Sunday, 14 January 2007

US Shares - "Little Book" Portfolio Update: Jan 07

I continued to build up my "Little Book" portfolio of US stocks with my regular US$5,000 stock purchase of one of the stocks listed by the magic formula investing website. This month I chose Crytologic (CRYP) . Some of my previous picks have dropped considerably, especially OVTI, so my overall portfolio now has around 0% return after deducting buy/sell costs. Taking into account the interest on the money I've borrowed to make the stock purchases, I'm under water at this point. Not that it really means anything - I plan to stick to my investing plan for at least ten years before looking at the average return and volatility to decide if the risk-adjusted return is as expected.

1 comment:

Hendrik Oude Nijhuis said...

Hi,

I am also a shareholder of CRYP. What’s interesting is that Pabrai, an investor who I highly regard, bought big positions in CRYP also recently.

On Greenblatts’ Magic Formula: I (as an investment analyst) would recommend to use it as a starting screen, not as a screen to pick stocks randomly from (which is what Greenblatt advices in his Little Book). I would advice to read first more on (durable) competitive advantages to get knowledge about WHAT stocks to select,

Success in investing,
Hendrik Oude Nijhuis
www.magicformulastocks.com