Portfolio 701: Up And Running
January 8th 2007 09:24
With the success of Portfolio 1.5 - EW*, formed and observed since August, 2006, Benkaiser.NET Investment Portal formed another portfolio, Portfolio 701*, with shares selected between the period mid-November and December, 2006, based on the same factor, "fundamental technicality" employed in Portfolio 1.5 - EW.
The fundamental technicality factor was used to select the shares during the period mentioned. A total of 102 shares were selected and by 5th January, 2007, only 35 stocks remained in the watch after a round of elimination. The final 35 stocks were picked based on thier positive momentum observed from mid-November to December, 2006.
Unlike the previous portfolio, Portfolio 701 will be analysed with share profiles such as P/E ratio, P/B ratio, market capitalisation, industries and the beta variable. This is to further identify whether certain characteristics combined with the fundamental technicality factor could produce better performance as compared to the market index and Portfolio 1.5 - EW, which did not take into account of any other factors or characteristics.
The previous portfolio managed to top a record return of 40.58% to date.
All the 35 shares were "virtually" purchased on the 5th January, 2006 closing prices and therefore on the 8th January, 2006, is the first day of observation for the forward one month to three months. The observation period will be extended when necessary.
Also in the pipeline is the prospect of portfolio rebalancing when the need arise, as such, Portfolio 701 will be considered a rather mild active portfolio as compared to the completely passive Portfolio 1.5 - EW.
The following table shows the 35 stocks in the portfolio.
The table above also show the type of industries each shares belong to. In summary the industries are:
Materials
Real Estate
Energy
Technology
Consumer Discretionary
Software
Automobile and Parts
Retailing
Financials
Capital Goods
Health Care Equipment
From casual observation, majority of the 35 shares are nano-caps with a few small-caps and one mid-cap. In addition, more than 70% of the shares are under $1.
The portfolio has a purchased value of $51,420. The first closing value observed today is $53,200 and after-cost profits at -$1,780. A transaction or brokerage cost of $30 was used for each share transaction (purchase) to reflect the portfolio in a more realistic setting. The portfolio closed -1.40% lower.
Ultimately, the first objective of this portfolio is to verify whether the fundamental technicality factor is indeed a working variable as an efficient and practical investment strategy that can be replicated. Last but not least, the second objective is to explore how to enhance the strategy, analysed with the share characteristics, if the first objective was satisfied.
** Stay tune for more.
*Disclosure
NOT SPECIFIC INVESTMENT ADVICE
This information has been prepared for distribution over the internet and without taking into account the investment objectives, financial situation and particular needs of any particular person.
The blogger makes no recommendations as to the merits of any investment opportunity referred to in its website. It is advisable to obtain specific investment advice before making anyinvestment decisions relying on the information provided. While the information available in this publication is obtained from sources believed to be reliable, the blogger gives no assurances or guarantees that the information is accurate, complete or current.
The information is provided for informational purposes only and not intended to constitute legal, financial or professional advice. It has no regard to the investment objectives or circumstances (financial or otherwise) of particular recipients, and is not an exhaustive outline of available investment opportunities.
Appropriate professional advice should be obtained prior to acting on any information contained in this publication. The blogger will not be liable for any loss or damage incurred by any person directly or indirectly as a result of reliance on the information contained in this publication.
PAST RESULTS
Any past results shown or mentioned in any of our reports or web pages do not guarantee future performance.
ACCURACY OF DATA
Whilst all information on this site is believed to be accurate, we take no responsibility and give no assurances that it is accurate. We advise that you to double check any
data before acting upon this information.
The fundamental technicality factor was used to select the shares during the period mentioned. A total of 102 shares were selected and by 5th January, 2007, only 35 stocks remained in the watch after a round of elimination. The final 35 stocks were picked based on thier positive momentum observed from mid-November to December, 2006.
Unlike the previous portfolio, Portfolio 701 will be analysed with share profiles such as P/E ratio, P/B ratio, market capitalisation, industries and the beta variable. This is to further identify whether certain characteristics combined with the fundamental technicality factor could produce better performance as compared to the market index and Portfolio 1.5 - EW, which did not take into account of any other factors or characteristics.
The previous portfolio managed to top a record return of 40.58% to date.
All the 35 shares were "virtually" purchased on the 5th January, 2006 closing prices and therefore on the 8th January, 2006, is the first day of observation for the forward one month to three months. The observation period will be extended when necessary.
Also in the pipeline is the prospect of portfolio rebalancing when the need arise, as such, Portfolio 701 will be considered a rather mild active portfolio as compared to the completely passive Portfolio 1.5 - EW.
The following table shows the 35 stocks in the portfolio.
The table above also show the type of industries each shares belong to. In summary the industries are:
Materials
Real Estate
Energy
Technology
Consumer Discretionary
Software
Automobile and Parts
Retailing
Financials
Capital Goods
Health Care Equipment
From casual observation, majority of the 35 shares are nano-caps with a few small-caps and one mid-cap. In addition, more than 70% of the shares are under $1.
The portfolio has a purchased value of $51,420. The first closing value observed today is $53,200 and after-cost profits at -$1,780. A transaction or brokerage cost of $30 was used for each share transaction (purchase) to reflect the portfolio in a more realistic setting. The portfolio closed -1.40% lower.
Ultimately, the first objective of this portfolio is to verify whether the fundamental technicality factor is indeed a working variable as an efficient and practical investment strategy that can be replicated. Last but not least, the second objective is to explore how to enhance the strategy, analysed with the share characteristics, if the first objective was satisfied.
** Stay tune for more.
*Disclosure
NOT SPECIFIC INVESTMENT ADVICE
This information has been prepared for distribution over the internet and without taking into account the investment objectives, financial situation and particular needs of any particular person.
The blogger makes no recommendations as to the merits of any investment opportunity referred to in its website. It is advisable to obtain specific investment advice before making anyinvestment decisions relying on the information provided. While the information available in this publication is obtained from sources believed to be reliable, the blogger gives no assurances or guarantees that the information is accurate, complete or current.
The information is provided for informational purposes only and not intended to constitute legal, financial or professional advice. It has no regard to the investment objectives or circumstances (financial or otherwise) of particular recipients, and is not an exhaustive outline of available investment opportunities.
Appropriate professional advice should be obtained prior to acting on any information contained in this publication. The blogger will not be liable for any loss or damage incurred by any person directly or indirectly as a result of reliance on the information contained in this publication.
PAST RESULTS
Any past results shown or mentioned in any of our reports or web pages do not guarantee future performance.
ACCURACY OF DATA
Whilst all information on this site is believed to be accurate, we take no responsibility and give no assurances that it is accurate. We advise that you to double check any
data before acting upon this information.
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Comment by aw
Also, what is the criteria for the rebalancing? Every timed period (monthly etc), or once a certain return is expected? Thought it would be better qualitatively if it's specified at the start.
Comment by Benjamin
Benkaiser.NET Investment Portal
The criteria for rebalancing mainly depends on any changes in the factor. For instance if the factor sustained a negative turnaround then it is a signal for selling and vice-versa. And of course, any market moving news or information affecting the portfolio shares would be taken into account of. Therefore there are no fixed schedules for rebalancing.
As for the methodology, perhaps I would need to consult with laywers first regarding my intellectual property rights. Just kidding. The second round is crucial for finding out whether the factor works, so it is not the time yet, mate.
Anyway thanks for visting
Cheers
Ben