At the start of 2017, I commented that I planned to increase my total allocation to the MFI tranches. In part, this was because my tranches have done quite well (in aggregate) and in part I have some spare cash.
So January 1st, I bumped my 1/1/17 Formula tranche by 30% or so. I continued with my February 1st Select tranche, around 35%. Both those moves were good (thus far). My February tranche is already up 25% and my January tranche is up 5%.
But for my April 1st tranche, I got cold feet. Near the end of March, I got cold feet and liquidated some long time Dividend holdings and I put the kibosh on expanding my April tranche (which is essentially flat so far). You do not have to look very far to find very smart people become bearish and so I pulled back.
Not So Sure
I am now at all time high of cash. And I will likely remain relatively in that position. But I am less sure that the market is going to fall off anytime soon. There is a lot of cash out there and I just am not sure where it goes. Every dip is bought with ferocity.
So I think I will stay with my reduction in my dividend holdings, but I will recommence plans to increase MFI positions. I actually have some ideas I like for May 6th. Stay tuned.
Actually, after writing this - I decided it was not too late on the April 1st tranche as in aggregate it is down -0.2%. So I ended up with a 36% bump on those holdings. You will see next week a slight movement in individual purchase prices (as I averaged the two purchases), but in aggregate it is essentially no impact.
What Is Up With May?
It is strange. May has been my worst tranche in my Select approach. In total (since the reboot), it is up a composite 48% (May 2013 was the start). My other three quarters are up on average by 150%. And May is the only quarter of my Select tranches to be trailing the benchmark.
No fault of the current tranche, up 26% at this writing. But check out the previous May tranche (May 2015). It was terrible:
| 5/6/2015 | Start | Current | Dividend | Pct Gain | R3K Gain |
| CBI | $50.38 | $38.23 | $0.14 | -23.8% | -0.9% |
| PSDV | $4.12 | $2.87 | $0.00 | -30.4% | -0.9% |
| TSRA | $38.94 | $30.46 | $0.80 | -19.7% | -0.9% |
| KORS | $62.24 | $50.87 | $0.00 | -18.3% | -0.9% |
| DEPO | $23.50 | $15.51 | $0.00 | -34.0% | -0.9% |
| Totals | -25.2% | -0.9% |
You might wonder, "did these five stocks improve post selling"? A fair question as Greenblatt has stated the 1 year timeframe is rather arbitrary. The answer is no. Hard to believe, but these five stinkers are down another 20% since May 2016.
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