I think this week deserves a quote:
"It is hard to recognize good luck. It looks so much like something you've earned!"
I did get lucky this week with a few stocks, although I'd prefer to say it was my conviction. But even with some luck, I ended up right on par with my benchmarks for the week... so perhaps I was lucky I was lucky.
It was a great week for the markets. The Russell 3000 climbed 2.5%. I know technical people were saying we tested the 200 dma and then bounced, so I guess that was a "buy" signal. Again, I don't use technical analysis... but if enough investors believe in something - you should at least be aware.
Welcome to the occasionally amusing MFI Diary. This is a diary I have been maintaining since February 2006 (damn, that is a long time) tracking my "experiences" in investing real money in the methods discussed in "The Little Book That Beats The Markets". I also spend some time discussing my MFI (Magic Formula Investing) Index and various MFI tracking portfolios that I have created over time.
I did create a guide recently for new readers to my blog that point you to some fascinating/interesting posts. I encourage you to give it a whirl (Guide To New Readers). (PS - I continue to struggle to make this link work. You can instead go to Blog archive on left margin of this blog and you will find a link in October 2017). Of course, I have to have a disclaimer - I am just a non-economist, non-CFA with a spreadsheet and not a stock advisor (pretty clear as I ended 1st quarter in the red overall). You should do your own due diligence before acting on anything you read here.And as a free bonus, I also discuss how my non-MFI investments are doing (generally poorly) in 2nd half of my blog.
Onwards.
Last Week
Got the Doobie Brothers on this morning. Minute by Minute. Crazy week and it ended up decently, but steady with the benchmarks. Perhaps I have too many stocks to really vary that far from the benchmark. I also did finally watch "The Last Jedi", and it was surprisingly good. Had a few unexpected twists and I had to rewatch the ending.
The week was certainly upside down (cue Hamilton) as my MFI portfolios struggled (again), while my dividend and miscellaneous portfolios were quite satisfactory.
| Component | YTD | 2nd Quarter | Week Change |
| Overall | -0.1% | +2.9% | +1.6% |
| MFI Select | -4.1% | -5.8% | +0.3% |
| MFI Formula | +4.2% | +2.9% | +0.9% |
| MFI Combined | -0.1% | -1.6% | +0.6% |
| Miscellaneous | -1.4% | +8.9% | +3.6% |
| Dividend | +0.5% | +3.7% | +1.5% |
| Dividend Index | -2.4% | +1.3% | +0.5% |
| R3K Index | +2.8% | +3.5% | +2.5% |
| Blended Index | +0.4% | +2.5% | +1.6% |
| MFI Index | +11.1% | +4.0% | +2.2% |
| GARIX | -0.2% | -0.3% | +1.6% |
So you can see that my two MFI portfolios (Select and Formula) pretty much wash each other out and MFI Combined is now down 0.1% on the year. You just have stretches like this. Though my MFI Index is now up 11.1% on the year. Solid.
But the real story is my Misc portfolio is up 8.9% in Q2 and is now just down 1.4% for the year. And my dividend portfolio is back in the green, even while the benchmark dividend index is down 2.4% for the year. Finally, overall I am down 0.1% for the year now while the blended index (my overall benchmark) is up 0.4%.
I know, hardly seems worth the effort. But hey, I am retired and need something to keep me occupied.
