a contest

I’d like to propose a little contest, just for fun. If you had to put all your money into 20 stocks or ETFs or CEFs on January 3, 2017 and keep them there for one year, which would you choose? Eddy Elfenbein chooses 20 here: http://www.crossingwallstreet.com/buylist. His overall track record is pretty good but in 2016 he did very badly. I’ll post my list within the next week; all lists should be posted before market open on January 3. Liquidity limits: $50,000 ADT(60), 2 million float, price above $1.00. We’ll use opening prices on January 3, 2017, no slippage to keep things simple. Whoever comes out with the highest percentage increase by the opening price on January 2, 2018 wins. We can track winners monthly if we want to create a little suspense. I think P123 users have a distinct advantage over everyone else in the world here. I hope someone is interested . . .

Count me in, Yuval!
I’ll send you my list on 27 December.

OK, here are my twenty stock picks. I hope a few other folks will pick twenty as well and we can have a real contest.

  1. U.S. Auto Parts Network (PRTS).
  2. MPM Holdings (MPMQ).
  3. Wayside Technology Group (WSTG).
  4. inTest (INTT).
  5. Sterling Construction (STRL).
  6. Noodles & Co (NDLS).
  7. Christopher & Banks (CBK).
  8. Celestica (CLS).
  9. New York & Co (NWY).
  10. Bravo Brio Restaurant Group (BBRG).
  11. Hallmark Financial Services (HALL).
  12. Crawford & Co (CRD.B).
  13. Harvard Bioscience (HBIO).
  14. EXFO (EXFO).
  15. Points International (PCOM).
  16. Shiloh Industries (SHLO).
  17. Radio One (ROIAK).
  18. Neff (NEFF).
  19. Security National Financial (SNFCA).
  20. Cellcom Israel (CEL).

While Elfenbein picks big companies with strong earnings, I pick tiny companies with weak earnings. (Call me a contrarian.) These are companies that few people invest in. They have very low price-to-sales ratios—with two exceptions, their yearly sales exceed their market cap, and in fourteen cases are double. And only half of them are actually making money (i.e. have earnings per share greater than zero).

One thing Elfenbein and I have in common is that we like stable companies. When you’re investing in a company for the long haul, you want it to be stable. So I look for companies whose sales, assets, and other accounting metrics haven’t changed much from one year to the next.

The strategy I’m using to pick these stocks isn’t the same as the one I use for my personal investments, since I almost never hold onto a stock for a whole year. For those, earnings and free cash flow play a large part in my choice of stocks. To choose these, though, I disregarded everything earnings-related except for earnings growth and almost everything related to free cash flow. Instead I focused on low price, low volume, and accounting stability.

I’ll be incommunicado between Christmas Day and January 5. Please post your lists by the opening bell on January 3.

PPC
WFM
RMCF
TSN
SYY
CVS
MDLZ
WMMVY
NSRGY
NHTC
PEP
BG
DPS
SJM
LANC
TATYY
WMT
KMB
EPC
CL

Here are mine:

Ticker(“BEAT,BSTC,CETX,CRAI,CRHM,ENVA,HCKT,HMTV,ICFI,IPAR,KINS,LMAT,MYRG,NTIP,OEC,PMD,QCRH,SP,SPLS,WLDN”)

Ticker
1 AMRB
2 CAAS
3 CRAI
4 EXFO
5 FRBA
6 FSAM
7 GPRK
8 HCAP
9 HDSN
10 HIIQ
11 KEM
12 KINS
13 KVHI
14 LINC
15 MCFT
16 MRLN
17 PPSI
18 SRT
19 WHF
20 WLDN

AAPL,ALL,AMZN,AVGO,BAC,BGB,C,CRM,FB,GOOGL,HD,NFLX,NKE,NXPI,ORLY,RDN,SBUX,TSLA,V,Y

Thanks
Kumar

Sounds like fun. Count me in:

ACFC
ASRV
BYBK
CPSS
FBP
FNMA
LC
OCN
RBPAA
SNFCA
BDRBF
FCEL
IDSA
JASN
MARA
OESX
DYAI
GURE
IPI
TANH

Let the fun begin!

PIR
CVRR
OCFC
TLYS
CLMS
KVHI
FSAM
MRLN
FF
WNC
MC
NVMI
SAFM
TLRD
WEB
CASH
PEIX
ANW
MEI
KEM

This sounds like fun! Thanks for setting it up.

