 541 |
| AGX | 36.31 | 55.45 | 52.7% | 28.03 | 546 |
| IDCC | 49.96 | 69.45 | 39.0% | 41.01 | 1,801 |
| LBMH | 2.41 | 3.35 | 39.0% | 1.96 | 129 |
| HPQ | 26.98 | 36.26 | 34.4% | 8.91 | 48,555 |
| BCOR | 9.80 | 13.05 | 33.2% | 4.69 | 401 |
| KORS | 38.64 | 50.12 | 29.7% | 34.83 | 7,602 |
| DEPO | 17.50 | 22.45 | 28.3% | 12.25 | 1,055 |
| PPC | 17.00 | 21.64 | 27.3% | 18.42 | 4,924 |
| TIVO | 9.08 | 11.34 | 24.9% | 9.17 | 890 |
| PETS | 16.32 | 19.87 | 21.8% | 15.73 | 342 |
| KING | 14.96 | 18.00 | 20.3% | 12.00 | 4,709 |
| QCOM | 57.25 | 68.40 | 19.5% | 42.24 | 93,765 |
| APOL | 7.26 | 8.67 | 19.4% | 6.31 | 784 |
| MCFT | 9.56 | 11.20 | 17.2% | 10.25 | 227 |
| CLCT | 15.98 | 18.63 | 16.6% | 13.67 | 154 |
| BBY | 33.45 | 38.78 | 16.0% | 25.31 | 12,059 |
| VNCE | 4.55 | 5.25 | 15.4% | 3.49 | 167 |
| CA | 26.78 | 30.74 | 14.8% | 25.18 | 12,035 |
| MSB | 8.21 | 9.30 | 13.3% | 3.00 | 115 |
| FLR | 47.01 | 52.11 | 10.8% | 39.48 | 6,799 |
| CSCO | 27.88 | 30.59 | 9.7% | 22.46 | 146,702 |
| LQDT | 8.19 | 8.75 | 6.8% | 4.42 | 246 |
| STRA | 52.92 | 56.40 | 6.6% | 42.39 | 584 |
| DLX | 58.36 | 61.03 | 4.6% | 49.46 | 2,966 |
| SALE | 8.79 | 9.15 | 4.1% | 5.52 | 502 |
| AAPL | 117.00 | 113.72 | -2.8% | 89.47 | 666,661 |
| TDC | 28.11 | 26.95 | -4.1% | 21.98 | 3,980 |
| IILG | 17.10 | 16.33 | -4.5% | 10.61 | 1,014 |
| BBSI | 47.80 | 45.11 | -5.6% | 22.55 | 350 |
| PBI | 19.83 | 18.09 | -8.8% | 16.24 | 4,089 |
| OUTR | 57.71 | 52.00 | -9.9% | 24.81 | 1,035 |
| APEI | 21.73 | 19.50 | -10.3% | 13.80 | 360 |
| ENTA | 28.09 | 23.93 | -14.8% | 20.39 | 526 |
| NSR | 27.19 | 22.91 | -15.7% | 20.00 | 1,447 |
| IQNT | 19.97 | 16.42 | -17.8% | 14.56 | 699 |
| UTHR | 146.63 | 118.14 | -19.4% | 97.52 | 7,038 |
| VIAB | 47.63 | 37.60 | -21.1% | 30.11 | 19,620 |
| PDLI | 4.27 | 3.29 | -22.9% | 2.58 | 749 |
| VDSI | 19.01 | 13.91 | -26.8% | 12.35 | 752 |
| CALM | 52.18 | 38.16 | -26.9% | 36.45 | 2,593 |
| RPXC | 14.24 | 9.87 | -30.7% | 8.60 | 809 |
| VEC | 24.87 | 16.54 | -33.5% | 12.50 | 263 |
| AMAG | 40.00 | 25.90 | -35.3% | 17.92 | 1,235 |
| BKE | 32.89 | 20.95 | -36.3% | 20.60 | 1,720 |
| GME | 43.92 | 23.90 | -45.6% | 23.69 | 4,879 |
| ICON | 15.32 | 7.84 | -48.8% | 4.67 | 741 |
| LCI | 44.77 | 21.60 | -51.8% | 16.91 | 1,624 |
| NLNK | 38.27 | 12.36 | -67.7% | 9.23 | 1,243 |
Definitely a few trends here. AMAG, PDLI and LCI and NLNK are in pharma space. I have mentioned that a "Dogs of MFI" approach has shown some promise. GME, BKE, VEC, ICON, PDLI and VIAB are still on the list. It would take some courage to buy any of those - but I guess that is why they are called dogs. 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 | 8.6% | 15.8% | 0 |
| 5/30/2014 | 5.9% | 11.7% | 0 |
| 6/27/2014 | 2.5% | 9.2% | 0 |
| 7/25/2014 | 3.3% | 8.7% | 0 |
| 8/29/2014 | -2.2% | 1.0% | 0 |
| 9/26/2014 | -0.6% | -0.9% | 1 |
| 10/31/2014 | 4.3% | 4.4% | 0 |
| 11/28/2014 | -2.9% | 2.9% | 0 |
| 12/31/2014 | -9.3% | 0.3% | 0 |
| 1/30/2015 | -12.4% | -2.8% | 0 |
| 2/27/2015 | -19.0% | -7.3% | 0 |
| 3/27/2015 | -17.1% | -1.9% | 0 |
| 4/24/2015 | -15.4% | -0.8% | 0 |
| 5/29/2015 | -14.1% | 0.1% | 0 |
| 6/26/2015 | -8.7% | 0.4% | 0 |
| 7/30/2015 | 3.96% | 4.02% | 0 |
| 8/28/2015 | 5.6% | 10.2% | 0 |
| 9/25/2015 | 6.5% | 13.8% | 0 |
| 10/30/2015 | 2.0% | 4.0% | 0 |
| 11/27/2015 | 0.7% | 3.0% | 0 |
| 12/31/2015 | 4.2% | 5.6% | 0 |
| 1/29/2016 | 12.1% | 12.1% | 1 |
| 2/26/2016 | 10.3% | 11.2% | 0 |
| 3/24/2016 | 10.7% | 6.2% | 1 |
| 4/22/2016 | 0.2% | 2.7% | 0 |
| 5/27/2016 | 6.0% | 2.2% | 1 |
| 6/30/2016 | 3.9% | 2.0% | 1 |
| 7/29/2016 | -2.0% | -1.9% | 0 |
| 8/26/2016 | -3.0% | -1.9% | 0 |
| 9/30/2016 | -3.4% | -2.2% | 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 have added 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 ok, up about 3.5%. The Dogs portfolio was average, up 3.1%. The New approach was terrible, down 22% (a team effort of 4 stocks). 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.
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 have added 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 ok, up about 3.5%. The Dogs portfolio was average, up 3.1%. The New approach was terrible, down 22% (a team effort of 4 stocks). 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 | 177,826 |
| Total Russell 3K | 203,995 |
| New | 166,255 |
| Dogs | 223,354 |
| Dividend | 388,500 |
Posts
2 comments:
Unfortunately, it looks like the TrackJGreenblatt portfolio is not active anymore. The last 'trade' was October 2015 and then the selections/trades stop.
That is a shame.
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