But it could have been much much worse. AVCI announced their earnings last night and pretty much as I suspected. Their one big product has run its course and so they are changing their focus. AVCI dropped over 30% today. I am not optimistic that they are anywhere close to done dropping. I think they have a bit over $5 per share, and probably have an earning stream of another $1. So $6 is the floor. But I don't know what they'll be selling or who they'll be selling it to in a year.
I do feel badly for any readers who lost $ on AVCI.
I did have two companies report their earnings today. One before the bell (DGX) and one after the bell (CREL). DGX seemed not so good to me as they had lost a major contract (UNH). But they held up relatively well. CREL had pre-announced so I don't think anyone is surprised. They did provide guidance, and it seemed ok. The one item I don't understand is why CREL has such a large diverence between non-GAAP earnings (which are positive) and GAAP earnings (which seem not so hot). I'll have to do a little digging, not that I intend to sell another stock early.
I just missed on TGIS today. I put in a bid order for $11.90 at lunch today to add them as a sidecar. If I had offered close to $12 I would have surely filled the order. Then around 2pm they announced an extention of a contract, and the stock shot up 7.5%. Darn it! I will likely retain TGIS after my year is up on May 1st. It isn't on the list, but I think that is a data issue. The one stock I think I'll buy in next pass will be NOOF. They fit in the small company with dividend profile. I figure their diviy will be between 3.5% and 4%.
Speaking of dividends, PDS announced their monthly dividend. 19 cents. That is pretty nice. 19 x 12 would be $2.28. For a $25 stock, that is around 9%. Sweet.
Thursday, April 19, 2007
Monday, April 16, 2007
Something to Talk About
Great Bonnie Raitt song! Lots to discuss this Blog. Where to start?
What Do These Stocks have in Common?
Riddle me this: what do BBSI, TGIS, MTEX and CHKE have in common? Answer at the bottom.
Hit the Road Study
As readers may recall I have started a hit the road study with the idea of selling stocks in a test portfolio when they fall off the MFI screens. While I will continue with my real time study, I used some data sent to me by Joe W. on the Yahoo board to backtest it. I tried many different permuations, one I did while standing on my head. But the long and short of it was that I could find no predictable sell rule In the hundred and fifty stocks I looked at. JG said as much, I'll keep looking but I am less optimistic.
Mutual Fund Formula?
I was reading Smart Money this weekend. They had backtested an approach of picking mutual funds that had out-performed the market by an average of 7 points. Basically you pick the MF with the highest 52 week return and you buy and hold it for a year. And then you roll your money into the best fund the next year. The Fund has to be a broad market fund rather than a sector. It works for both domestic and international funds. Might worth trying. Here are the two best per my Fidelity Search engine (drum roll please):
Federated Strategic Value CL I (SVAIX) $6.73
Dreyfus Premier Greater China CL R (DPCRX) $43.03
Hmm, wonder if China is a "sector"?
Winners and Losers
A solid day for my portfolio today. I did lose out to the Russell 3000, but I kinda expected that after my great week last week. CHKE announced their earnings today (CHEROKEE Q4 earnings rise on one-time item). They weren't that great in my opinion, actually down from prior year excluding the $33m from MOSS. Since everyone already knew about that it should be excluded. I would not be surprised to see stock drop back tomorrow when people figure that out.
Then ISNS shot up today, almost 8%. Not sure why, though they are presenting in Europe (Image Sensing Systems Launches Autoscope Terra Products at TRAFFEX).
Finally DGX dropped as they announced they were buying another company for $2b (Quest Diagnostics chases AmeriPath ).
Missing IWV Dividend
I have wondered in the blog several times why the IWV ETF wasn't showing any dividends in Yahoo since Spetember. Today I finally went to the source and Barclay's iShares showed 33 cent dividends Dec 20th and March 23rd. Aha! So IWV gained several thousand $ on my MFI with the inclusion of the missing dividends (I treated them as if shares were added on dates of dividends).
Answer to Riddle
CHKE, TGIS, MTEX and BBSI are all small cap stocks in my MFI portfolio. They are all up over 20%. The final item they have in common is that they all pay a decent dividend. Coincidence? Maybe not. It seems that if a small cap is willing to commit to a dicvidend they must have confidence in future cash flows. That is a reason I recently added GVHR. Then today I replaced AVCI with WSTG. WSTG is one of my smallest stocks (market cap of $66m and I moved the market today). They pay almost a 4% dividend. Stay tuned and see if it works! I should note in January I almost bought CPSI and they are up about 15% since I considered them and they pay a 5% dividend.
What Do These Stocks have in Common?
Riddle me this: what do BBSI, TGIS, MTEX and CHKE have in common? Answer at the bottom.
