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Wednesday, 6 June 2007

US Stock Trade and Portfolio Update - June 2007

This month I selected AVICI Systems (AVCI) from the current MagicFormula listing to add to my "Little Book That Beats The Market" Portfolio of US Shares (100% geared). I bought 520 AVCI @ market (around $9.52). My US Stock Portfolio current situation is listed in the sidebar.

My portfolio had recently reached an annualised ROI of over 24%, but in the last few days it has dropped back slightly to currently have an XIRR=22.84%. My success criteria is to achieve a return greater than the cost of funds invested (borrowed as part of a "Portfolio loan" from St George bank, so the interest rate is the standard variable home loan rate, around 7.25%), and my long-term target is to achieve a ROI of 10-20% pa.

After I'm fully invested with a portfolio of 18 stocks this December (approx. US$90K) I'll start to sell off the oldest holding each month and replace it with a new pick from the current MagicFormula list. Rather than rolling over the exact amount realised from each sale into a new stock, I'll invest 1/18th of the current portfolio value, adding in some extra cash when needed. That way I'll be investing roughly equal dollar amounts each month.

Enough Wealth

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