MFI Select
I have two real money MFI portfolios, Select and Formula. Each consists of 4 tranches and each tranche has 5 stocks. I started Select in August 2012, after quitting MFI for a year. It has done quite well overall... but you always have a few bumps in the road and it seems I am knee-deep in a bump right now. Here's how the stocks fared this past week (down 5.8% in the 2nd quarter):
| Stock | Last Week | Current | Dividend | Change |
| ICHR | 23.74 | 26.02 | - | 9.6% |
| SIMO | 45.36 | 48.26 | - | 6.4% |
| CASA | 22.75 | 20.02 | - | -12.0% |
| MSGN | 19.20 | 19.20 | - | 0.0% |
| VIAB | 30.29 | 30.22 | - | -0.2% |
| DISCA | 23.16 | 24.03 | - | 3.8% |
| AGX | 38.40 | 38.15 | - | -0.7% |
| KLAC | 106.66 | 111.07 | - | 4.1% |
| FTSI | 19.20 | 19.25 | - | 0.3% |
| CAAP | 11.27 | 10.72 | - | -4.9% |
| WDC | 77.28 | 78.80 | - | 2.0% |
| TGNA | 10.38 | 10.66 | - | 2.7% |
| RHI | 62.05 | 63.15 | - | 1.8% |
| THO | 106.06 | 96.04 | - | -9.4% |
| CELG | 86.89 | 84.54 | - | -2.7% |
| EVC | 4.75 | 4.15 | - | -12.6% |
| MD | 45.22 | 46.09 | - | 1.9% |
| GHC | 599.25 | 601.60 | - | 0.4% |
ICHR had good earnings and popped 9.6%... which is good as it is my largest Select holding. But CASA had poor earnings and dropped 12%... it had gone up way too fast and has now dropped 31% in Q2 (ouch). THO has been a disaster pick and EVC had poor earnings (again) and is now down a staggering 41% in 2018. It ain't always easy.
Here are the 4 open tranches... probably best for the younger readers to avert their eyes:
| 8/15/2017 | Start | Current | Dividend | Pct Gain | R3K Gain |
| GHC | $591.10 | $601.60 | $3.81 | 2.4% | 12.6% |
| ICHR | $19.80 | $26.02 | $0.00 | 31.4% | 12.6% |
| MD | $43.00 | $46.09 | $0.00 | 7.2% | 12.6% |
| SIMO | $43.05 | $48.26 | $0.60 | 13.5% | 12.6% |
| RHI | $44.15 | $63.15 | $0.76 | 44.8% | 12.6% |
| Totals | 19.9% | 12.6% | |||
| 11/15/2017 | Start | Current | Dividend | Pct Gain | R3K Gain |
| MSGN | $16.67 | $19.20 | $0.00 | 15.2% | 7.4% |
| CELG | $100.60 | $84.54 | $0.00 | -16.0% | 7.4% |
| EVC | $5.78 | $4.15 | $0.10 | -26.5% | 7.4% |
| SIMO | $46.88 | $48.26 | $0.30 | 3.6% | 7.4% |
| VIAB | $24.41 | $30.22 | $0.40 | 25.5% | 7.4% |
| Totals | 0.4% | 7.4% | |||
| 2/1/2018 | Start | Current | Dividend | Pct Gain | R3K Gain |
| AGX | $43.55 | $38.15 | $0.25 | -11.8% | -2.2% |
| CASA | $18.81 | $20.02 | $0.00 | 6.4% | -2.2% |
| KLAC | $109.80 | $111.07 | $0.59 | 1.7% | -2.2% |
| THO | $136.33 | $96.04 | $0.37 | -29.3% | -2.2% |
| WDC | $87.74 | $78.80 | $0.50 | -9.6% | -2.2% |
| Totals | -8.5% | -2.2% | |||
| 5/2/2018 | Start | Current | Dividend | Pct Gain | R3K Gain |
| CAAP | $12.19 | $10.72 | $0.00 | -12.1% | 3.8% |
| TGNA | $10.51 | $10.66 | $0.00 | 1.5% | 3.8% |
| DISCA | $23.85 | $24.03 | $0.00 | 0.8% | 3.8% |
| FTSI | $19.39 | $19.25 | $0.00 | -0.7% | 3.8% |
| ICHR | $21.96 | $26.02 | $0.00 | 18.5% | 3.8% |
| Totals | 1.6% | 3.8% |
Just one of the four is winning. CAAP in my May tranche has been crushed by Argentinian issues... but I have faith we'll move past that, at some point.