Hit the Road Study
As readers may recall I have started a hit the road study with the idea of selling stocks in a test portfolio when they fall off the MFI screens. While I will continue with my real time study, I used some data sent to me by Joe W. on the Yahoo board to backtest it. I tried many different permuations, one I did while standing on my head. But the long and short of it was that I could find no predictable sell rule In the hundred and fifty stocks I looked at. JG said as much, I'll keep looking but I am less optimistic.
Mutual Fund Formula?
I was reading Smart Money this weekend. They had backtested an approach of picking mutual funds that had out-performed the market by an average of 7 points. Basically you pick the MF with the highest 52 week return and you buy and hold it for a year. And then you roll your money into the best fund the next year. The Fund has to be a broad market fund rather than a sector. It works for both domestic and international funds. Might worth trying. Here are the two best per my Fidelity Search engine (drum roll please):
Federated Strategic Value CL I (SVAIX) $6.73
Dreyfus Premier Greater China CL R (DPCRX) $43.03
Hmm, wonder if China is a "sector"?
Winners and Losers
A solid day for my portfolio today. I did lose out to the Russell 3000, but I kinda expected that after my great week last week. CHKE announced their earnings today (CHEROKEE Q4 earnings rise on one-time item). They weren't that great in my opinion, actually down from prior year excluding the $33m from MOSS. Since everyone already knew about that it should be excluded. I would not be surprised to see stock drop back tomorrow when people figure that out.
Then ISNS shot up today, almost 8%. Not sure why, though they are presenting in Europe (Image Sensing Systems Launches Autoscope Terra Products at TRAFFEX).
Finally DGX dropped as they announced they were buying another company for $2b (Quest Diagnostics chases AmeriPath ).
Missing IWV Dividend
I have wondered in the blog several times why the IWV ETF wasn't showing any dividends in Yahoo since Spetember. Today I finally went to the source and Barclay's iShares showed 33 cent dividends Dec 20th and March 23rd. Aha! So IWV gained several thousand $ on my MFI with the inclusion of the missing dividends (I treated them as if shares were added on dates of dividends).
Answer to Riddle
CHKE, TGIS, MTEX and BBSI are all small cap stocks in my MFI portfolio. They are all up over 20%. The final item they have in common is that they all pay a decent dividend. Coincidence? Maybe not. It seems that if a small cap is willing to commit to a dicvidend they must have confidence in future cash flows. That is a reason I recently added GVHR. Then today I replaced AVCI with WSTG. WSTG is one of my smallest stocks (market cap of $66m and I moved the market today). They pay almost a 4% dividend. Stay tuned and see if it works! I should note in January I almost bought CPSI and they are up about 15% since I considered them and they pay a 5% dividend.
Saturday, April 14, 2007
Weekly Charts
Here are my two weekly charts. First the wonderful graph (note the magenta line is my portfolio and the blue is Russell 3000):
Then here is the update of where I stand. Starting to look downright respectable.
Then here is the update of where I stand. Starting to look downright respectable.
| Current Portfolio | ||||
| Stock | Purchase Date | Cost | Current | Gain |
| PNCL | 05/04/06 | $6.68 | $17.31 | 159.1% |
| ISNS | 07/07/06 | $13.17 | $17.85 | 35.5% |
| VPHM | 09/11/06 | $11.79 | $15.31 | 29.8% |
| BBSI | 09/06/06 | $19.56 | $24.95 | 28.3% |
| CHKE | 05/16/06 | $37.55 | $44.28 | 25.1% |
| TGIS | 05/01/06 | $10.34 | $12.24 | 21.8% |
| FTO | 05/15/06 | $28.76 | $34.57 | 20.7% |
| MTEX | 05/22/06 | $13.11 | $15.29 | 19.1% |
| KG | 05/31/06 | $17.31 | $20.43 | 18.0% |
| PDS | 03/01/07 | $22.58 | $25.80 | 15.0% |
| ASEI | 10/05/06 | $45.85 | $52.42 | 14.3% |
| TGB | 03/27/07 | $2.64 | $3.00 | 13.6% |
| LRCX | 02/26/07 | $46.66 | $51.86 | 11.1% |
| ANF | 03/05/07 | $74.81 | $81.81 | 9.4% |
| CREL | 02/26/07 | $12.50 | $13.56 | 8.5% |
| BLDR | 09/18/06 | $15.91 | $16.85 | 5.9% |
| DGX | 02/26/07 | $52.11 | $54.27 | 4.3% |
| THO | 03/26/07 | $40.30 | $41.20 | 2.2% |
| GVHR | 04/03/07 | $19.17 | $19.50 | 2.2% |
| IVAC | 03/06/07 | $26.12 | $26.18 | 0.2% |
| JTX | 04/09/07 | $28.70 | $28.26 | -1.5% |
| PACR | 02/26/07 | $28.26 | $27.65 | -1.6% |
| PONR | 05/09/06 | $30.48 | $29.39 | -3.6% |