AXAHY
CAAS
AHL
CLS
KB
PRU
PKX
TX
KELYA
EBR
FCAU
OGZPY
ENIA
NOA
TRN
MGA
VLO
SNP
MTOR
CPSS

Here you go:

Bfr
Bma
Brss
Bwxt
Cinr
Cpla
Dq
Fbiz
Fly
Hsni
Klic
Lby
Mbt
Merc
Nap
Omab
Ruth
sbr
Tx
Ueps

I wouldn’t put much if anything in these. I don’t think one year hold on 20 positions means much at all, but let’s see what happens.

From a speculative trading perspective, could also look at momentum trading systems in bitcoin (gbtc).

Eifenbein picks almost exclusively S&P 500 stocks. Thus, his benchmark choice.

I’d be in favor of a S&P 500 contest.

There are nearly 4500 US stocks that comply with OP’s generous liquidity “constraints.”

Not interested in this contest. But the benchmark needs to be the Russell 3000 equal weight, and if that doesn’t exist, then 2*Russell 2000 EW + Russell 1000 EW. Total return.

I suggest that you guys each set up a port with your choices. You can do this with an inlist called up as the buy rule with rebalance of one year. This way you can track and compare with others instead of listing the picks in a post.

Steve

Spot on, Steve! We will indeed track performance with live ports. What are your 20 picks?
Happy 2017!

I am not good at this kind of stuff but since this is for fun here is my totally speculative list:

AAL CLD CR CUBI ERA FMBI GBX GPRE ITT LTXB MTRX PNFP RIG SIVB TRN TXT UCBI UMBF WNC WTFC

These are all stocks from S&P 1500.
Best of luck to all for 2017 real investments (more important) & the contest (less important).

KJ

One more list. I like this one better. These are all stocks doing more than $2mm avg daily trading volume over 100 days with mkt cap greater than $200mm and close > $5 (about 2800 stocks).

They are then trimmed to the hundred strongest companies based on classical company strength measures, then ranked on quant versions of many very traditional fundamental bottom up factors.

Many screen factors used to remove ‘dogs’.

Fundamental approach of finding good companies and then buying the cheapest among them.

If run a rolling advanced screener backrest, running each mon with 1 year hold, it shows an average return of 16%, and typicallly outperforms the sp500 by 8 to 9%, doing slightly better in down markets. Peak dd for this was 42% over historical period. But it underperformed in around 40% of the periods, as will happen with any long hold smallish portfolio.

It’s a pretty good starting point for fundamental analysis though.

Idcc,
Nwli,
Htbk,
Pfbc,
Omab,
Nhtc,
Htlf,
Sbs,
Cbpo,
Amat,
Jcom,
Uthr,
Swhc,
Bstc,
Selg,
Anik,
Wal,
Gntx,
Bncn,
Ppbi.

The winner of this contest will mostly be luck, but may spur interesting ideas.

What type of company would you hold for one year…

Best,
Tom

My List: (One Edit)

ASBB
BRK.B
CPS
EBMT
GE
HIFS
ISRG
JNJ
KEQU
LH
LMT
MGLN
MLVF
NUTR
NVR
NWLI
SAR
SJW
WBA
WBKC

Steve

Okay,

Last list. System creates a list of 500 stocks (using quantitative rules only) to filter out ‘bad companies’. The system them ranks the remaining stocks using quant analysis (mostly value and quality factors from bottom up analysis).

All of these below stats are based on running advanced screener every month, holding for 12 months over the 1999 to 1/2017 period.

This system beat the benchmark 71% of the time and returned a positive amount 81% of the time. Largest 12 month loss was 42% over backtest period.

Here are the summary stats for this system running rolling backtest every month with 1 year hold.
Average 20 18.19% 9.97% 8.21% -41.33% 102.05% 35.28%
Up Markets 165 20 26.50% 18.42% 8.09% -33.13% 113.79% 36.63%
Down Markets 57 20 -5.90% -14.47% 8.58% -65.06% 68.06% 31.36%

Liquidity:
AvgDAilyTot(100)>2000000 and close(0)>2 and MktCap>100
&
Forder(“MktCap”)<2000

So, all stocks should be in the top 2000 of stocks from all fundamental universe in terms of market cap.