Here is overall summary:
| Category/Tranche | August | November | February | May | Total |
| Initial Investment | 25,000 | 25,000 | 25,000 | 25,000 | 100,000 |
| Current Tranche | 19.9% | 0.4% | -8.5% | 1.6% | 1.4% |
| Previous Tranche | -0.1% | 42.6% | 74.9% | -3.6% | 27.9% |
| Tranche -2 | 2.8% | 8.0% | 10.7% | 19.1% | 10.2% |
| Tranche -3 | 11.2% | 69.4% | -14.3% | -25.2% | 10.3% |
| Tranche -4 | 41.4% | 14.2% | 8.5% | 18.3% | 20.6% |
| Tranche -5 | 14.1% | 43.7% | 78.3% | 33.0% | 42.3% |
| MFI Overall Gain | 120.9% | 330.2% | 193.7% | 37.3% | 170.5% |
| Current Balance | 55,228 | 107,547 | 73,415 | 34,313 | 270,503 |
| R3K Current Tranche | 12.6% | 7.4% | -2.2% | 3.8% | 5.4% |
| R3K Overall Gain | 115.7% | 120.1% | 97.3% | 84.7% | 104.4% |
| R3K Balance | 53,919 | 55,016 | 49,330 | 46,167 | 204,431 |
| Annualized IRR | 14.8% | 30.4% | 22.7% | 6.5% | 18.6% |
Yes, you're reading the table correctly. My 4 open tranches are up an aggregate 1.4%. Pretty bad when you look at all my closed tranches in total just under the 1.4%... 27.9%, 10.2%, 10.3%, 20.6% and 42.3%. Doesn't help that markets are largely trading sideways in 2018... and I've had a few bonehead picks (so far).
Here is how $100,000 at the start (August 2012) would have grown:
| Date | Differential | MFI Value | R3K Value |
| 1/1/2013 | -1.78% | 102,798 | 104,575 |
| 4/1/2013 | -0.43% | 106,804 | 107,234 |
| 7/1/2013 | 4.29% | 114,888 | 110,597 |
| 10/1/2013 | 19.67% | 138,655 | 118,990 |
| 1/1/2014 | 26.63% | 157,138 | 130,503 |
| 4/1/2014 | 30.38% | 162,991 | 132,616 |
| 7/1/2014 | 39.23% | 177,971 | 138,740 |
| 10/1/2014 | 29.38% | 168,321 | 138,944 |
| 1/1/2015 | 28.17% | 174,306 | 146,140 |
| 4/1/2015 | 29.95% | 178,565 | 148,612 |
| 7/1/2015 | 62.69% | 211,437 | 148,743 |
| 10/1/2015 | 43.12% | 181,175 | 138,052 |
| 1/1/2016 | 63.33% | 209,514 | 146,186 |
| 4/1/2016 | 47.34% | 195,770 | 148,430 |
| 7/1/2016 | 50.41% | 201,092 | 150,680 |
| 10/1/2016 | 42.98% | 198,563 | 155,582 |
| 1/1/2017 | 45.60% | 209,503 | 163,936 |
| 4/1/2017 | 55.70% | 229,473 | 173,735 |
| 7/1/2017 | 60.28% | 239,060 | 178,782 |
| 10/1/2017 | 75.60% | 262,489 | 186,886 |
| 1/1/2018 | 92.19% | 291,114 | 198,926 |
| 4/1/2018 | 96.21% | 293,665 | 197,451 |
| Current | 66.07% | 270,503 | 204,431 |
Still nice growth and a solid shellacking of benchmark. But also bit of freefall since 4/1. It happens.
MFI Formula
My 2nd real money MFI approach is called "Formula" as I use a formula combined with a random number generator to pick all my stocks. Yes, it is a bit frightening. But, I am not sure I add value when I bring my biases to the table. I started MFI Formula in October 2014.
Same tables:
| Stock | Last Week | Current | Dividend | Change |
| GILD | 65.42 | 66.16 | - | 1.1% |
| AMGN | 167.98 | 173.89 | - | 3.5% |
| OMC | 74.58 | 75.08 | - | 0.7% |
| GME | 13.00 | 12.71 | - | -2.2% |
| HPQ | 21.68 | 22.71 | - | 4.8% |
| VIAB | 30.29 | 30.22 | - | -0.2% |
| EGOV | 15.45 | 15.50 | - | 0.3% |
| TUP | 44.27 | 43.24 | - | -2.3% |
| DIN | 77.54 | 74.98 | - | -3.3% |
| SYNT | 29.35 | 30.07 | - | 2.5% |
| HRB | 27.49 | 27.85 | - | 1.3% |
| CSCO | 45.30 | 45.93 | - | 1.4% |
| RGR | 58.10 | 61.00 | - | 5.0% |
Well, definitely a better week than Select. RGR had good earnings. GME had been starting to bounce off lows, but their CEO abruptly left this week. He had only been there a few months. Could be good, could be bad.