| SHOO | 01/17/07 | $32.36 | $30.55 | -5.6% |
| TRLG | 06/13/06 | $17.02 | $15.94 | -6.3% |
| ORCT | 06/02/06 | $11.83 | $10.94 | -7.5% |
| HW | 02/27/07 | $24.00 | $21.81 | -9.1% |
| EGY | 02/05/07 | $6.42 | $5.83 | -9.2% |
| RAIL | 05/26/06 | $58.18 | $48.99 | -15.5% |
| FDG | 05/31/06 | $34.03 | $23.30 | -22.8% |
| EZEN.OB | 06/19/06 | $2.84 | $1.73 | -39.0% |
| OVTI | 05/31/06 | $27.79 | $12.74 | -54.2% |
| Gain/Loss Open Positions ($): | $29,563 | |||
| Gain/Loss Open Positions (%): | 7.0% | |||
| Gain/Loss Closed Positions ($): | $31,113 | |||
| Gain/Loss Closed Positions (%): | 17.0% | |||
| Total Gain/Loss ($): | $60,676 | |||
| Benchmark Gain/Loss ($): | $46,194 | |||
| Annual IRR: | 19.4% | |||
| Total Gain/Loss (%): | 14.8% | |||
Friday, April 13, 2007
Arrivederci Avci
Great day ending a great week. Portfolio up almost another 1%. I don't have graphs and charts yet, will try and update later this weekend. My portfolio is a rocket though, you'll see it when you see the graph. I do know I am up over 60K in total and have about a 12K edge on the benchmark.
I am Not a Potted Plant
I did break the rules for the 2nd time today. I sold AVCI, which was up about 55% for me. I know, I know, I only bought it 2 months ago. But here is what I read in their 10K today:
We cannot predict future revenue volumes, however we do not believe that the revenue volumes experienced during 2006 will be sustainable and we are planning the business at reduced revenue volumes.
I can't ignore these paragraphs. One belief I have in MFI is that the ttm income has to reproducable. Remember FORD anyone? AVCI is essentially saying they don't believe 2006 is sustainable. Then all the business with one customer... reminds me of PLAY. So I sold today, not wanting to hear their quarterly results next week. Perhaps they have a great product and will get new customers, but it seems to me a strong statement when they are "planning business (meaning people to me) for reduced revenues".
I also used this great week to sell my side car holdings (now up over $31k) of BBSI and VPHM. So I am sitting in more cash than normal.
Graphs and tables to follow tomorrow. I am going to watch "An Inconvinient Truth" now.
I am Not a Potted Plant
I did break the rules for the 2nd time today. I sold AVCI, which was up about 55% for me. I know, I know, I only bought it 2 months ago. But here is what I read in their 10K today:
We cannot predict future revenue volumes, however we do not believe that the revenue volumes experienced during 2006 will be sustainable and we are planning the business at reduced revenue volumes.
Service revenue increased $1.6 million to $6.4 million in 2006 from $4.8 million in 2005. The increase in service revenue was primarily due to a larger installed base of products.
One customer, namely AT&T accounted for 94% of the gross revenue in 2006 and 2005. We anticipate future core router product revenue to continue to be highly concentrated from this one customer.
I can't ignore these paragraphs. One belief I have in MFI is that the ttm income has to reproducable. Remember FORD anyone? AVCI is essentially saying they don't believe 2006 is sustainable. Then all the business with one customer... reminds me of PLAY. So I sold today, not wanting to hear their quarterly results next week. Perhaps they have a great product and will get new customers, but it seems to me a strong statement when they are "planning business (meaning people to me) for reduced revenues".
I also used this great week to sell my side car holdings (now up over $31k) of BBSI and VPHM. So I am sitting in more cash than normal.
Graphs and tables to follow tomorrow. I am going to watch "An Inconvinient Truth" now.
Thursday, April 12, 2007
Giddy-Up!
Wow, talk about firing on all cylinders, stepping on the gas, going zero to sixty! At the end of last week, my portfolio was a bit behind the Russell 3000. After 4 short days, we're about 2.5% above the benchmark. Definitely some real money. Actually as of today I acually have the widest range over the benchmark yet. We'll see if it holds for the official #s published this weekend. The sidecar is also smoking, I think it went up about 3% today.Many heros. First ANF had very good same store sales (Abercrombie & Fitch Reports March Net Sales Increase 29%; Comparable Store Sales Increase 7%). That was good for a 5% pop. Remember just yesterday I posted a remark about an analyst saying ANF had Bottom's Problems. I will say it again, many analysts don't have a clue.
