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portefeuille (99.66)

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January 09, 2011 – Comments (36)

Why starting to "follow my calls" (or continuing to do so) might be a good idea.

My "virtual hedge fund" (see here) is currently in the green by around  63.5% since initiation on March 8, 2010. It has been pretty well diversified over that period. It does use some "leverage" but also some "hedging" making it not "overly risky" ...

Following my portfolio trades (see here) would have yielded "similar results" over the March 8, 2010 - January 7, 2011 period. With a similar "risk profile".

The best (performing) hedge funds (over "longer time periods") are "quant funds", and the best of those (1,2,3,4) is managed predominantly by PhDs in mathematics and theoretical physics (not sure how many of those are from Germany, hehe ...).

One of the most successful hedge fund strategies (again over "longer time periods") is "event driven investing" which is also the strategy my "fund" predominantly uses.

My 12 "caps" game players are shown here. At least some of them appear to know what they are doing, hehe ...

http://caps.fool.com/tag/biotechnology.aspx

http://caps.fool.com/tag/healthcare.aspx

http://caps.fool.com/tag/information-technology.aspx

http://caps.fool.com/tag/computers-and-peripherals.aspx

http://caps.fool.com/tag/electronic-equipment-instruments-and-components.aspx

http://caps.fool.com/tag/technical-instruments.aspx

http://caps.fool.com/tag/financials.aspx

http://caps.fool.com/tag/financial-services.aspx

http://caps.fool.com/tag/bank.aspx

http://caps.fool.com/tag/money-center-banks.aspx

http://caps.fool.com/tag/international-stock.aspx

http://caps.fool.com/tag/germany.aspx

http://caps.fool.com/tag/switzerland.aspx

http://caps.fool.com/tag/united-kingdom.aspx

http://caps.fool.com/tag/russia.aspx

http://caps.fool.com/tag/italy.aspx

http://caps.fool.com/tag/israel.aspx

http://caps.fool.com/tag/australia.aspx

http://caps.fool.com/tag/sp-500.aspx

http://caps.fool.com/tag/defensive.aspx

http://caps.fool.com/tag/dividend.aspx

http://caps.fool.com/tag/cyclical.aspx

http://caps.fool.com/tag/mega-cap.aspx

http://caps.fool.com/tag/rule-breakers-universe.aspx

http://caps.fool.com/tag/buffett-stock.aspx

36 Comments – Post Your Own

#1) On January 09, 2011 at 1:00 PM, CCLEGG (< 20) wrote:

Port

I'll give ya a pat on the back!

I've enjoyed "the chart" been fun to watch it track. picked up a few small orders of some of your picks.

Thanks Cam

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#2) On January 09, 2011 at 1:08 PM, portefeuille (99.66) wrote:

There is no "secret formula" involved in all this, I almost never use any "screens" or look at the details of balance sheets, I don't pay attention to "insider action", rarely read research reports and the events in the "event driven strategy" are usually entirely obvious. There is no "core strategy" that could be reverse engineered and I think I would simply waste my and every reader's time if I started to give elaborate "explanations" of the "reasons for doing a certain trade".

I do think that I am pretty good at noticing when someone else knows what he is talking about, which is why I do pay attention to what zzlangerhans writes.

An uncle of mine is a professor of economics and he mentions every now and than how amazed he is at how much people enjoy talking about subjects they know nothing about (especially about "economics related subjects"). As a theoretical physicist or mathematician you are usually relatively save form being confronted whith people that talk about "your specialty" ...

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#3) On January 09, 2011 at 1:09 PM, portefeuille (99.66) wrote:

than

then

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#4) On January 09, 2011 at 1:20 PM, portefeuille (99.66) wrote:

someone else

someone

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#5) On January 09, 2011 at 2:52 PM, checklist34 (99.73) wrote:

you are describing kind of what I said in early 2009... 

That that was not the time to overthink anything, but rather the time to think simply and make choices based not on deep thought and extreme analysis (because, then, everything looked ugly somewhere) but to just use simple thoughts like "dow chemical is the biggest baddest company in the world, its not going to go broke for gods sake".  

where was your fund at jul 1, 2010?

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#6) On January 09, 2011 at 4:01 PM, dragonLZ (99.33) wrote:

Congrats Porte and Good Luck in the future.

rec #5

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#7) On January 09, 2011 at 4:50 PM, TMFCrocoStimpy (88.80) wrote:

Quite impressive Porte - congratulations.  I'm performing a risk analysis of the portfolio based on the trading data you supplied thru Dec 30, 2010, and just wanted to confirm that you started the account with $3.4M USD as your virtual seed money on March 8, 2010?

