An Infrastructure Rebuttal

Subsequent to the US election, many have pondered the impact to the economy at-large or at a micro level.  Consider Cramer’s Trump stocks or the Trigger app as examples.  I too have not been immune as I bought into Europe, Canada, Mexico and Australia as presidential comments resulted in temporary pricing weakness.  The question remains what – if anything – can be accomplished on his agenda. With healthcare and tax reform fraught with partisan politics, it appears the best option of the remaining campaign promises is infrastructure as on the surface there still is the hope of bi-partisanship.  Yet aside from a vague “public-private” partnership, details have been lacking probably due to resources allocated to the aforementioned agenda items.

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Rolling Unabridged Update #3

The fourth month of the Rolling Unabridged Monthly Portfolio (RUMP) is in the books with the results posted a few days ago.  A few were added and more removed.  The only item of note was that KO has tied JNJ in the overall rankings.  The update cycle remains at an eight month lag which is within the desired 6-9 month window.  Following are the highlights, findings, questions and issues identified.

Blog Composition

Bloggers with online portfolios that are not dormant numbered 266 this round.  Roughly 4 were added and 22 dropped due to dormancy, one by making their portfolio private and one by becoming subscription only.

Data

As alluded to earlier, there were no significant changes in the rankings, however both KMI and PM were replaced by OHI and WFC respectively, both of which were recipients of blog chatter leading into the US election.

Strategy

One thing that has caught my attention with these analyses is the multiple strategies employed whether singularly or in combination.  One that I hadn’t seen since 2000 was concentrated IPO investing.  As both dividends and profits rare in this space, his decision to eject his DGI safety net and go ‘all-in’ is one gutsy call.One can only hope his success – or timing -is better than my dabbling at the height of the dot-com bubble.

A Deeper Dive

I have come to the conclusion that this type of analysis – although interesting – is meaningless.  Adam’s data (I Want to Retire Soon) is distorted by frequency while mine is distorted by weighting (or lack thereof).   Meaning in my data, one share of JNJ is equal to 100 shares as the holding – rather than quantity – is paramount.  Therefore I miss weighting changes as the company is either owned or not.  Since a clearer picture cannot emerge, I’ll continue to periodically update the data but only post on major events such as dividend cuts.

Rolling Unabridged Monthly Portfolio

It seems that at times I seem to be a little late to the party. In late 2013, I stumbled across investment blogs and the DGI community in particular. With a knowledge of databases, I began to enter blogs I encountered into a table followed shortly thereafter by their holdings in another table. Obviously Ferdi (DivGro) had a similar thought as in February 2014 he presented the initial Blogger’s Portfolio. Initially 31 stocks within 20 portfolios, it was subsequently expanded to its’ current form of 60 companies within 43 portfolios.

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Conspiracy Theories

Two of the investing kingpins are in the news this week for different reasons.  Warren, obviously, for his annual meeting.  Carl, on the other hand, stole some of the thunder with his announcement yesterday that he exited his Apple position.  I’ll get back to Warren in a minute, but over the years have come to realize that rarely is a given act random.  Most times it’s calculated, particularly when significant amounts of money are at stake.  So I look for the hidden agenda, or for lack of a better term, the Conspiracy Theory.

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Crisis Management

Not to belabor a beaten down topic, but as we all know the story – and in many instances rehashed – versions of the Kinder Morgan fiasco and the subsequent fallout.  A perspective I haven’t seen addressed is human nature.  In a previous life, a role I held was to design and create contingency plans for telecom networks  – and subsequently data centers – in the event of a major outage.  The obvious corollary being a massive dividend cut (i.e., catastrophic failure).

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2015: What Went Wrong

This is the final segment to the best and worst of 2015. This series was inspired Bespoke Investment Group’s article tailored to actual holdings in DGI portfolios. The first post, 2015: What Went Right can be found here.

Again I need to address the caveats:

  • Only publicly disclosed data culled from portfolios in my Blog Directory were used. If your blog is not listed, your data was not included.
  • My data only reflects a snapshot in time. Once entered in my database I generally make no updates.
  • I make no guaranty as to the accuracy of the data either through input errors, processing errors, or the legitimacy of the source data. Meaning, use at your own risk – or you get what you pay for.

Bespoke’s article raised a number of questions in my mind. Although not specifically targeted to the DGI community, I found it to be timely none-the-less. So the question today is why were so many ‘losers’ contained in DGI portfolios?

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