The CREL pre-announced their quarter (Corel Boosts Outlook). That was good for 4.5%. PDS was up over 6%, IVAC was up over 7%, LRCX had a solid quarter (reported after the bell). Overall, my MFI stocks were up 1.75% today. Yee-haw!
I was looking forward today. I have three stocks up in early May: TGIS, PNCL and PONR. I will likely retain PNCL, though fewer shares. PONR is at a loss and I may sell a few days early. I did look at a few microcaps on the list today. PVM looked interesting. I also liked VGR (a tobacco replacement for my favorite UST. VGR also pays an 8% dividend).
I see where EGY re-appeared on the MFI lists today. Quick Blue Light Special update. The portfolio I set up in mid Januray was up 1.8%. It is now up 8.4% overall vs 2% for the benchmark.
It has been a while since I have posted a list, so let me do so now. Have a good one!
| Name (in alphabetical order) | Ticker | Market Cap ($ Millions) | Pre Tax Earnings Yield | Pre Tax Return on Capital | Price From | Most Recent Quarter Data |
|---|---|---|---|---|---|---|
| Aspreva Pharmaceuticals Corp | ASPV | 757.70 | 26% | > 100% | 04/11 | 12/31 |
| Avici Systems Inc | AVCI | 182.83 | 13% | > 100% | 04/11 | 12/31 |
| Axcan Pharma Inc | AXCA | 771.27 | 11% | > 100% | 04/11 | 12/31 |
| Barrett Business Services Inc | BBSI | 268.98 | 11% | > 100% | 04/11 | 12/31 |
| CCA Industries Inc. | CAW | 71.75 | 15% | > 100% | 04/11 | 11/30 |
| Corel Corp | CREL | 316.50 | 9% | > 100% | 04/11 | 11/30 |
| Cryptologic Inc | CRYP | 346.48 | 11% | > 100% | 04/11 | 12/31 |
| EPIQ Systems Inc | EPIQ | 428.34 | 12% | > 100% | 04/11 | 12/31 |
| Eagle Test Systems Inc | EGLT | 367.80 | 16% | > 100% | 04/11 | 12/31 |
| Endo Pharmaceuticals Holdings Inc | ENDP | 4,049.45 | 9% | > 100% | 04/11 | 12/31 |
| Fording Canadian Coal Trust | FDG | 3,307.50 | 17% | > 100% | 04/11 | 12/31 |
| Freeport-McMoran Copper & Gold Inc. | FCX | 13,773.76 | 18% | 75 - 100% | 04/11 | 12/31 |
| Frontier Oil Corp. | FTO | 3,749.49 | 15% | 75 - 100% | 04/11 | 12/31 |
| Gevity HR Inc | GVHR | 495.96 | 10% | > 100% | 04/11 | 12/31 |
| Harland (John H.) Co | JH | 1,354.83 | 9% | > 100% | 04/11 | 12/31 |
| Holly Corp | HOC | 3,436.29 | 11% | 75 - 100% | 04/11 | 12/31 |
| Intevac Inc | IVAC | 512.49 | 11% | > 100% | 04/11 | 12/31 |
| JAKKS Pacific Inc | JAKK | 669.43 | 16% | 75 - 100% | 04/11 | 12/31 |
| Jackson Hewitt Tax Service Inc | JTX | 896.33 | 9% | > 100% | 04/11 | 01/31 |
| K-Swiss Inc | KSWS | 943.04 | 15% | > 100% | 04/11 | 12/31 |
| King Pharmaceuticals Inc. | KG | 4,974.87 | 14% | > 100% | 04/11 | 12/31 |
| Korn/Ferry International | KFY | 984.15 | 11% | > 100% | 04/11 | 01/31 |
| Labor Ready Inc. | LRW | 907.92 | 15% | > 100% | 04/11 | 12/31 |
| Lam Research Corp | LRCX | 7,129.01 | 11% | > 100% | 04/11 | 12/31 |
| Mannatech Inc | MTEX | 397.47 | 12% | > 100% | 04/11 | 12/31 |
| Motorola Inc. | MOT | 41,930.53 | 13% | > 100% | 04/11 | 12/31 |
| Nathan's Famous Inc | NATH | 86.79 | 10% | > 100% | 04/11 | 12/31 |
| New Frontier Media Inc | NOOF | 210.90 | 11% | > 100% | 04/11 | 12/31 |
| Northgate Minerals Corp | NXG | 877.80 | 21% | 50 - 75% | 04/11 | 12/31 |
| Nucor Corp | NUE | 20,025.15 | 14% | 50 - 75% | 04/11 | 12/31 |
| OmniVision Technologies Inc | OVTI | 700.58 | 14% | 75 - 100% | 04/11 | 01/31 |
| Optimal Group Inc | OPMR | 210.37 | 24% | > 100% | 04/11 | 12/31 |
| PW Eagle Inc | PWEI | 400.63 | 26% | 75 - 100% | 04/11 | 12/31 |
