Performances of my first book on this series
Performances are measured by the
average return of all the stocks in the recommended lists. To illustrate, the
average return of 2 stocks with one 40% and one 10% is 30%. Commissions and
dividends are not included for simplicity. Survival bias (stocks having been
merged or deleted from the database) is ignored for the short period.
Annualized Return
It is used for better comparison.
However, I try to skip annualized returns for less than 10 days as it would
detort the results. The annualized return is a double-edge sword. It amplifies
the result in either direction.
If you have 3 test returns: 10%
in 2 years, 10% in 1 year and 10% in 6 months. It appears they are the same.
However, the annualized return tells the right story. They are 5%, 10% and 20%
respectively for the 3 test results.
Beat SPY by
In addition, beating SPY (an ETF
simulating S&P 500) is a good yardstick on how the selected stocks perform.
My returns do not include dividends, commissions and bid spreads. In the past
few years, SPY is harder to beat than S&P500 as it has many successful
FAANG stocks. Their successes may change.
Ask any mutual fund manager how
his/her career would improve by beating it by 5%. Beating it by more than 5% is
huge. It may not be sustainable in the future and past performance has nothing
to do with future performance. But, the last selection did.
Beat SPY = (Avg. Return – SPY
return) / SPY return
Performance of my book “Best Stocks 2014 According to me”
This is my first book from my
memory published in Dec. 16, 2013. Here is the performance from Dec. 16, 2013
to June, 16, 2014, 6 months away.
|
|
Ann. %
|
SPY%
|
Beat SPY by
|
|
All stocks
|
77%
|
34%
|
126%
|
|
Sub lists:
|
|
|
|
|
Conservative
|
79%
|
34%
|
132%
|
|
Risky
|
97%
|
34%
|
185%
|
|
Riskiest
|
46%
|
34%
|
35%
|
The
average return of the list of the Riskiest Stocks does not perform well
relative to the other two lists. In the future book, most likely I will
eliminate the list of Riskiest Stocks and keep the number of stocks to around
100. At the meantime, select the stocks in the first two lists, which have better
performances.
Performance of my book “Best Stocks for 2020”
This book recommends stocks for
the entire year from 2019 to the end of 2019. This book was published in May
24, 2019. Here is the performance from May 24, 2019 (the publish date) to June 24,
1 month later.
|
|
Ann. %
|
SPY%
|
Beat SPY by
|
|
All stocks
|
65.73%
|
45.25%
|
45%
|
I put money where my mouth is.
Ask any subscription service whether they invest in their own recommended
stocks, dates of purchases and the performances. You can cheat with daily price
fluctuations and many other tricks, but not in a real portfolio from a broker.
Here our mine of the recommended stocks from this book above. The current
prices are based on today’s date (6/28/2019).
|
Stock
|
Buy Date
|
Return
|
Ann Return
|
|
COP
|
05/29/19
|
3%
|
41%
|
|
LUV
|
05/24/19
|
-1%
|
-12%
|
|
ORCL
|
05/28/19
|
7%
|
81%
|
|
|
|
|
|
|
Avg.
|
05/27/19
|
3%
|
37%
|
|
|
|
|
|
