Just over a year ago I finally ventured into the world of stock investing.  Oh, to be sure, I’ve used mutual funds in my 401k for years.  However, I’d never taken the plunge when it comes to investing in individual stocks.

I’d been trying to decide how to invest my son’s college fund and was not impressed with investment returns of the state 529 programs.  Believing I had the knowledge to do better, I spent part of the prior couple of years looking for a new strategy that I could use.  In order to make sure that I was doing the best I could I decided to get my own skin in the game by leveraging the self-managed part of my 401k and apply the same strategy to both my 401k and my son’s college fund.

So, the quick summary of the first year’s pre-tax, pre-fee returns:

  • Self-managed 401k ROI excluding any fees – 29.6%
  • College Fund excluding fees/taxes – 32%

I’m extremely excited about those returns.  However, I need to caveat those with a couple of things prior to digging into the details.
First, I don’t currently have the inclination or time to perform analysis on individual stocks.  That said, I’m leveraging a quantitative value stock strategy in which a computer applies algorithms based on criteria to pick my stocks for me.   I did not design this system and in some ways accidentally stumbled over it.  (IE, I’m not that smart!).  More on this in a minute.

Second, the stock market has been significantly up in the past year.  In fact, one of the mutual funds in my 401k is tracking at about 35%.  The other two funds are doing well but less than my 29.6%.  In other words, most people made (or should have made) money investing in stocks over the past year.

So, what was I looking for in an investing strategy?

  • I could understand the basic premise of the strategy if not the implementation details.
  • Didn’t take a lot of time to implement
  • Was a value strategy, meaning that I would buy and hold for a defined period of time.
  • Helped eliminate the emotional buying and selling that can occur with regular stock trading.
  • A computer picked the stock (thus providing b,c and d above).
  • Protected my capital

I’ve been a student of the Benjamin Graham and Warren Buffett value investing idea since I first encountered their ideas years ago and was researching information on how to screen stock using Benjamin Graham’s formula.  While doing this research I stumbled across a website (turnkeyanalyst.com) with associated blog and found that they had run analysis on different value investing strategies. The analysis included backtesting on the Magic Formula, Graham Formula and a Quantitative Value strategy that the authors of the blog had been working on and were in the process of publishing a book covering the strategy.

In comparing the tested strategies, the two that appealed to me were the Quantitative Value and Benjamin Graham strategies, both having very similar compound annual growth rates (CAGR).  In the end I went with Quantitative Value which had yielded about 17% in their tests.

After settling on the model I next determined my portfolio size.  Due to the difference in size between the college fund and my 401k I decided to only use the first 10 stocks for the college portfolio to help keep costs down and 15 stocks for my 401k portfolio.

And so last year I bought the following stock and two weeks sold all but one that the strategy still includes in this year’s purchases :

Portfolio Stock ROI
Both AET 73.16%
401k APOL -34.25%
Both BKE 36.03%
Both DELL 12.20%
Both DLB -5.00%
401k FRX 28.45%
Both GES -9.53%
Both HUM 41.66%
401k NOC 39.06%
Both SPLS 7.25%
Both STX 22.98%
401k TKR 44.56%
401k TSO 38.48%
Both UNH 40.32%
Both WDC 51.23%

As you can see there are several different industries covered in my portfolio and there were a number of very good purchases and some that could have been better.  The bottom line is that the overall return was phenomenal.

Now, before you rush out and try something I’d like to make a few observations and then wrap this up.

  1. Before doing anything.  Research.  Learn and understand.  Don’t do anything without doing your own homework.
  2. I don’t necessarily recommend the path I took for everyone.  In fact, you might follow the advice of Warren Buffett and others who recommend that the average person use good indexed funds with low costs.
  3. Watch out for emotions and for any ideas that you can time the market.  Case in point.  I was supposed to sell my stock on 8/15/2013, however, due to being unprepared and busy I didn’t.  Several days later the stock market dropped and my portfolio lost about 2% in value.  I then waited another almost two weeks in hopes it would recover and it did not.  Lesson learned.  Sell when the strategy says to sell and buy when it says to buy.
  4. If you choose a buy and hold strategy don’t monitor it every day unless your strategy says to sell the stock after a certain percentage gain, holding time period etc.
  5. There will be ups and downs.  This past year I made 32% (before fees/taxes) , next year I may only make 10%.  We’re looking for long term growth and capital preservation.