| Pacer International Inc | PACR | 959.08 | 11% | > 100% | 04/11 | 12/31 |
| Pinnacle Airlines Corp | PNCL | 383.99 | 20% | 75 - 100% | 04/11 | 12/31 |
| Pre-Paid Legal Services Inc. | PPD | 691.21 | 11% | > 100% | 04/11 | 12/31 |
| Prestige Brands Holdings Inc | PBH | 560.06 | 10% | > 100% | 04/11 | 12/31 |
| Psychemedics Corp | PMD | 85.65 | 10% | > 100% | 04/11 | 12/31 |
| Steven Madden Ltd | SHOO | 622.84 | 15% | 75 - 100% | 04/11 | 12/31 |
| Teck Cominco Ltd | TCK | 15,772.64 | 23% | 75 - 100% | 04/11 | 12/31 |
| Thor Industries Inc. | THO | 2,243.92 | 12% | 75 - 100% | 04/11 | 10/31 |
| USA Mobility Inc | USMO | 561.98 | 14% | 75 - 100% | 04/11 | 12/31 |
| United Online Inc | UNTD | 912.06 | 11% | > 100% | 04/11 | 12/31 |
| Vaalco Energy Inc | EGY | 324.49 | 25% | > 100% | 04/11 | 12/31 |
| Valassis Communications Inc. | VCI | 841.95 | 13% | 75 - 100% | 04/11 | 12/31 |
| Value Line Inc | VALU | 456.08 | 9% | > 100% | 04/11 | 10/31 |
| Verigy Ltd | VRGY | 1,516.44 | 10% | > 100% | 04/11 | 01/31 |
| ViroPharma Inc | VPHM | 1,046.55 | 12% | > 100% | 04/11 | 12/31 |
| Western Refining Inc | WNR | 2,339.39 | 15% | > 100% | 04/11 | 12/31 |
| Williams Controls Inc | WMCO | 126.52 | 12% | 75 - 100% | 04/11 | 12/31 |
Wednesday, April 11, 2007
Bottoms Up!
Slow news day today. My stocks held up decently on a crummy day. PDS was up nicely and I have now made about 9% on them. I have expanded my lead over the Russell 3000 to over $5,000. But I have seen bigger leads evaporate.
Since little news today, the only news was what news will be coming up tomorrow... if you follow.
ANF - I had to laugh. They report same store sales tomorrow. Here is what an analyst said about expectations for ANF (it makes me happy as I like low expectations: "Abercrombie remains hampered by lack of bottoms business and sameness across concepts, in our view." What does that mean exactly? "Lack of Bottoms Business"? I guess they must only have tops.
LRCX - they report earnings tomorrow. Keep those fingers crossed.
Finally, my timing has been off of late, IVAC dove today. Not sure why, but the Blue Light Special approach would say (in Cramer terms) "Buy, buy, buy!" It has dropped from $27.94 to $24.23 since March 26th.
Since little news today, the only news was what news will be coming up tomorrow... if you follow.
ANF - I had to laugh. They report same store sales tomorrow. Here is what an analyst said about expectations for ANF (it makes me happy as I like low expectations: "Abercrombie remains hampered by lack of bottoms business and sameness across concepts, in our view." What does that mean exactly? "Lack of Bottoms Business"? I guess they must only have tops.
LRCX - they report earnings tomorrow. Keep those fingers crossed.
Finally, my timing has been off of late, IVAC dove today. Not sure why, but the Blue Light Special approach would say (in Cramer terms) "Buy, buy, buy!" It has dropped from $27.94 to $24.23 since March 26th.
Tuesday, April 10, 2007
Taxing Issue
Quick post tonight (I promise) as it is past my bedtime. It appears I bought JTX several days too early. They announced today that they would be discontinuing their program of loaning people their refund checks (Jackson Hewitt Ending Preseason Loans). It was an unsavory deal, as the loans were only for 3 or 4 weeks yet had what amounted to usury interest rates when you considered the fees. Still, it will likely cost JTX some revenue and profit. Thus they were down about 5% today.
