My Picks For 2010 Are In!
The new year is upon us and, as such, I closed out all my 2009 CAPS picks and replaced them with my picks for 2010 (92 Outperform, 91 Underperform).
In this second year of my CAPS experiment, I upgraded my methodology (I think!) by preferring the cylically-adjusted P/E ratio to the forward P/E, despite the fact that the last year's results appeared satisfactory. In addition, instead of comparing valuations across all S&P 500 components, I looked at each primary sector in the S&P 500 seperately.
It will be interesting to see how the year treats me -- I have a feeling that my 2009 vintage was a heavy beneficiary of last year's "junk" rally and I think that has run its course. Of course, the change in methodology means this year's results won't be comparable to last year's.
On another note, for those who are interested in following/ commenting on my analysis on a different platform, I can now be found on Twitter.
Alex Dumortier, CFA