Karel's Marketocracy Fund

[Karel]

Karel,
DBRN has been heavily touted by media this past week : FOX , CNBC , IBD.

billyjoe

They can have a good idea too, once in a while ...

Regards,

Karel

[Karel]

Catching up! It is almost two months since the last report, so I will give just the standings (percentage change since last message):

IWM: 24.05 (-4.8%)
SPY: 23.67 (-0.8%)
QHF: 23.22 (-1.2%)
QQQQ: 21.15 (-6.4%)

That is just wonderful! My fund, currently nr. 3, gains on both the leader and last position. That is the way to come out on top.

On the buy and sell side, something strange came up. It seems that I forgot to buy IBCA. I will do that this Monday, because it is still (or again) the top buy. Because I will buy only one stock a week, that is were I stop, too. But the majority of my stocks is marked stalling, so the coming weeks will see quite a few changes. Stay tuned!

Regards,

Karel

[Karel]

A bit late, but here is the weekly update (numbers based on last weeks close): My fund gained +0.4%, SPY +0.2%, QQQQ lost -0.4%, and IWM -0.1%. The fund is keeping its own:

IWM: 24.03
SPY: 23.71
QHF: 23.31
QQQQ: 21.06

Again just wonderful!

The Top 3 were GIL +10.3%, CIB 4.4%, and DBRN +3.6%
The Bottom 3: GRMN -6.3%, PCU -5.1%, and TSO -3.2%

IBCA was bought for 45.38. That is +10% down the drain, as the price at the open on 6/5 was under 41. Good pick! 10 out of the 15 stocks are marked stalling now. I replaced CIB, the stalling stock with the biggest draw down, with DRQ. CIB went for 27.32, or -19.1%. DRQ was bought for 84.25. The closed trades look like this:

Winners: 29, avg +85.3%
Losers: 12, avg -23.4%
Total: 41, avg +53.5%

Marketocracy gives the annualized return as 20.6%

Regards,

Karel

[Karel]

After an absence of some 6 months, I return to this fund. It gained +6.7% in that period, not bad, but it seriously trailed the market: SPY +13.4%, QQQQ +22.5%, and IWM (Russell 2000) +17.7%! The fund is now last. Let's do something about it!

IWM: 28.29
SPY: 26.88
QQQQ: 25.79
QHF: 24.85
(QSHF: 24.85)

QSHF is new in this column. It consists of the top 3 picks (not already held) from my $$$Mr. Market$$$ approximation, picked every week, held for 6 weeks. That should give us a baseline for my strategy. I start the fund at the same price as my "real" fund.

What I am going to do is weed out the underperformers one by one, starting ny the oldest in my portfolio. But the first one to go is a relatively recent stock, FLAG, as it got bought out when I didn't notice. Flag got sold for a 1% gain in 1 month.

The Top 3 this week is CHAP, CPA and XING. My pick for my Marketocracy fund is CHAP (which will also be my POTW pick as long as it stays in this portfolio), and the Top 3 is going to replace the oldest 3 stocks in my baseline fund.

Winners: 31, avg +85.0%
Losers: 13, avg -24.0%
Total: 44, avg +52.8%

Marketocracy gives the annualized return as 19.7%

Regards,

Karel

[Karel]

The new Top 3 Picks: WCG, GEO, and RKT

What a time to return! The numbers speak for themselves:

IWM: 26.51 (-6.3%)
SPY: 25.65 (-4.6%)
QQQ: 24.21 (-6.1%)
QHF: 23.45 (-5.6%)
QHF-: 23.30 (-6.2%)

Overall, the picture is pretty bad, and then QHF wasn't even the worst performer in the list. QHF- is the new baseline port, holding my weekly top 3 $$$Mr.Market$$$ picks for 6 weeks. We expect it to underperform relative to QHF (to show our stock picking and holding strategy works), and to outperform relative to the market.

The sunshine in our portfolio came from DECK +5.1%, TSO +1.1%, and GI -0.7%(!)
Shamers were: GGB -12.1%, IBCA -11.2%, and PCU -9.9%

The new Top 3 Picks: WCG, GEO, and RKT. Do we need a new stock for QHF? Yes, we do. Currently 8 stocks are due for replacement and the one that has been waiting longest is GIL. It will get replaced by WCG.

CHAP was bought for 52.11 (and lost 7% in its first week.)

The baseline port loses 3 ancient stocks and gets our new Top 3 Picks.

Regards,

Karel

[Karel]

Top 3: GEO, PNPFF and UCTT

A nice bounce this week, and my Marketocracy fund QHF bounces the best:

IWM: 27.01 (+1.9%)
SPY: 26.04 (+1.5%)
QQQ: 24.49 (+1.2%)
QHF: 24.05 (+2.6%)
QHF-: 23.57 (+1.2%)

QHF- is the new baseline port, holding my weekly top 3 $$$Mr.Market$$$ picks for 6 weeks. We expect it to underperform relative to QHF (to show our stock picking and holding strategy works), and to outperform relative to the market.

