Sunday, June 8, 2014

Beating the index so far this year

Both of my funds are substantially beating the index year to date. Index gain ytd is about 16%, but Im 28% in my main port and 36% in my nimble. And as of this time both have big cash positions.

Im not sure if I'll stay in this winning way throughout the year. But at least speaking for the period of the past 8 months, I think beating the PSEi was not that hard to do... as long as you really stuck with the companies that are fundamentally strong and showed good rebound as they did a year ago (say Q2 2014 vis a vis Q2 2013). The stocks that made me beat the index were concentrated positions on TA, AGI, MEG, TEL (and its big divs), DNL, and MBT. PGOLD was not a very hard pick to make as well, but my position here was small then I sold it also pretty quickly. Part of my education is in learning that one really does not need so many stocks in portfolio. If you gave 30% in TA, 30% in MEG, 30% in AGI, 10% to MBT (which has a low P/E for a top bank), and then made zero allocation to expensive and bland-performing SMPH and SM, you sure should also have beaten the index handily.

When I played with bazuras, mostly on small positions and for 'entertainment,' I made sure to sell already when I saw +10%. No need to be greedy. I profited from BHI, CPG, SGI, et al. On the reverse, on the losing side, I also cut generally on a Bazura when I see -6 or -7% and when the bid side is not getting any thicker. I usually sold on intraday rallies with these bazuras. I lost in LC, PX, ROCK which I all bought and sold inside a week.

In-and-out-in-two-to-three-weeks-after seeing-3.5%-8% gain is also effective in a volatile market. This helped late last year, especially. But the assumption here is that youll have time to "guard" your stocks and monitor the market. You need to see the buying side thinning to have an informed decision that the runup is probably getting weaker. Using this method, GTCAP gave me good profits 

Im seeing some newbies who relied on just RSI's on their first entries in SECB and other fundamentally-sound stocks. Im sure they also have beaten the index year to date. As long as they did not get greedy. 

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