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The search for the golden ticket continues.

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October 25, 2010 – Comments (21)

It's been a while since I have updated my picks here on Motley Fool.  However, after a very long weekend (probably 20+ hours working on updating my model in the last 2 days alone) I am back in business.  I am proud to say that it is now based on 10 years of quarterly data and includes a seasonality test and adjustment.  You will notice that I ended 81 picks late last night and replaced them with 81 new ones directly from my model.

I also finished my consumer sentiment driven forecasting machine which is based on the revolutionary computonian law of probability.  I forecast that I will be publishing a few graphs from that in the next day or two for testing purposes. 

Finally, I hope to add some real money picks today to my portfolio based on the two above mentioned tools.

21 Comments – Post Your Own

#1) On October 25, 2010 at 11:08 AM, dragonLZ (99.39) wrote:

Good luck, anticitrade.

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#2) On October 25, 2010 at 12:21 PM, TMFCrocoStimpy (95.18) wrote:

Welcome back anticitrade - good to see you blogging again.

-Stimpy

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#3) On October 25, 2010 at 2:19 PM, Merxy (< 20) wrote:

How can you base your analysis and seasonal predictions when it's clear that we've changed as a whole. I doubt The same stocks 8 years ago are going to be the golden ticket today. Nor will commodities. I feel that what you should do is use the 52wk data and break down what will be prosperus in the situation. I understand I am new but you aren't going to make your "golden ticket" trading Krispy Kreme donuts.

 

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#4) On October 25, 2010 at 2:19 PM, Merxy (< 20) wrote:

How can you base your analysis and seasonal predictions when it's clear that we've changed as a whole. I doubt The same stocks 8 years ago are going to be the golden ticket today. Nor will commodities. I feel that what you should do is use the 52wk data and break down what will be prosperus in the situation. I understand I am new but you aren't going to make your "golden ticket" trading Krispy Kreme donuts.

 

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#5) On October 25, 2010 at 2:36 PM, anticitrade (99.60) wrote:

Merxy,

I don't fully understand your comment, but since you posted it twice, I figured I would try to respond to it. 

First:  I disagree that your comment "it's clear that we've changed as a whole" applies to the fundemental type investing I am working on.  The value of the basic DCF model I use should be unchanged by recent events.  A company is still worth the future value of it's free cash flows. 

Second:  I never said that the same stocks that were doing well 8 years ago, would do well today.  I am not a believer in technical analysis.

Third:  I am not even sure what "what you should do is use the 52wk data and break down what will be prosperus in the situation" means.

Fourth:  How did Krispy Kreme donuts become part of the discussion?

 

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#6) On October 25, 2010 at 4:59 PM, anticitrade (99.60) wrote:

Gold Price 8 month

This first forecast is of Gold prices in USD/ Ounce (http://www.research.gold.org/prices/

The R^2 is .86 with an 8 month forecast.  The 95% confidence interval is +/- 182. 

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#7) On October 25, 2010 at 5:12 PM, anticitrade (99.60) wrote:

Home building permits

The second forecast is of building permits for new privately owned housing untis (http://www.census.gov/const/www/permitsindex.html#estimates).

The R^2 is .97 with an 8 month forecast.  The 95% confidence interval is 18.

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#8) On October 25, 2010 at 5:29 PM, Option1307 (29.71) wrote:

Glad to see you're still around and doing well.

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#9) On October 25, 2010 at 6:07 PM, Bays (30.09) wrote:

Merxy,

Anticitrade uses models (ie. DCF) and investment strategies that have been proven successful for decades.  To say "that we've changed as a whole", and all of a sudden what worked in the past 100 years will not work now in the future is just plain ignorant.  

Do you know how many times weve "changed as whole" in the last 100 years?  Yet the same strategies have been proven successful time after time. Sure you can cherry pick and say Krispy Kreme may be a dud in the future, but notice how he has 81 picks?  What he has done has compiled a list of 81 companies that he feels should outperform the market as a whole, based on a model that has been proven successful by many investors in the past.