Given the nature of this ‘1 year hold’ much of the outcome is due to chance. Having said that -

The list:

1
AHL[5D][1Y]
Aspen Insurance Holdings Ltd 55.00 99.89 FINANCIAL INSURANCE 3,311.60 0.54 55.80 40.34 6.59 4.41 18.69 15.10 21.87 14.67 16.25 5.02 0.24 5.73
2
KEP[5D][1Y]
Korea Electric Power Corp 18.48 99.77 UTIL UTILELECTRIC 23,726.99 0.26 28.37 18.40 -2.27 -4.45 -24.08 -27.67 -28.34 -35.54 -11.66 -22.90 0.69 14.51
3
JBLU[5D][1Y]
JetBlue Airways Corp 22.42 99.66 INDUSTRIAL AIRLINE 7,258.09 0.89 23.67 14.76 9.90 7.72 26.95 23.36 36.21 29.01 2.47 -8.77 4.61 126.62
4
DLX[5D][1Y]
Deluxe Corp 71.61 99.23 INDUSTRIAL SERVICESUPP 3,479.24 1.52 73.42 49.46 4.71 2.53 7.36 3.77 9.34 2.15 35.42 24.18 0.21 6.13
5
RY[5D][1Y]
Royal Bank of Canada 67.71 99.02 FINANCIAL BANKCOMM 100,497.55 1.12 69.70 44.37 3.44 1.26 9.65 6.06 14.57 7.37 29.22 17.98 0.65 18.03
6
ALK[5D][1Y]
Alaska Air Group Inc. 88.73 98.81 INDUSTRIAL AIRLINE 10,937.39 1.00 91.89 54.51 7.08 4.90 32.26 28.66 51.34 44.14 13.18 1.94 1.03 24.66
7
FII[5D][1Y]
Federated Investors Inc. 28.28 98.63 FINANCIAL CAPMARKET 2,892.79 1.75 33.13 22.76 1.47 -0.71 -3.48 -7.07 0.68 -6.52 0.00 -11.24 0.80 25.40
8
RE[5D][1Y]
Everest Re Group Ltd 216.40 98.39 FINANCIAL INSURANCE 8,847.95 0.56 219.51 167.07 2.75 0.57 15.01 11.42 20.45 13.25 19.51 8.27 0.29 6.62
9
JNPR[5D][1Y]
Juniper Networks Inc 28.26 97.47 TECH COMMEQUIP 10,741.63 1.40 29.21 21.17 4.74 2.56 17.41 13.82 28.05 20.85 3.10 -8.14 2.07 94.36
10
ESNT[5D][1Y]
Essent Group Ltd 32.37 97.31 FINANCIAL BANKSNL 3,013.71 1.45 33.94 16.49 3.42 1.24 21.33 17.73 52.69 45.49 50.98 39.74 0.52 13.96
11
LRCX[5D][1Y]
Lam Research Corp 105.73 97.26 TECH SEMIANDEQUIP 17,097.18 1.47 110.35 63.10 7.25 5.07 11.78 8.19 29.11 21.92 36.02 24.78 1.34 53.76
12
CTSH[5D][1Y]
Cognizant Technology Solutions Corp 56.03 97.22 TECH TECHSVCE 33,987.80 1.13 63.43 45.44 3.61 1.43 11.17 7.58 -0.66 -7.85 -3.61 -14.85 3.29 135.61
13
CFR[5D][1Y]
Cullen/Frost Bankers Inc 88.23 96.97 FINANCIAL BANKCOMM 5,548.87 1.32 88.98 42.41 5.61 3.43 23.09 19.50 45.62 38.42 52.44 41.20 0.47 11.08
14
MD[5D][1Y]
Mednax Inc 66.66 96.56 HEALTHCARE HCAREPROVID 6,237.51 0.62 76.96 59.36 1.79 -0.39 1.17 -2.42 -8.26 -15.45 -6.18 -17.42 0.72 14.00
15
VR[5D][1Y]
Validus Holdings Ltd 55.01 96.52 FINANCIAL INSURANCE 4,370.16 0.58 56.41 41.73 0.47 -1.70 10.64 7.05 14.44 7.24 20.64 9.40 0.54 10.71
16
TCB[5D][1Y]
TCF Financial Corp 19.59 96.39 FINANCIAL BANKCOMM 3,348.93 1.14 19.97 10.37 8.83 6.65 36.90 33.31 64.35 57.15 41.34 30.10 1.10 29.09
17
AFL[5D][1Y]
AFLAC Inc 69.60 96.14 FINANCIAL INSURANCE 28,398.26 1.21 74.50 54.57 -1.25 -3.43 -2.75 -6.34 -2.66 -9.85 17.61 6.37 1.53 41.59
18
SYF[5D][1Y]
Synchrony Financial 36.27 96.09 FINANCIAL CONSUMERFIN 29,939.58 1.19 37.31 23.25 3.42 1.24 31.51 27.92 44.39 37.19 21.14 9.90 4.19 155.89
19
JAZZ[5D][1Y]
Jazz Pharmaceuticals Plc 109.03 95.73 HEALTHCARE PHARMA 6,530.02 1.43 160.00 95.80 7.14 4.96 -10.57 -14.16 -21.55 -28.75 -20.57 -31.80 0.59 12.92
20
ICLR[5D][1Y]
Icon PLC 75.20 95.67 HEALTHCARE MEDEQUIP 4,198.27 0.75 85.74 62.31 1.16 -1.02