Shiners in our portfolio were NTRI +9.1%, IBCA +7.1%, and CHAP +6.5%
Shamers were: TS -1.0%, WCG -0.3%, and GI +0.1%(!)

The new Top 3 Picks are GEO, PNPFF, and UCTT. Do we need a new stock for QHF? Yes, we do. Currently 5 stocks are due for replacement and the one that has been waiting longest is RAIL. It will get replaced by GEO.

GIL was sold for 50.63, a measly 3.2% gain in just over a year. WCG was bought for 83.83

The baseline port loses 3 ancient stocks and gets our new Top 3 Picks, that is: GEO was already present and PNPFF isn't on the Marketocracy buy list. We'll go a bit further down the list and buy UCTT, SPAR and TATTF.

Closed trades:
Winners: 32, avg +82.4%
Losers: 13, avg -24.0%
Total: 45, avg +51.7%

Regards,

Karel

[Karel]

The markets go up, the markets go down, and so does my fund. We are not really catching up in a hurry:

IWM: 26.71 (-1.1%)
SPY: 25.62 (-1.6%)
QQQ: 24.41 (-0.3%)
QHF: 23.77 (-1.2%)
QHF-: 23.39 (-0.7%)

QHF- is the new baseline port, holding my weekly top 3 $$$Mr.Market$$$ picks for 6 weeks. We expect it to underperform relative to QHF (to show our stock picking and holding strategy works), and to outperform relative to the market.

This week's hall of fame: GRMN +2.4%, WCG +2.3%, and CHAP (my current POTW pick) +2.2%
Hall of shame: GEO (my latest pick) -7.0%, TS -6.4%, and PBR -4.5%

The new Top 3 Picks are AMIE, RKT, and (again) UCTT. Do we need a new stock for QHF? Yes, we do. Currently there are (again) 5 stocks due for replacement (I sold one of last week's five, but a new one came due this week) and the one that has been waiting longest is NTRI. It will be replaced by RKT.

RAIL was sold for 48.18, a lousy -31% loss in almost 11 months. GEO was bought for 47.44.

The baseline port loses 3 ancient stocks and gets our new Top 3 Picks, that is, after AMIE come 4 stocks already in the port, so we grab nr.6, BW, and nr.7, PD, to go with AMIE. Edit: I already owned PD, too, so I had to go another rung lower: CLMT.

Closed trades:
Winners: 32, avg +82.4%
Losers: 14, avg -24.5%
Total: 46, avg +49.9%

Regards,

Karel

[Karel]

Top 3: RKT, UCTT, CHAP

Things look good this week. The markets were up and so was the fund. QHF is actually catching up! The rankings:

IWM: 27.70 (+3.7%)
SPY: 26.52 (+3.5%)
QQQ: 25.14 (+3.0%)
QHF: 24.95 (+5.0%)
QHF-: 24.31 (+3.9%)

QHF- is the new baseline port, holding my weekly top 3 $$$Mr.Market$$$ picks for 6 weeks. We expect it to underperform relative to QHF (to show our stock picking and holding strategy works), and to outperform relative to the market.

This week's hall of fame: DRQ +10.3%, PBR +10.3%, and GGB +10.2% (yes, all 3 double digit gains)
Hall of shame: GI +0.6%, RKT (my latest pick) +2.6%, and AEO +3.4% (Yes, all 3 positive)

The new Top 3 Picks are RKT (again), OFI, and CHAP. Do we need a new stock for QHF? Yes, we do. Currently there are 4 stocks due for replacement and the one that has been waiting longest is IBCA. Now we have the same problem as the previous week with our baseline fund QHF-: RKT and CHAP are already in the portolio. We therefore go a bit deeper and find the following 3 candidates for a replacement: GSTL, UCTT, XING. By the way, GSTL has an amazing R-squared of .96. That, and its earnings, make it the replacement for IBCA.

NTRI was sold for 47.34, a silly 1.5% gain in almost a year. Had I been paying attention, I would have sold three monts after its last highest weekly close (around 3 months after 5/19 of 2006), for over $64. Well, I didn't pay attention. RKT was bought for 33.89.

The baseline port loses 3 ancient stocks and gets our new Top 3 Picks, without stocks already owned in the port, so the 3 replacements will be: GSTL, PCU and GIGM.

Closed trades:
Winners: 33, avg +80.0%
Losers: 14, avg -24.5%
Total: 47, avg +48.9%

Regards,

Karel

[Karel]

No new picks

I am rather busy, so I'll pick no new stocks, just give a short report.

It was a moderately lousy week, but my marketocracy fund, QHF, managed to pass QQQQ, and is the best performer for two weeks in a row! Thta is the way I like it! The numbers:

IWM: 27.45 (-0.9%)
SPY: 26.27 (-0.9%)
QHF: 24.83 (-0.5%)
QQQQ: 24.81 (-1.3%)
QHF-: 23.69 (-2.6%)

QHF- is the new baseline port, holding my weekly top 3 $$$Mr.Market$$$ picks for 6 weeks. We expect it to underperform relative to QHF (to show our stock picking and holding strategy works), and to outperform relative to the market.