Finally, I’m not a licensed investment professional and encourage you to seek out a professional to help you put a comprehensive financial plan in place.  Lastly, I currently have holdings in WDC.



Between Universes

A little stream of conscious / poetry…

Caught in the world that’s in between
A no man’s land in which you scream
But no one hears your heart pound
When you open your mouth there is no sound
The bubble you’re in sits between the ‘verses weightless, cold, empty and void.
Perhaps it’s a dream, you stop and think, no way out, become annoyed.

No way back wouldn’t go if you could, and the way forward, blocked, and you would
Plunge right ahead but not sure where or how, so in this bubble you reside, cowed

Questions coming from all sides. Mostly just who, where, what when and why.
Perhaps, if you would your striving cease, rest, relax, and Providence gives peace
Wondering if there’s anything out there, asking questions no one dares.
Their ivory towers, dastardly facades, group think common, no allowance for marauders

They talk and teach to maintain their power, truth be damned no matter the hour
None dare looks to help a friend, for fear they too will be castigated.
Anger fills the wretches soul, will none reach out as he falls in the hole?
It is no matter, you turn away, and now in the bubble he lays…

But from within another world appears, distant though and not quite clear
Others have made it, so have no fear.  The barricades that are in the way
Will hopefully soon, just fall away.
Mysterious guest, appears at last, will they see or by him pass…
Emotion hidden, received or not, the guest might never know.
What was may be, could be no more, shall not nor be unless the door is opened.
Seeking, solace, the fight rages on, will he survive til the break of dawn.
Heart grows faint and weary still, but presses on he will.

The waves are daunting, overwhelming, towering beyond our sight
Crashing down, feel like we may drown, rising again we weep
The ship is damaged, gone off course, caused by the travails of life’s deep course.

Wondering as he wanders, the traveler thinks and see the other world draw near.
Will he make it, sometimes he fears.  What if’s flood the mind, perhaps it’s all a mirage he’ll find.

God speed to travelers one and all, you may make it or not at all.
Better though to have tried and failed, than to never have tried at all.
Than to be like those whose only vision includes those staid stale white towers and hollow hallowed halls.


Blech, sometimes. I. Struggle.

I set a course based on what I believe to be true. And sometimes founder a bit.  I’m foundering.  Choices to be made.

They are not choices you would make.  Then again, you’re not me and don’t have my life.  I generally like my life. Blessed to have an amazing wife, kids, cars, house and no pets.

It’s odd really.  Many times when seeing an amazing performance whether on stage, musical, movie… my heart yearns. to be doing that. aches for it really. I’m heading that way but most days not fast enough.  I’m currently the only one in my house with that yearning.

Sometimes.  Would be nice to have someone to do it with. A good friend perhaps.

I must course adjust.  First, I must consider what the adjustment must be.  Don’t see a fundamental shift, no 180’s.  Not my style. In considering the adjustments I need to set a goal, a target an endpoint. Where I want to go.  

Assess. Where I’m at. Then the needed course correction should be clear. 

It’s an odd place to be at times. Not worries per se, contemplative. semi-heavy heart of which some is tied to flat out tiredness.

What is it that you want from someone? Did you tell them? Do you know and do they know? Hard for them to respond and answer if not. Ah, fear holds you back eh? Common malady among humans. Not for the faint of heart to be sure. And what if the choice isn’t quite accurate, well then, course correct my friend.

Too tired to write.  Probably shouldn’t publish… eh, it’s all just random stream of conscious type stuff. And helps get some random stuff out of my head.

Peeling the Onion

Have you ever paid attention to the layers of an onion as you peel them away?  Did you ever find one that was rotten in the middle while the outside was good?  Have you ever taken a bite of a delicious looking apple only to discover that what appeared to be good was rotten in the core?