That being said, it was a very solid day for my portfolio. I was up over a half percent, much better than the inidces which were up marginally. EGY was the big gainer, up about 7%. Cramer actually said he liked EGY (this was several days ago) at $5. I wonder if that halo is driving the stock a bit? If so, this would be the time to sell!
Finally, with the sale of VRGY from my sidecar yesterday, I used 1/2 the funds to buy IVAC this am at $25.65.
I will give more thorough updates later this week. I have been on the road and don't have access to anything more than what I keep in Yahoo! Finance.
Good night.
That being said, it was a very solid day for my portfolio. I was up over a half percent, much better than the inidces which were up marginally. EGY was the big gainer, up about 7%. Cramer actually said he liked EGY (this was several days ago) at $5. I wonder if that halo is driving the stock a bit? If so, this would be the time to sell!
Finally, with the sale of VRGY from my sidecar yesterday, I used 1/2 the funds to buy IVAC this am at $25.65.
I will give more thorough updates later this week. I have been on the road and don't have access to anything more than what I keep in Yahoo! Finance.
Good night.
Monday, April 09, 2007
Good News!
Wow, I had my best earnings report in what seems like eons. TGIS came through with some very solid numbers (Thomas Group 4Q Profit More Than Triples). The result? TGIS went up 10.7%. I think they still have a lot of upside as they have been over $16 a couple of times in past 52 weeks.
AVCI continues to burn the shorts. They were up another $1.07 today and are now up 51% since I bought them 2 months ago. I don't realistically expect them to go up parabolically (sp?), but I wonder if 14% is still short.
JTX was added first thing this morning at $28.70. Then my final move was to sell my sidecar holding of VRGY which did very very well under a month. I had a 1/3 of my sidecar in VRGY, so as I like to say, "even my feet are smiling!".
The net result of all this good news is that my MFI portfolio was up a shade over 1% while the Russell 3000 was up 0.17%.
AVCI is an interesting lesson. I bought them right after their year end earnings which catapulted them onto the MFI list. Do people think that a stock that jumps on the list suddenly like that is a stronger buy than those stocks that seem to have been on the list for the past year? There is something psychologically satisfying about a "new" stock rather than the warmed over old stocks. I don't know whether this would transform into better returns. Thoughts?
AVCI continues to burn the shorts. They were up another $1.07 today and are now up 51% since I bought them 2 months ago. I don't realistically expect them to go up parabolically (sp?), but I wonder if 14% is still short.
JTX was added first thing this morning at $28.70. Then my final move was to sell my sidecar holding of VRGY which did very very well under a month. I had a 1/3 of my sidecar in VRGY, so as I like to say, "even my feet are smiling!".
The net result of all this good news is that my MFI portfolio was up a shade over 1% while the Russell 3000 was up 0.17%.
AVCI is an interesting lesson. I bought them right after their year end earnings which catapulted them onto the MFI list. Do people think that a stock that jumps on the list suddenly like that is a stronger buy than those stocks that seem to have been on the list for the past year? There is something psychologically satisfying about a "new" stock rather than the warmed over old stocks. I don't know whether this would transform into better returns. Thoughts?
Sunday, April 08, 2007
April 7th 2006 Tracking Portfolio
I decided today to put in an order for JTX as a new MFI stock for me. I have follwed them for a year. I like their market position and opportunity to take business from HRB. The stock has dropped from $32.50 to $28.70 in the past week and seems like a strong buy to me. Hopefully I can get a price around $28.70! I am thinking about taxes as I am mailing two hefty checks to the US Treasury today. My own taxes have gotten so complex that I see te appeal of JTX. I did have to get my own expert for my taxes (KPMG).
Here is a summary of the stocks in the April 7th portfolio. This portfolio did underperform the indices by a couple of points. These amounts should include dividends. I did have the good fortune to have bought DLX & PGI, so this was a good month for me personally. Quite a few of these stocks have been bought - JH, KOSP, NSS and PLAY :
| AEO $19.84 $29.90 50.7% |
| CHKP $18.50 $22.69 22.6% |
| DLX $24.36 $34.98 43.6% |
| ELNK $9.36 $7.48 -20.1% |
| FTO $29.12 $33.16 13.9% |
| JAKK $26.76 $24.30 -9.2% |
| JH $38.69 $52.45 35.6% |
| KFY $20.02 $23.08 15.3% |
| KG $17.58 $19.99 13.7% |
| KOSP $44.78 $78.0 74.2% |
| KSWS $29.0 $28.06 -3.2% |
| MEDQ.PK $13.70 $10.0 -27.0% |
| MVL $19.97 $29.42 47.3% |
| NSS $47.12 $65.0 37.9% |
| PGI $7.76 $11.50 48.2% |
| PLAY $21.75 $13.47 -38.1% |
| PRAI $26.97 $21.34 -20.9% |
| RAIL $63.62 $46.61 -26.7% |
| SYNA $23.45 $25.18 7.4% |
| TBL $33.99 $26.18 -23.0% |
| UNTD $12.11 $13.91 14.9% |
| UST $39.82 $60.07 50.9% |
| VCI $29.52 $17.99 -39.1% |
| VPHM $11.83 $14.40 21.7% |
| WON $10.23 $6.73 -34.2% |
Saturday, April 07, 2007
Happy Easter
I am back from whirlwind road trip. I took the pulse of my portfolio and can't say it is very exciting, though certainly still alive. I have fallen $800 behind the stubborn Russell 3000 benchmark. I did make several portfolio moves:
Then here is my current portfolio and how my sold stocks have performed. Starting to get some weight in the sold column. TGIS at 5/1/07 will be my next potential stock to sell.
