Gentlemen's Stock Picking Club

[greg]

While listening to NPR yesterday, I thought it would be nice to have our own small stock picking thread club right here in FIRE-land. It would be fun to observe people's thinkin processes and perhaps learn things too, and after a bit of time it would be interesting to find out if, collectively, we are smarter than the S&P 500 or some facsimile, hold ourselves up to the world as a gestalt of stock pickin prodigies. It would require a mildly higher skill set than just picking individual stocks in isolation as we attempt to add balance and complementing features--whatever those are--to the smallish portfolio.

So to keep it simple: ten large cap stocks at 10K hypothetical dollars each=$100k total, folks volunteer their picks, we argue a bit about the choices and or alternatives and then vote each one up and down. We sell or vote to sell whenever someone makes the suggestion. As simple and straightforward as possible; majority rules. If that works, we maybe move on to ten small-caps. Someone could set up an MSN or Yahoo portfolio sight where we could each go to examine our hypothetical progress. Someone who has actually done this before should run it? I'm at the end of my ability right here.

So as a first order of business, can we let the ladies join too, please?

Second order of business, I still like GE as a base and stable holding and as dividend payer.

[novaman]

I'll join.

I like Citigroup (C) and or Bank of America (BAC). Bank stocks are getting hammered right now.

[CyclingInvestor]

I consider JNJ and PG both to be well-valued blue chips.

[greg]

Double post mistake; see below

[greg]

Quote:

Originally Posted by novaman I'll join. I like Citigroup (C) and or Bank of America (BAC). Bank stocks are getting hammered right now.

I certainly think that two int'l bank stocks (20%-30% of the portfolio) would be good choices also (How much int'l business does BAC do, if any?). I really like large cap industrials for the next ten years or so, infrastructure build out coming?, the rise of emerging market nations as consumers of roads and electricity and makers of sewage and stuff and such, etc.

[LOL!]

My spouse was in two different investment clubs over the last decade. My observation from that is that if you are gonna pick 10 large cap stocks, then you are just mimicking the S&P500 and consequently, will do about the same as that index.

Why not pick 3 large cap, 3 mid cap, 4 small cap and half of them half to be non-US stocks? That might help get you away from S&P500 returns.

Here's my picks: SPY, VTV, MDY, IWM, VBR, EEM, VWO, DLS, GWX, VNQ. Buy them only within the last 30 minutes of trading when they have dropped at least 1.5% (SPY, VTV), 2% (MDY, IWM, VBR, DLS, GWX), 3% (EEM, VWO, VNQ).

Good luck!

[greg]

Quote:

Originally Posted by LOL! My spouse was in two different investment clubs over the last decade. My observation from that is that if you are gonna pick 10 large cap stocks, then you are just mimicking the S&P500 and consequently, will do about the same as that index. Why not pick 3 large cap, 3 mid cap, 4 small cap and half of them half to be non-US stocks? That might help get you away from S&P500 returns. Good luck!

Yes, I agree about too closely mimicing the S&P.

How about picking ten S&P 500 stocks as our portfolio and then use the S&P as the benchmark to beat? Seems fairly straightforward to me, easy to keep track of, and would definitely bring out stock picking skills over indexing or ETF-choosing skill sets? But I like ETFs too.

Ten stocks from the Russell 1000?

[HFWR]

Asset appreciation would likely mimic the S&P500, but the divvies for a P&G/GE/J&J/BAC-type portfolio would probably boost overall returns beyond the S&P500, which is paying a paltry 1.8-ish% div...

[twaddle]

Well, any large-cap value slice is likely to beat the S&P500 if you let your benchmark run long enough. Just put it all in VIVAX.

Or do the Bernanke thing: 100% MO, baby!

[Leonidas]

I like this idea. But I want to suggest that we proceed along the lines that LOL and Greg are talking about - with a slight twist.

Why don't we pick a sector - or even an industry - and then pick 3 large cap, 3 mid cap, 4 small cap, plus some foreign? We can work our way through the sectors and/or industries we think have the most potential for LT gain, and then we would have a palette of different companies to look at within promising sectors. It might even spur some interesting discussion on allocation.