| 7/1/2017 | Start | Current | Dividend | Pct Gain | R3K Gain |
| CSCO | $30.98 | $45.93 | $0.91 | 51.2% | 14.2% |
| GME | $20.95 | $12.71 | $1.14 | -33.9% | 14.2% |
| HPQ | $17.60 | $22.71 | $0.40 | 31.3% | 14.2% |
| RGR | $60.70 | $61.00 | $0.67 | 1.6% | 14.2% |
| SYNT | $16.21 | $30.07 | $0.00 | 85.5% | 14.2% |
| Totals | 27.1% | 14.2% | |||
| 10/1/2017 | Start | Current | Dividend | Pct Gain | R3K Gain |
| DIN | $43.14 | $74.98 | $1.60 | 77.5% | 9.3% |
| GILD | $82.85 | $66.16 | $1.09 | -18.8% | 9.3% |
| GME | $20.50 | $12.71 | $0.76 | -34.3% | 9.3% |
| HPQ | $20.22 | $22.71 | $0.27 | 13.6% | 9.3% |
| OMC | $74.80 | $75.08 | $1.15 | 1.9% | 9.3% |
| Totals | 8.0% | 9.3% | |||
| 1/2/2018 | Start | Current | Dividend | Pct Gain | R3K Gain |
| AMGN | $177.11 | $173.89 | $1.32 | -1.1% | 2.2% |
| GME | $18.06 | $12.71 | $0.38 | -27.5% | 2.2% |
| GILD | $71.64 | $66.16 | $0.57 | -6.9% | 2.2% |
| HRB | $26.34 | $27.85 | $0.24 | 6.6% | 2.2% |
| OMC | $72.81 | $75.08 | $0.60 | 3.9% | 2.2% |
| Totals | -5.0% | 2.2% | |||
| 4/3/2018 | Start | Current | Dividend | Pct Gain | R3K Gain |
| AMGN | $166.46 | $173.89 | $0.00 | 4.5% | 5.6% |
| VIAB | $29.20 | $30.22 | $0.00 | 3.5% | 5.6% |
| GILD | $72.71 | $66.16 | $0.00 | -9.0% | 5.6% |
| TUP | $47.32 | $43.24 | $0.00 | -8.6% | 5.6% |
| EGOV | $13.29 | $15.50 | $0.00 | 16.7% | 5.6% |
| Totals | 1.4% | 5.6% |
Hmmm, guess just one of four leading here as well. But the one that is leading (July) is leading by a lot (13 points).
| Category/Tranche | October | January | April | July | Total |
| Initial Investment | 249,820 | 249,939 | 250,180 | 249,728 | 999,667 |
| Current Tranche | 8.0% | -5.0% | 1.4% | 27.1% | 6.5% |
| Previous Tranche | 7.0% | 16.5% | 21.3% | 26.7% | 17.8% |
| Tranche -2 | 5.5% | 9.3% | 25.2% | -12.5% | 6.9% |
| Tranche -3 | 0.5% | 11.0% | -0.2% | 0.0% | 2.8% |
| MFI Overall Gain | 22.5% | 34.3% | 53.6% | 41.0% | 37.8% |
| Current Balance | 305,922 | 335,672 | 384,283 | 352,120 | 1,377,997 |
| R3K Current Tranche | 9.3% | 2.2% | 5.6% | 14.2% | 7.8% |
| R3K Overall Gain | 46.6% | 37.9% | 36.8% | 32.9% | 38.6% |
| R3K Balance | 366,345 | 344,599 | 342,271 | 331,968 | 1,385,183 |
| Annualized IRR | 5.8% | 9.2% | 14.8% | 12.7% | 10.6% |
So my 4 open tranches are up 6.5% vs 7.8% for Russell 3000. Never easy. Here is how $100,000 on October 1st, 2014 would have grown:
| Date | Differential | Value | R3K Value |
| 10/1/2014 | 0.00% | 100,000 | 100,000 |
| 1/1/2015 | -0.33% | 100,664 | 100,995 |
| 4/1/2015 | 5.09% | 106,781 | 101,695 |
| 7/1/2015 | 4.82% | 106,423 | 101,604 |
| 10/1/2015 | 6.39% | 100,703 | 94,312 |
| 1/1/2016 | -3.36% | 96,830 | 100,012 |
| 4/1/2016 | 0.34% | 102,371 | 101,548 |
| 7/1/2016 | -0.19% | 103,022 | 103,216 |
| 10/1/2016 | -0.85% | 106,377 | 107,230 |
| 1/1/2017 | 1.57% | 113,406 | 111,832 |
| 4/1/2017 | -1.86% | 116,227 | 118,091 |
| 7/1/2017 | -2.40% | 119,144 | 121,545 |
| 10/1/2017 | -2.56% | 124,448 | 127,007 |
| 1/1/2018 | -3.63% | 131,460 | 135,086 |
| 4/1/2018 | -0.16% | 133,734 | 133,898 |
| Current | -0.72% | 137,800 | 138,519 |
Seems like just yesterday I had the lead... but now a virtual dead heat. It is a grind, it makes you wonder is the magic formula still magical? Or are value stocks still largely out of favor?