It’s not a bad list for starting fundamental analysis on - if that’s how you invest (I don’t).

Best,
Tom

I just take the recent Top 20 out of the system I trade :wink:

Ticker	Weight	Return	Return $	Rank	Shares	Avg Shr Cost	Current Price	Value	Days Held	Sector

77 PZN 1.27% 11.99% 670.78 99.9 560 $9.99 $11.19 $6,266.40 30 Financials
63 NTIP 1.46% 61.27% 2,729.48 99.8 2,177.00 $2.05 $3.30 $7,184.10 337 Information Technology
47 KINS 1.89% 46.15% 2,938.03 99.7 697 $9.13 $13.35 $9,304.95 128 Financials
78 RILY 1.44% 10.94% 698.67 99.7 383 $16.68 $18.50 $7,085.50 44 Financials
45 ITIC 1.51% 14.39% 934.31 99.6 50 $129.81 $148.50 $7,425.00 37 Financials
29 DIT 1.62% 26.28% 1,663.70 99.2 69 $91.76 $115.88 $7,995.48 163 Consumer Discretionary
51 MDLY 1.23% 5.16% 298.04 99.2 614 $9.41 $9.90 $6,078.60 30 Financials
40 HCAP 1.24% 3.91% 229.92 99 434 $13.56 $14.09 $6,115.06 23 Financials
55 MOCO 1.24% 11.86% 649.62 98.9 315 $17.39 $19.45 $6,126.75 30 Information Technology
87 STRL 1.63% 26.08% 1,661.39 98.4 955 $6.67 $8.41 $8,031.55 120 Industrials
19 CLBH 1.46% -0.09% -6.4 98.2 281 $25.58 $25.56 $7,182.36 1 Financials
74 PLPC 1.16% -0.72% -41.39 97.8 99 $58.27 $57.85 $5,727.15 23 Industrials
80 SAMG 1.47% -0.96% -70.26 97.8 553 $13.23 $13.10 $7,244.30 1 Financials
44 INTT 1.29% 7.42% 438.07 97.6 1,350.00 $4.38 $4.70 $6,345.00 23 Information Technology
96 WILC 1.43% 9.57% 615.7 97.5 1,119.00 $5.75 $6.30 $7,049.70 120 Consumer Staples
4 APT 1.32% 1.23% 79.54 97.3 2,070.00 $3.11 $3.15 $6,520.50 128 Industrials
21 CSPI 1.47% 9.33% 618.64 97.2 705 $9.40 $10.28 $7,247.40 120 Information Technology
30 DLHC 1.44% 59.73% 2,658.89 97.2 1,193.00 $3.73 $5.96 $7,110.28 337 Industrials
65 OCC 1.54% -2.22% -172.87 97.2 2,413.00 $3.22 $3.15 $7,600.95 1 Information Technology
8 AWRE 1.43% 6.29% 418.67 97.1 1,132.00 $5.88 $6.25 $7,075.00 37 Information Technology

Thank you for the contest.
Regards

Andreas