Regards,

Karel

[Karel]

I am still rather busy, so the portfolio has to wait another week for maintenance.

The week was a lot better, but my Marketocracy fund, QHF, dropped back behind QQQQ. That isn't really a downer, with a nice gain for the week. The numbers:

IWM: 27.77 (+1.2%)
SPY: 26.68 (+1.6%)
QQQQ: 25.39 (+2.3%)
QHF: 25.38 (+2.2%)
QHF-: 24.28 (+2.5%)

QHF- is the new baseline port, holding my weekly top 3 $$$Mr.Market$$$ picks for 6 weeks. We expect it to underperform relative to QHF (to show our stock picking and holding strategy works), and to outperform relative to the market.

To console myself for the loss of 3rd place, I checked with the numbers on 2/25, when I reactivated my portfolio:

Ticker: Current - 2/25 = Gain/Loss
IWM: 27.77 - 28.29 = -0.52 (-1.9%)
SPY: 26.68 - 26.88 = -0.20 (-0.7%)
QQQQ: 25.39 - 25.79 = -0.40 (-1.6%)
QHF: 25.38 - 24.85 = +0.53 (+2.1%)
(QSHF: 24.28 - 24.85 = -0.57 (-2.3%))

The consolation is a bit mixed, as my baseline port is a loser, but my QHF fund certainly is on a roll! It isn't saying a lot, but it is encouraging!

Regards,

Karel

[Karel]

Top 3: VOLV, VSEA and CHAP

Finally some time to work again at the fund, QHF. The week was rather good, and QHF again jumps over QQQQ. Warning! The numbers for the ETF's are off, as I added in over a year of dividends. So no pretty colors this time:

IWM: 28.38 (+2.2%)
SPY: 27.31 (+2.4%)
QHF: 26.01 (+2.2%)
QQQQ: 25.53 (+0.6%)
QHF-: 24.81 (+2.2%)

QHF- is the new baseline port, ... well, I guess you will know that by now.

This week's hall of fame: DRQ +7.5%, GEO +6.8%, and TSO +5.6%
Hall of shame: GNK (my latest pick, ticker changed from GSTL) -3.8%, WCG -1.1%, and GRMN -0.9%

The new Top 3 Picks are VOLV, VSEA and (again) CHAP. Do we need a new stock for QHF? Yes, we do. Currently there are 3 stocks due for replacement and the one that has been waiting longest is GI. It will be replaced by VOLV.

IBCA was sold (some weeks ago) for 29.29, a disappointing -35% loss in almost 9 months. GNK, then GSTL, was bought for 33.32.

The baseline port loses 3 ancient stocks and gets our new Top 3 Picks, that is, because CHAP already is in the port, we grab ORH in its place.

QHF Closed Trades:
Winners: 33, avg +80.0%
Losers: 15, avg -25.3%
Total: 48, avg +47.1%

Regards,

Karel

[spikefader]

Karel, well done!

Folks, in case you haven't noticed, Karel's method produces great results. Here is his equity curve based on those numbers:

[Karel]

Well, the ride was a bit wilder than that:


Orange is my fund
Green is SP500
Blue is Nasdaq
Olive is DJIA
Purple is the Marketocracy M100 fund.

Regards,

Karel

[Karel]

New Top 3: WCG, RKT, OMRI

The market is rolling, and the fund is rolling too. QHF, my marketocracy fund, performed quite well:

IWM: 28.75 (+1.3%)
SPY: 27.94 (+2.3%)
QHF: 26.53 (+2.0%)
QQQQ: 25.96 (+1.7%)
QHF-: 25.25 (+1.8%)

This week's hall of fame: GNK +13.5%, GGB +5.5%, and RKT +3.7%
Hall of shame: TSO -2.6%, PBR -1.7%, and TS -1.3%

The new Top 3 Picks are WCG, RKT and OMRI. Do we need a new stock for QHF? Yes, we do. Currently there are 2 stocks due for replacement (we are getting on top of things!), and the one that has been waiting longest is TS. Because 2 of the new top 3 are already owned, I chose between AKH, OMRI and EMS, and I picked AKH.

GI went for 29.29, a lackluster +7.7% gain in over 14 months. VOLV entered the fund at 87.78.

The baseline port sheds CHAP, CPA, and XING from februari 7th, and would get our new Top 3 Picks, but since we need to dig down to avoid stocks already held, the replacement stocks become: AKH, OMRI, and EMS

QHF Closed Trades:
Winners: 34, avg +77.9%
Losers: 15, avg -25.3%
Total: 49, avg +46.3%

Regards,

Karel

[billyjoe]

Karel,
We must have some similarities in our screens. Just ran some (see Pete's thread) Final 32 stocks included AKH BW GEO SPAR UCTT, and WCG.
In fact, BW GEO SPAR UCTT and WCG were all in the final 9.

------------billyjoe