Ok, for those who came to read about MFI - c'est fini.
Dividend Portfolio
This is actually my largest pot of money. We are retired, so we have goal of generating a steady income stream. Therefore, my focus is not on capital gains so much, but rather steady income. I know that this is a challenged area when interest rates are rising. I have tried (given my feeble financial knowledge) to pick some securities that would not get crushed by rising rates... but I suppose correlation can go to 1.00 if things are stressed.
I did see where one of my picks (OCSI) dropped their dividend from 19 cents to 14 cents. Gnashing of teeth. Here are my holdings:
| Dividend Stocks | Start | Current | Divvy | Overall Pct Gain | Weekly Pct Gain | 12/30/17 Price | Yield | 2018 | Adj 2018 |
| TK | 7.43 | 8.89 | 0.13 | 21.3% | -0.8% | 9.32 | 2.5% | -4.6% | 2.1% |
| OIBAX | 5.91 | 5.82 | 0.27 | 3.0% | -0.2% | 5.96 | 4.5% | -2.3% | -2.4% |
| LADR | 13.35 | 14.90 | 0.61 | 16.1% | 4.8% | 13.63 | 8.5% | 9.3% | 8.3% |
| KCLI | 48.14 | 41.00 | 0.79 | -13.2% | 0.6% | 45.25 | 2.6% | -9.4% | -8.9% |
| NS | 29.41 | 21.71 | 1.51 | -21.0% | 3.9% | 29.95 | 11.1% | -27.5% | -15.1% |
| CPLP | 3.50 | 3.13 | 0.22 | -4.4% | 1.6% | 3.36 | 10.2% | -6.8% | -6.5% |
| AMID | 11.87 | 10.35 | 0.59 | -7.8% | 4.0% | 13.35 | 15.9% | -22.5% | -13.1% |
| TGP | 18.28 | 17.75 | 0.28 | -1.3% | 0.0% | 20.15 | 3.2% | -11.9% | -11.5% |
| GLOP-PB | 25.36 | 26.09 | 0.33 | 4.2% | 0.9% | 25.36 | 8.0% | 2.9% | 2.9% |
| KNOP | 21.30 | 20.15 | 1.04 | -0.5% | -0.5% | 20.75 | 10.3% | -2.9% | -2.9% |
| JQC | 8.18 | 8.10 | 0.80 | 8.8% | -0.2% | 8.22 | 6.1% | -1.5% | -1.5% |
| ISBC | 13.33 | 13.47 | 0.26 | 3.0% | -0.1% | 13.88 | 2.7% | -3.0% | -3.0% |
| PSXP | 47.39 | 49.53 | 2.42 | 9.6% | 0.9% | 52.35 | 5.8% | -5.4% | -5.4% |
| EVG | 14.46 | 13.42 | 0.64 | -2.8% | 0.8% | 14.35 | 6.8% | -6.5% | -6.5% |
| FDEU | 18.40 | 17.59 | 1.30 | 2.7% | 0.5% | 18.83 | 8.3% | -6.6% | -6.6% |
| NRZ | 16.56 | 17.98 | 1.67 | 18.6% | 0.2% | 17.88 | 11.1% | 0.6% | 0.6% |
| SBRA | 22.15 | 20.16 | 0.62 | -6.2% | 4.9% | 18.77 | 8.9% | 7.4% | 7.6% |
| DSL | 19.47 | 20.33 | 2.44 | 17.0% | -0.3% | 20.19 | 8.9% | 0.7% | 0.7% |
| OCSI | 8.68 | 8.48 | 0.52 | 3.7% | 3.7% | 8.40 | 6.8% | 1.0% | 1.0% |
| TGONF | 11.04 | 12.54 | 2.14 | 33.0% | -0.1% | 13.30 | 5.7% | -5.7% | -5.7% |
| TOO | 2.33 | 2.84 | 0.02 | 22.5% | 4.4% | 2.36 | 1.4% | 20.3% | 17.6% |
| DDR | 7.07 | 7.49 | - | 5.9% | 3.3% | 7.00 | 10.1% | 7.0% | 7.0% |
| O | 26.04 | 52.99 | 21.44 | 185.8% | 1.4% | 57.02 | 5.0% | -7.1% | -6.9% |
| Totals | 4.1% | 1.3% | 6.8% | 0.5% |