Keep it up!

-Stimpy

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#8) On January 09, 2011 at 5:15 PM, anchak (99.86) wrote:

Great Job Hans!

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#9) On January 09, 2011 at 5:16 PM, anchak (99.86) wrote:

Hey did you get checklist's email - or provide him with mine?

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#10) On January 09, 2011 at 5:51 PM, MegaEurope (20.55) wrote:

portefeuille (99.94) wrote: I think I would simply waste my and every reader's time if I started to give elaborate "explanations" of the "reasons for doing a certain trade".

I disagree (at least on it wasting my time).

I would like to follow your calls but the explanations haven't been quite enough to draw me in.  (Unlike for example TMFDeej or Jakila. Despite weaker short-term performance compared to yours, I would follow them into a trade more willingly because of their thorough analysis.)

Anyways congrats on your performance so far and good luck.

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#11) On January 09, 2011 at 5:54 PM, portefeuille (99.66) wrote:

#6The fund was in the red by around 26% on July 2, 2010 (see comment #250 here). I think it was slightly lower on July 6, 2010. It was in the green by around 70% on January 6, 2011. So it went from around 0.74 to around 1.7 (-> ≈130%) in a little over 6 months.

#7 Yes, start with 3.4 million VUSD on March 8, 2010.The first few trades are not well documented though (see the posts linked to comment #1 here) as they were my "contribution" to the "tigerpack fund" thing. I got kicked out after a week or so because I traded too much, hehe ...

#9 No, I could not find yours.

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#12) On January 09, 2011 at 6:02 PM, portefeuille (99.66) wrote:

save

safe

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#13) On January 09, 2011 at 6:09 PM, Valyooo (99.48) wrote:

Do you use TA or common sense or seasonal patterns most? Or none?

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#14) On January 09, 2011 at 7:00 PM, portefeuille (99.66) wrote:

I use almost no TA, no "common sense" and don't look at "seasonal patterns".

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#15) On January 09, 2011 at 7:20 PM, anchak (99.86) wrote:

Ok... I will email you tonight..hopefully you haven't changed yours!

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#16) On January 09, 2011 at 8:44 PM, zCreator (95.22) wrote:

My guess is you're using a momentum based system where you categorize the security based on some criteria and give it an up or down thumb within one of the twelve portefeuille accounts and based on performace compared to the s&p 500 actually add it to your real life account? Even if I'm totally right (though I highly doubt it) about how you're doing it, it's still very impressive returns. I only made 30% in 2010 for my real life portfollio.

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#17) On January 09, 2011 at 9:22 PM, Bays (30.09) wrote:

" I only made 30% in 2010 for my real life portfollio."

I wouldn't be disappointed with that return, as you probably beat a very large percentage of professionally managed funds.  

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#18) On January 09, 2011 at 10:06 PM, zCreator (95.22) wrote:

Well a man can dream about those 10 baggers...

 Thank you Bays for reminding me to be thankful for what I have.

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#19) On January 09, 2011 at 10:24 PM, rexlove (99.56) wrote:

I wanna give you a rec for the shortest title I've seen for a blog. 

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#20) On January 10, 2011 at 12:36 AM, checklist34 (99.73) wrote:

porte, thats the kind of way my real life portfolio has performed, substantial drawdowns and enormous outperformance on the way up...  I have been kind of thinking thats too stressful and wanting to accomplish similar alpha with less beta. 

 

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#21) On January 10, 2011 at 12:41 AM, checklist34 (99.73) wrote:

zcreator, thats about what I made as well, i did not perform well on the year relative to expectations for myself.  oh well

on the subject of 10 baggers, however, I have had a few since startinginvesting in jan 2009, including

BZ, LVS (20 bagger, almost 30, for cheapest shares), ASH, ACAS, MCGC, JOEZ, TCK (20 bagger for the cheapest shares), GGP (40 bagger) , GNW,CEM

ALD is very close.  XL and HIG will 10 bag for me someday.  So thats 12, maybe 13.  All from buying the dip, NONE from forseeing a big future trend or finding a young company that grows.  

It can happen, but I wouldn't be surprised if it takes 20 years or mroe to get 12 more ten baggers.  Early 2009 was a once in a lifetime thing, and if it wasn't for a large number of rookie mistakes, my overall return from then would be alot better than the nearly 5x it is.  

