Yet Another Solid Momentum Value Stock Portfolio Beating S&P 500 Handily

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Performance (As of 05/17/2012)

Annualized Return

Name YTD**
Return
1Yr
AR*
3Yr
AR*
5Yr
AR*
P Sequoia Fund Top Stock Momentum 0% 10% 22% 17%
VFINX (Vanguard (S&P 500) Index) 6% 2% 16% 0%
VBINX (Vanguard Balance (60% stocks/40% bonds) 5% 4% 13% 3%
The portfolio selects top 5 stocks each month from 15 top holdings of Sequoia fund (SEQUX).
This is getting exciting.
See P Sequoia Fund Top Stock Momentum for the complete 11 year performance. Top holdings at the moment:

Momentum On S&P Low Volatility Stocks

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Low beta or volatility stocks have proven to be better bets for the last 10 years or even longer periods. The portfolio P SPLV S and P Low Volatility Stocks With Momentum uses momentum scores on S&P low volatility stocks (100 stocks) from ETF SPLV and chooses top 10 stocks (if any one of them has lower momentum score than cash, cash is used instead) each month in equal amounts. The results:

Annualized Return (up to 5/4/2012)

Name YTD**
Return
1Yr
AR*
3Yr
AR*
5Yr
AR*
P SPLV S and P Low Volatility Stocks With Momentum 12% 16% 19% 4%
VFINX (Vanguard (S&P 500) Index) 10% 4% 17% 0%
VBINX (Vanguard Balance (60% stocks/40% bonds) 6% 5% 14% 3%

So this strategy looks promising. Current 10 highest momentum stocks:

Currently, this portfolio holds the following 10 stocks:

Asset Fund in this portfolio Percentage
Asset0 (ORLY)(O’Reilly Automotive Inc) 9.91%
Asset1 (SHW) (Sherwin-Williams Company) 10.09%
Asset2 (ROST)(Ross Stores, Inc.) 10.17%
Asset3 (TJX)(TJX Companies) 10.03%
Asset4 (DLTR)(Dollar Tree Stores, Inc.) 10.04%
Asset5 (PM)(Philip Morris International, Inc.) 9.98%
Asset6 (RTN)(Raytheon Company) 9.91%
Asset7 (SRE)(Sempra Energy) 10.05%
Asset8 (AZO)(AutoZone Inc) 9.85%
Asset9 (SLE)(Sara Lee Corporation) 9.98%

See more detailed report 10 S&P Low-Volatility Stocks With Momentum

Warren Buffett’s High Dividend Stocks With Momentum

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Here are the list of high dividend stocks Warren Buffett’s Berkshire Hathaway holds:

Company Market Cap ($B) Yield (as of 3/1/2012)
GlaxoSmithKline plc (GSK): Discovery, development, manufacture, and marketing of pharmaceutical products  $113.32 5.02%
Sanofi (SNY): Discovery, development, and distribution of therapeutic solutions  $100.81 4.68%
General Electric Company (GE): Operates as a technology, service, and finance company  $202.28 3.55%
Johnson & Johnson (JNJ): research and development, manufacture, and sale of  health care products  $178.92 3.50%
M&T Bank Corporation (MTB):  provide commercial and retail banking  $10.35 3.42%
ConocoPhillips (COP): Operates as an integrated energy company  $98.88 3.42%
Procter & Gamble Co. (PG): Provides consumer packaged goods  $185.62 3.12%
Intel Corporation (INTC): design, manufacture, and sale of integrated circuits  $136.09 3.08%
Kraft Foods Inc. (KFT): Manufactures and markets packaged food products  $67.14 3.05%
United Parcel Service, Inc. (UPS): Provides transportation, logistics, and financial services  $74.17 2.97

See MyPlanIQ’s Warren Buffett 10 Best Yielding Stock Holdings

The portfolio that uses momentum to weed out weak momentum stocks leaves PG and COP out at the momentum. See P Warren Buffett 10 Best Yielding Stock Momentum. This portfolio’s performance:

Annualized Return (up to 5/3/2012)

Name YTD**
Return
1Yr
AR*
3Yr
AR*
5Yr
AR*
P Warren Buffett 10 Best Yielding Stock Momentum 4% 5% 10% 3%
VFINX (Vanguard (S&P 500) Index) 10% 5% 16% 0%
VBINX (Vanguard Balance (60% stocks/40% bonds) 6% 5% 13% 3%

*     AR: Annualized Return
**   YTD: Year to Date (not annuallized)

See more detailed analysis here Momentum Stocks On Warren Buffett’s 10 High Dividend Stocks .

What Is This Blog About?

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Value. growth and momentum are well recognized factors that can deliver outsized returns over a stock market index like S&P 500. One can follow great value and growth investors’ ideas to pick stocks that do well. One can also use momentum over a set of stocks (example, S&P 500 stocks or Nasdaq-100 stocks).

But how about combining these all together? This is the purpose of the blog: the idea is to use momentum over a set of stocks that are from Guru investors. In this blog, I will publish ideas and portfolios and see how such an idea can evolve and deliver over time.

Disclaimer: the author is not a registered investment adviser nor a financial adviser. The contents of this blog is for information only and does not constitute buy/sell advice. Use the contents at your own risk. Past performance does not guarantee future returns.

 

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