[twaddle]

I always thought that the real test of stock picking skills was risk-adjusted returns. If you want to demonstrate alpha, you need to pick stocks that outperform your benchmark without increasing volatility.

[greg]

How about a ten stock retirement (safer?) portfolio and a separate ten stock shoot for the moon portfolio? Then benchmark it to a large cap or value index, a small cap index, and a total stock market index?

[BUM]

I'm game. Right now I like WU (I keep a GTC limit order at $18 ) and GE.

[bpp3]

Toyota.

[jIMOh]

My take is similar to some of replies already. large caps will mimic dow and S&P 500. Small caps can lead us to the promised land better.

I do plan on an individual stock position in my portfolio for growth and dividend income.

1/3 would be in blue chips (PG, MSFT, GE and many others already mentioned). This is around 10 stocks.
1/3 would be utilities. This is for a slightly higher yield. This is around 5-10 stocks.
1/3 would be in small caps/micrco caps WHICH PAY A DIVIDEND. This is around 60 stocks. In january I entered a contest with these tickers. It is barely beating the S&P YTD. Mid cap value for sure, some real small companies included.

EQY26.20+0.11CU33.99+0.74TRY15.22-0.17BEBE14.15+0.07PTNR14.89-0.12WNR48.68-1.25TR28.77-0.10ASCA26.10+0.40RES13.20-0.07*TRK37.52+0.41KRO21.3700-0.1180SHS26.2200-0.1800RNT25.23-0.06ALFA17.62+0.35OXPS23.03-0.02ROL26.10+0.11CNS34.84-0.15ZZ15.49+0.27ESLT42.55+0.51STFC30.14+0.23OO28.45-0.01MGG27.1973-0.7127TLB22.0900+0.6900WTS34.96+0.01WSO48.55+0.91ALJ33.7800-1.7900WWE14.29-0.13FFG37.9600-0.4400VCO42.33000.0000SYNT35.20+0.29GBL53.34+0.65BKE34.8000+0.2000HRZ27.71+0.05TNP67.61-0.59NRGP43.87-0.40ABG22.4100+0.5400FBN12.2800+0.1000TNH74.37+2.16PORK00EGLE24.20+0.58TOA2.68-0.13MWP50.48-1.20DRYS54.22+2.33VTO6.8200+0.1200RLRN13.15-0.08SUP20.56-0.11SGK21.94-0.53NL10.96-0.21KCP20.46+0.05VICR12.09-0.29*SBCF20.98-0.30MPX8.87+0.02XRM5.49-0.02*FF12.40+0.31IPAR22.18+0.11TAYC28.75+0.21DEBS26.33+0.07ALCO51.15+0.12SQM149.5300-3.2200MGPI14.72-0.28AP39.4000+0.1200PEGA11.90-0.31RCKB14.90+0.01NYM26.91-1.19OHB6.28-0.28SCL30.0400-0.1400CPY43.3900+0.5700QADI8.49+0.02VLG0.00000.0000

[bright eyed]

your thread title made me think there was going to be some nudity involved...

[REWahoo]

Quote:

Originally Posted by bright eyed your thread title made me think there was going to be some nudity involved...

Hey, there's always the possibility someone will lose their shirt...

[HFWR]

Quote:

Originally Posted by bright eyed your thread title made me think there was going to be some nudity involved...

This could be get ugly...

[twaddle]

Quote:

Originally Posted by bpp3 Toyota.

In dollars or yen?

I don't like any sectors that any sensitive to consumer spending or consumer borrowing for the next couple years, but TM does seem a bit oversold.

I nominate Eni SpA (E). Reasoning: foreign large cap could help if the dollar declines, I still like energy even if we hit a recession, and they trade below book value. Oh, and I guess the 4% yield doesn't hurt either.

Edit: Wow, I already learned a lesson from this exercise. Looks like Yahoo has the market cap wrong by a large margin, so forget that "below book value" bit.

[greg]

Quote:

Originally Posted by bright eyed your thread title made me think there was going to be some nudity involved...

Strip Poker Stock Picking: Must have a number of ladies involved to work properly. The loser each quarter makes a video and posts it to Youtube.