Happy Easter everyone!
- I sold DLX and bought GVHR. DLX was a great success and ended up 36% for me. Not bad for a sleepy check company. I all but pulled GVHR out of a hat. No real deep thinking.
- Then I added some VRGY to my sidecar. That gives me VRGY, RAIL, BBSI, TBL, NOOF and VPHM. The sidecar is now up over $27,000 and has really done well.
- Mid January Blue Light Special: Up 6.5% vs 1.7% for Benchmark. VCI is the leader, up 30%.
- Mid March Blue Light Special: +5.1% vs 4.5% for benchmark. BVF is up 15%.
- Hit The Road Portfolio is up just 0.2%. They will be measured against themselves. Only one stock of the 50 has disappeared: BWLRF.
Then here is my current portfolio and how my sold stocks have performed. Starting to get some weight in the sold column. TGIS at 5/1/07 will be my next potential stock to sell.
Happy Easter everyone!
| Current Portfolio | ||||
| Stock | Purchase Date | Cost | Current | Gain |
| PNCL | 05/04/06 | $6.68 | $17.26 | 158.4% |
| AVCI | 02/20/07 | $8.65 | $11.98 | 38.5% |
| ISNS | 07/07/06 | $13.17 | $17.20 | 30.6% |
| BBSI | 09/06/06 | $19.56 | $24.13 | 24.1% |
| CHKE | 05/16/06 | $37.55 | $43.77 | 23.7% |
| VPHM | 09/11/06 | $11.79 | $14.40 | 22.1% |
| MTEX | 05/22/06 | $13.11 | $15.25 | 18.8% |
| FTO | 05/15/06 | $28.76 | $33.16 | 15.8% |
| KG | 05/31/06 | $17.31 | $19.99 | 15.5% |
| ASEI | 10/05/06 | $45.85 | $52.12 | 13.7% |
| TGIS | 05/01/06 | $10.34 | $11.11 | 10.8% |
| TGB | 03/27/07 | $2.64 | $2.86 | 8.3% |
| LRCX | 02/26/07 | $46.66 | $49.40 | 5.9% |
| PDS | 03/01/07 | $22.58 | $23.45 | 4.6% |
| BLDR | 09/18/06 | $15.91 | $16.55 | 4.1% |
| CREL | 02/26/07 | $12.50 | $12.94 | 3.5% |
| ANF | 03/05/07 | $74.81 | $77.23 | 3.2% |
| GVHR | 04/03/07 | $19.17 | $19.18 | 0.1% |
| IVAC | 03/06/07 | $26.12 | $26.05 | -0.3% |
| DGX | 02/26/07 | $52.11 | $51.30 | -1.6% |
| THO | 03/26/07 | $40.30 | $39.12 | -2.9% |
| PONR | 05/09/06 | $30.48 | $28.96 | -5.0% |
| HW | 02/27/07 | $24.00 | $22.49 | -6.3% |
| TRLG | 06/13/06 | $17.02 | $15.92 | -6.5% |
| SHOO | 01/17/07 | $32.36 | $30.04 | -7.2% |
| PACR | 02/26/07 | $28.26 | $25.84 | -8.0% |
| ORCT | 06/02/06 | $11.83 | $10.63 | -10.1% |
| RAIL | 05/26/06 | $58.18 | $46.61 | -19.6% |
| EGY | 02/05/07 | $6.42 | $5.01 | -22.0% |
| FDG | 05/31/06 | $34.03 | $22.19 | -26.0% |
| EZEN.OB | 06/19/06 | $2.84 | $1.71 | -39.7% |
| OVTI | 05/31/06 | $27.79 | $12.58 | -54.7% |
| Gain/Loss Open Positions ($): | $19,731 | |||
| Gain/Loss Open Positions (%): | 4.7% | |||
| Gain/Loss Closed Positions ($): | $22,589 | |||
| Gain/Loss Closed Positions (%): | 13.5% | |||
| Total Gain/Loss ($): | $42,320 | |||
| Benchmark Gain/Loss ($): | $43,162 | |||
| Annual IRR: | 14.6% | |||
| Total Gain/Loss (%): | 10.7% | |||
Thursday, April 05, 2007
Texas Road Trip
Sorry for not mentioning in a blog, but I am on a Texas Road Trip with my family and will then be going on a business trip to NYC. I haven't had time to write anything meaningful. I will likely post a full post this Monday.