I’m sure many of us have experienced such things.  I’ve been disgusted by rotten apple cores… still, sometimes the apple can be salvaged once the rotten bits are removed thus rendering it fit for use…

Have you ever had that happen to you as it pertains to your behavior?  Has someone challenged you on a behavior and all of a sudden you realized that there was a rottenness in you that needed to be removed?

It happened to me recently.  It turns out that my attitude in words towards those closest to me can be biting, hurtful, unkind and unloving.  Now that it’s been brought to my attention I can’t say that I never knew… It was one of those things that I knew needed to be changed at some point… well, some point has arrived and now I must tackle it head on.  I’m going to focus on destroying the soul negativity that is hurting some of my closest relationships.

It won’t be easy.  However, as a person who sincerely wants to be more loving and kind, and as challenged by the Bible, it is something I must strive to achieve.  I have two passages in mind:

Philippians chapter 4:

Let your gentleness be evident to all… Do not be anxious about anything, but in every situation, by prayer and petition, with thanksgiving, present your requests to God.And the peace of God, which transcends all understanding,will guard your hearts and your minds in Christ Jesus.

Finally, brothers and sisters, whatever is true, whatever is noble, whatever is right, whatever is pure, whatever is lovely, whatever is admirable—if anything is excellent or praiseworthy—think about such things. Whatever you have learned or received or heard from me, or seen in me—put it into practice…

13 I can do all this through him who gives me strength.

And of course, the famous chapter in I Corinthians which defines love.

So there is my challenge to myself for the rest of the year.  Sometimes you just need to peel the onion and tackle the junk that’s buried underneath. I challenge you to do the same.


Day 90 – Finito

90 Days.  Completed today.  Tomorrow is a new day.  I’m pulling back from one a day to something like once a week.

Questions to be answered
Soft lines to be drawn
Thoughts to be wondered
Begins again at dawn

Knowing not what the future holds
At peace with whatever happens now
Pursue the future, being bold
I think about it, and wonder how

To begin again and start anew
Will it begin or be over and through
The journey continues tomorrow
Moving forward, no sorrow

Writing every day is finito
Wipe clean the slate
Crawl out of a crate
Getting back my life, espléndido

What is next, I do not know
Pretty standard in life though.
Endless possibility awaits
Seize the day, do not wait.

Day 89 – Ostracized

You kicked me out the front door
I don’t want you around, anymore
Do you really think I’ll put up with that
After our “so-called” little spat?

I did everything you wanted and asked
You still have the audacity to take a pass
At taking on life straight on no games
As you threw my stuff out, so lame

You say you want me back in your life
Every time I see you it’s like the knife
Is stuck in my back one more time
Moving on, not easy or sublime

The rumors you spread, so unkind
Not true, not fair, doesn’t even rhyme
Lies they were, I’ll give you that
It’s what caused our “little” spat

Everyone shuns me, like some leper
You may as well have poured salt and pepper
On my wound, considering the way it burns
I’ll bite my tongue someday, it’ll be your turn

My other friends look at me strange
Like a dog, feels like I have the mange
Outcast, not even a renegade
No where to turn, very staid.

No text, no email, not even a call
To say your sorry, not on my fb wall
I’ve forgiven you for all of that
For ostracizing and making me an outcast.

And Then There Was One… pun based on Agatha Christie murder mystery novel “And Then There Were None”… Completely different context but it sounds good.

Day 88 – Red

The color of passion of any sort
Can be for love or anger if you resort
If I see red, then you may see steam
Roll out of my ears, as I prepare to ream.

But, lover’s passion is also red
Steamy, sensuous, don’t be misled
By what you feel,
Sometimes it can be tenuous
May not be real.

Anger breaking forth danger abounds
Don’t dare let it out while making the rounds
Someone could get hurt if you don’t bend
You won’t break but you may need to bend

I see the passion in your eyes
Would be uncomfortable
But I cannot disguise
I feel it too, could lead to demise

No matter which extreme you feel
Cautiously guard how you let it out
Properly channeled can make changes real
Out of control, real damage without a doubt