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#22) On January 10, 2011 at 12:12 PM, portefeuille (99.66) wrote:

My guess is you're using a momentum based system

I don't use a momentum based system. I do "catch falling knives" quite a few times, which is anti-momentum trading, I guess, hehe ...

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#23) On January 10, 2011 at 12:19 PM, Momentum22 (29.58) wrote:

wanting to accomplish similar alpha with less beta

: )

...the holy grail. I need some!

Congrats Porte! Keep it up...I was about 26% in 2010 but I deployed quite a bit of new capital into the May correction.  So while it was good for the account it was not as good a relative return. And certainly not as good as yours...

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#24) On January 10, 2011 at 12:54 PM, zCreator (95.22) wrote:

@21: INVU :)

@22: I see... but wouldn't you watch the momentum for sell decisions? As strength weakens on the uptrend? No?

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#25) On January 10, 2011 at 1:14 PM, portefeuille (99.66) wrote:

#24 No, I don't look at "strength".

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#26) On January 10, 2011 at 3:02 PM, zCreator (95.22) wrote:

@25: Hmm... can I ask, what do you look at? I look at weekly and monthly charts for buy/sell positions and choose securities based on valuation. Could you provide a few crumbs of knowledge? :)

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#27) On January 10, 2011 at 3:49 PM, portefeuille (99.66) wrote:

#26 Maybe the best category would be "multi-strategy". There is no algorithm I follow.

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#28) On January 10, 2011 at 5:39 PM, zCreator (95.22) wrote:

I see... Thank you for the reply.

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#29) On January 10, 2011 at 7:22 PM, rfaramir (29.41) wrote:

Maybe just the details on each investment? No big strategy, if you don't have one, but what struck you when you made the pick, what should a follower look for to get out in case either a goal is reached or a requirement not met.

I've really liked reading UltraLong (now with a TMF prefix) because of how quick and simple and fast he evaluates companies. I can actually follow along and can get a sense of agreement or disagreement because of the specifics he cites. So far yours, though performing very well (congrats on that and toot your horn! you deserve it!), are hard for me to understand. Mostly for lack of expression, I think, on your part, and partly on lack of knowledge of specific industries on my part, like biotech, healthcare, and financials.

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#30) On January 10, 2011 at 7:53 PM, Momentum21 (42.25) wrote:

This would be my simplified version of his algorithm: 

He follows sectors that he feels have a high degree of promise/growth: (like biotech/cloud computing/LED) and looks for companies that might outperform based on expert opinion from a variety of sources.

He would also look for the impact of a specific event (BP Spill) and how that might impact the value of companies that may not be as bad as they appear (ATPG).

In biotech he would pick an unloved subset like RNA interference and create a basket of downtrodden tickers that are most likely to survive. Most will underperform but the premise is that the reward across the basket will outweigh the inherent risk of the sector due to the multi-bagger potential of a breakthrough.

I love the style and passion.

You can't go 10 minutes without talk about spending 12 hours with a financial statement but why do it unless you enjoy it? If you don't love it just about everyone else in the world is doing it better...so you would be better off just guessing. At least then you might not be so sure of yourself when you made the investment and could get out quicker. 

Porte spends a great deal of time on research but it probably doesn't feel like a grind to him.

The key is having the confidence to weather the storm when you sit 30% in the hole...which can happen quickly when you mess with high volatility.

I would check out some of his threads (and spend some time with them) and you can get a good idea of the style. It is like a soap opera, you kind of need to follow along to get what's going down.  

 

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#31) On January 10, 2011 at 10:13 PM, portefeuille (99.66) wrote:

No big strategy, if you don't have one

multi-strategy, not no strategy, hehe ...

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#32) On January 10, 2011 at 10:24 PM, portefeuille (99.66) wrote:

I guess part of my "tactics" are laid out in comment #30 ...

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#33) On January 12, 2011 at 4:07 AM, Hotpicks101 (29.23) wrote:

Great stuff porte. Really, really impressive results. You should look into creating some sort of real hedge fund. I sure wouldn't mind throwing you a little real money with returns like that.

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#34) On January 12, 2011 at 4:03 PM, portefeuille (99.66) wrote:

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#35) On January 12, 2011 at 5:18 PM, iam2bz2p (35.93) wrote:

THANK YOU Portefeuille for your hard work and simply outstanding communication and transparency. I'm a new investor, but I'm watching and learning.

 

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#36) On January 12, 2011 at 5:22 PM, djshagggyd (70.57) wrote:

Port-

I've learned a lot from you since I joined CAPS. Congrats on your continued success!

~justin 

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