Hopefully all the columns come across... for some reason "adjusted" got truncated last week. Again, "2018" just shows the change in price during 2018, while adjusted 2018 reflects the fact that I have lowered my basis on several securities in 2018 by adding to my shares (like NS and AMID). I pretty much did nothing to this portfolio this past week. Did collect a bunch of dividends!
You can see TOO and LADR have been my best performers in 2018. SBRA also made a nice move this week on good earnings and some restructuring with a major tenant.
I also have a basket of small banks as part of this portfolio. They have done reasonably well. I keep expecting them to go higher due to benefiting from lower tax rates and possible M&A. But still, slow and steady isn't bad.
| Bank | Start | Current | Dividends | Change | 2018 Change | Yield |
| ACBI | 16.99 | 20.10 | - | 18.3% | 14.2% | 0.0% |
| ASB | 25.69 | 27.10 | 0.15 | 6.1% | 6.7% | 2.3% |
| FBIZ | 23.69 | 25.81 | 0.28 | 10.2% | 16.7% | 2.2% |
| FULT | 18.81 | 17.45 | 0.23 | -6.0% | -2.5% | 2.7% |
| FNB | 14.47 | 13.39 | 0.12 | -6.6% | -3.1% | 3.7% |
| MSBI | 32.96 | 31.85 | 0.22 | -2.7% | -1.9% | 2.8% |
| NRIM | 37.47 | 37.65 | 0.45 | 1.7% | 11.2% | 2.7% |
| PACW | 48.30 | 53.38 | 0.50 | 11.6% | 5.9% | 4.5% |
| SONA | 17.13 | 16.84 | 0.16 | -0.7% | 5.1% | 2.1% |
| WNEB | 10.88 | 11.00 | 0.08 | 1.8% | 0.9% | 1.5% |
| Total | 3.4% | 5.3% | 2.4% |
Yeah, a lot of people would be pretty happy with +5.3% in 2018. I won't publish it today, but the 40 holdings in the Barron's dividend index I created are down 2.4% in 2018.
MIscellaneous
I mentioned I had a good week here (although my smallest $ portfolio). It was up 3.6%. This is my highest risk portfolio and I do trade regularly here, unlike my other portfolios. I was actually starting to beat myself up at the start of this week, wondering if my trading "costs" me. I went back to my holdings at the start of the year and I saw how I would have done if I hadn't bought or sold a single stock. I would actually be doing worse. That made me feel better... it is easy to remember stocks you sold that then jumped 30% in following weeks.
One stock I have a bit of remorse on, but then I realize I still did very well. I bought SSW in March at $5.59 and sold $7.50 calls to generate a little additional income. It rocketed from $5.59 to $6.80 and I bought a second tranche as I felt there was more upside potential. I was right... but decided to lock some of those gains in and sold more $7.50 calls for 90 cents. It is now $9.22. So I did end up losing a bunch of upside. But I made 40% in 45 days... hard to be unhappy about that. So now I just wait until the fall (August and November), then I'll get my cash and look for other opportunities.