Wednesday, March 28, 2007
Distributions
Sorry in advance if this post gets a little technical. I did a q&d analysis of the 167 stocks that have closed or almost closed in my monthly tracking portfolios. Before I get to it though, a couple quick comments.
I sold PGI today. Yes it is a week shy of my anniversary, but it was in my IRA so taxes were not a consideration. Also, I am on vacation all of next week. I ended up making about 45% on the trade, making it my 2nd best sold MFI stock after UST. My purchases of THO and TGB are now totally official. DLX has a week to go. I will hold for the week as it is in my brokerage account and I am up about 30%.
It was a down day in the market today. My portfolio held up pretty well. AVCI was up another 45 cents. I think it is now up about 45% for me. It has gone up so quickly that I expect it to drop quickly as well. Maybe I'll be wrong. It was "dividend day" for me. I collected on MTEX, TGIS, FDG, FTO & PDS. Over $500. I feel rich!
Now for the study.
I sold PGI today. Yes it is a week shy of my anniversary, but it was in my IRA so taxes were not a consideration. Also, I am on vacation all of next week. I ended up making about 45% on the trade, making it my 2nd best sold MFI stock after UST. My purchases of THO and TGB are now totally official. DLX has a week to go. I will hold for the week as it is in my brokerage account and I am up about 30%.
It was a down day in the market today. My portfolio held up pretty well. AVCI was up another 45 cents. I think it is now up about 45% for me. It has gone up so quickly that I expect it to drop quickly as well. Maybe I'll be wrong. It was "dividend day" for me. I collected on MTEX, TGIS, FDG, FTO & PDS. Over $500. I feel rich!
Now for the study.
I now basically have 4 monthly tracking portfolios that have a year under their belt. Between them I have one year results for 167 companies. I did a mini study on their results.
1. The average annual return (including dividends) was 15%.
2. The standard deviation was 34%. That seems large to me, but I have nothing to benchmark against.
Here is a distribution of gains/losses by band:
| Lose 65% | 1 |
| Lose 55% | 3 |
| Lose 45% | 2 |
| Lose 35% | 7 |
| Lose 25% | 11 |
| Lose 15% | 10 |
| Lose 5% | 22 |
| Make 5% | 23 |
| Make 15% | 22 |
| Make 25% | 19 |
| Make 35% | 12 |
| Make 45% | 11 |
| Make 55% | 5 |
| Make 65% | 6 |
| Make 75% | 2 |
| Make 85% | 7 |
| Make 95% | 2 |
| Make 105% | 1 |
| Make over 110% | 1 |
So that means (for example) that 3 of the 167 stocks lost between 50% and 60%. And seven stocks went up 80 to 90%. Stocks can appear more than once if in separate months.
I then ran what is called a monte carlo simulation against the 167 stocks, to see the distribution of expected results for a portfolio. I ran the distribution against 3 different sized portfolios: 10, 20 and 30 stocks. The table below shows my findings:
| 10 Stocks | 20 Stocks | 30 Stocks | |
| Losing Money | 7% | 2% | 0% |
| Less than 10% | 31% | 24% | 18% |
| Less Than 15% | 50% | 51% | 51% |
| More than 15% | 50% | 49% | 49% |
| More than 20% | 32% | 24% | 20% |
| More than 25% | 18% | 9% | 5% |
| More than 30% | 8% | 2% | 1% |
This table shows the volatility based on size of portfolio. So if you had a 10 stock portfolio, you had a 31% chance of making under a 10% return. You also had an 18% chance of exceeding a 25% return. As you'd expect, the more stocks that you hold, the more the distribution clusters about the average of 15%. This is a big reason why I have pushed my portfolio actually a bit over 30 stocks. I don't want the volatility, but rather I'd be very happy with the average. The distributions seemed pretty "normal", meaning they are shaped like a bell curve. They were ever so slightly skewed to the left, meaning the most common result would be to do a little worse than the mean. I'll try to update in anothe 3 motnhs when I have another 150 or so stocks in the analysis.
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