Anticitrade,

Keep up the good work, man.

 Cheers,

 

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#10) On October 25, 2010 at 6:22 PM, Momentum21 (89.50) wrote:

Great to see you back around...APT has caught my attention. 

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#11) On October 25, 2010 at 6:42 PM, anticitrade (99.60) wrote:

AAPL Stock Price

This is my third forecast (and final for today) based on my targeted sentiment tool.  I am HEAVILY suspicious of the prediction (I did 7 or 8 iterations, and this one is probably the best).  Because stock prices are influenced by a wide array of inputs, I suspect that my consumer sentiment predictions can only go so far.

I really hope to combine this with my standard anticitrade tool to match the hard fundamental numbers with the soft squishy consumer sentiment values.

Thanks for all the support everyone!  Tomorrow I really hope to get some real money trades made again!

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#12) On October 25, 2010 at 6:45 PM, anticitrade (99.60) wrote:

(I should mention that statistically my Apple stock price forecast has an r^2 of .93 and a 95% confidence interval of 40)

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#13) On October 25, 2010 at 7:05 PM, MegaEurope (< 20) wrote:

What data are these consumer sentiment graphs based on?  Are you using fractals/econophysics?

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#14) On October 25, 2010 at 10:14 PM, TigerPack1 (96.70) wrote:

You are too smart for the rest of us.  According to a different popular blog on CAPS the last few days, I shouldn't make any money in the stock market because of my low IQ... I guess wonders never cease!  LOL

-TigerPack

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#15) On October 26, 2010 at 2:36 PM, mikecart1 (98.91) wrote:

Welcome back bro.  I'm ready to make more money doing what you tell me to do! :D

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#16) On October 26, 2010 at 7:49 PM, LawfordCap (99.81) wrote:

Your models are doing really well.

Can you put up a scatter of predicted % change vs actual % change for each month?

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#17) On October 26, 2010 at 9:10 PM, anticitrade (99.60) wrote:

LawfordCap - Its good to hear from you again. I like your idea, but I am not sure how to implement it.  My traditional model has never included a timing element so I am assuming you are talking about my new sentiment driven one.

I am still testing it out, and I think I need to use it as to predict "alpha" rather than specific prices because the overall market moves can overshadow the impact of sentiment.  

Let me work on this for a little bit and see what I can spit out.  The advantage to the sentiment data is it is very easy to backtest.

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#18) On October 26, 2010 at 9:55 PM, anticitrade (99.60) wrote:

apple alpha

This is a demonstration of how the apple data looks if you evaluate it on "alpha" (compared to the S&P500) instead of stock price. Using weekly data instead of monthly, and looking 9 weeks out.

R^2=.87 and the confidence interval is +/- 6.45.

 

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#19) On October 28, 2010 at 7:17 AM, OfRelativeValue (24.47) wrote:

I am curious to how your model would rate MSFT or MDT?  I am a fellow value investor, these score very high on my free cash flow to price model.  Does your model rank the value picks?  Does the top 10 selections beat out the top 80 for performance?  A lot of questions, sorry about that but I am very interested in the ranking system you have developed.

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#20) On October 29, 2010 at 4:09 PM, anticitrade (99.60) wrote:

MSFT is a good company from a DCF basis (around 37.5), but less good on an enterprise value basis (around 20).  Sentiment also seems to currently favor them.

MDT is also a strong pick from a DCF basis (around 75), and I beleive I have owned them before. 

I suspect that your model likes them for the same reason mine does.  They are great companies, but in both cases when I look at them from an enterprise value things are quite as cheery (yet almost all my prices say that both these companies are undervalued).

I have found a pretty signicant performance stratification based on my rankings.  Check out this previous blog on that:

http://caps.fool.com/Blogs/evaluation-of-the-top-100/350788

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#21) On November 01, 2010 at 2:05 PM, joshuatree78 (< 20) wrote:

Does this mean your website is going to be back up soon?

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