My big Misc stock for the week was OMER. They announced earnings, which were mediocre. But they also announced they're filing marketing plans for OMS721, their potential blockbuster drug. That news caused stock to spike 23% Friday from a massive short squeeze. I actually sold 1/3 of my position at $19.80. I have seen this play before and I believe it is likely OMER pulls bach 5 to 15% next week. And if it doesn't... I still have the other 65%.
I did do some trading this week and my best success was DSX, which popped 10% on earnings. I also bought back into EGC. This is a very interesting situation of a company that is recovering from bankruptcy and has some great assets but is a bit cash flow challenged. So they did some horse trading this week (it was like shark tank) and give up 35% equity for solving main cash flow issues (Energy XXI -15% after cutting $320M in P&A costs, asset buyer takes 35% stake).
You can see they took a 15% haircut when deal was announced, but my view is that is ridiculous - the deal does take away some upside (in my opinion), but gives them a much more stable (with still very good profits if oil stays high) future.
Besides OMER, I also watched one of my small banks (finally!) FUNC pop on catalyst that they may get added to Russell Index. They were up 20% on the rumor and I posted an article that believes (if added) they could quickly go from $22.50 to $27.00. We'll see, I am pretty sure I'd be a seller before $27. Oh, oh, another laggard, SLSDF actually popped a bunch this week, 25% all the way to 32 cents. yes I own a virtual penny stock. They announce earnings pretty soon and I also think people are hopeful that they may put themselves up for sale.
With that catalyst on reconstitution of Russell occuring this weekend, I did buy a basket of 18 other stocks that I felt have a chance of making index. Here they are and we'll see how they do next week (they were up 1.78% in aggregate today, 0.60% post my buying - so I am not the only one out there buying).
| Stock | Start Price | Current Price | Change |
| acfc | 10.77 | 10.70 | -0.6% |
| agle | 10.10 | 9.94 | -1.6% |
| aoi | 18.83 | 18.15 | -3.6% |
| aubn | 44.00 | 44.88 | 2.0% |
| brt | 12.49 | 12.78 | 2.3% |
| cool | 24.76 | 25.16 | 1.6% |
| dwsn | 7.19 | 7.45 | 3.6% |
| fccy | 21.65 | 21.55 | -0.5% |
| fcel | 1.95 | 1.95 | 0.0% |
| fraf | 35.90 | 35.90 | 0.0% |
| gdp | 14.02 | 14.05 | 0.2% |
| hbio | 4.98 | 4.90 | -1.6% |
| ovly | 20.84 | 20.44 | -1.9% |
| pfsw | 9.87 | 10.34 | 4.8% |
| spne | 12.10 | 12.54 | 3.6% |
| srra | 2.25 | 2.21 | -2.0% |
| synl | 18.43 | 18.70 | 1.5% |
| tess | 18.36 | 18.65 | 1.6% |
| tmq | 1.21 | 1.22 | 1.2% |
| zfgn | 6.65 | 6.57 | -1.2% |
| Total | 0.5% |
Finally, here are my gold/mining stocks. NSU did get an unsolicited offer. So that is 2 of my 10 since December... that is kind of what I expected with the small banks more than miners.
| Miner | Start | Current | Change | 2018 Change |
| TORXF | 9.90 | 9.93 | 0.3% | 4.5% |
| SAND | 4.48 | 4.81 | 7.4% | -3.6% |
| NSU | 2.38 | 3.55 | 49.2% | 45.5% |
| KLDX | 2.41 | 2.47 | 2.5% | -5.4% |
| KL | 14.49 | 19.45 | 34.2% | 26.6% |
| GSS | 0.87 | 0.71 | -17.6% | -19.8% |
| FSM | 4.24 | 5.70 | 34.4% | 9.2% |
| EXK | 2.14 | 2.92 | 36.4% | 22.2% |
| BTG | 2.61 | 2.89 | 10.7% | -6.8% |
| EGO | 1.18 | 0.95 | -19.5% | -33.6% |
| Total | 13.8% | 3.9% |
You can see NSU is now +45% in 2018. They were coy about the offer... I think they want more $. Overall, very pleased with 3.9% in 2018 and 13.8% overall. These baskets work well for me as I don't get to focused/worried about a specific stock. If I did, I might have sold KLDX when it dropped like 20% on bad mine results. Usually puke sells are bad sells.
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