Some Return Analysis for this Board

[VAL9000]

Hi all,

 

I got curious about the different securities that have been discussed at length on this board and did some analysis.  I'll state up front that this is mostly meaningless and that the methodology is weak.  I still thought it was interesting enough to share.

 

I took a look at the 14 most active threads on the board (the first screen in Investment Ideas if you sort by replies).  I grabbed the return information from the date the thread was started to today, and then I took the average return to see roughly where we, as a group, would have landed relative to the S&P 500.

 

A couple of notes on my method:

- I used the return for BAC instead of BAC warrants because I am lazy.

- I completely ignored dividends on both sides.  This is purely capital gains return.

- I made some gross oversimplifications when comparing/computing the average return - I assumed an equal investment in the annualized return of the idea to date.  Clearly this is meaningless in a real-world context, but I was just curious how it turned out.

 

Here are the results:

 

Ticker	Thread Started	Return To Date	Years "invested"	Rate of Return
LVLT	10/24/2010	82%	1.39	53.54%
RIM	1/5/2011	-79%	1.19	-73.04%
ALS.TO	1/8/2011	-10%	1.18	-8.93%
BAC-WT	10/19/2010	-25%	1.41	-18.51%
CLWR	5/13/2011	-45%	0.84	-51.28%
GOOG	5/16/2011	19%	0.83	23.00%
FTP	5/9/2011	-30%	0.85	-34.18%
SSW	1/5/2010	90%	2.19	34.15%
SD	11/30/2010	57%	1.29	42.10%
EBIX	5/9/2011	9%	0.85	10.39%
MBI	12/18/2010	-1%	1.24	-1.06%
JEF	10/28/2011	25%	0.38	79.67%
ATPG	11/8/2010	-49%	1.35	-38.89%
AAPL	1/18/2011	73%	1.16	60.65%
	Average:		1.15	5.54%
	S&P Return:	8.03%	1.15	6.92%

 

It doesn't mean all that much, but I thought it was interesting how many of these investments were either knocked out of the park, or were absolute dogs.  It'd be interesting to follow up this cursory analysis with an understanding of which of these threads/ideas were more one-sided (i.e. "group think") and which were more controversial - both can jack up a thread's reply count.

 

I also found it interesting that the average return was so close to the S&P's return for that period.  I guess that shows the power of diversification (for better or worse).

 

 

 

[racemize]

It would be cool if we could somehow crowd source the buying and selling of various ones of these and then track that performance.  e.g., when the board had consensus that something was a buy and when to exit.  Seems almost impossible to do though (at least easily).

[Valuebo]

Great work VAL9000, I appreciate it! :)

 

It would be cool if we could somehow crowd source the buying and selling of various ones of these and then track that performance.  e.g., when the board had consensus that something was a buy and when to exit.  Seems almost impossible to do though (at least easily).

 

That plus a longer track record. Two years is way to short. There is also a problem with timing the purchase price. Interest of the board starts when the topic is opened, is doesn't end there. Decent value investors average down.

 

On the other hand, I'm confident that many other forums would have much lower (near negative) returns over the long term.

[racemize]

oh definitely, e.g., many of the FTP folks would still be/are holding (I assume), so I don't think the negative returns would reflect the ending results.

[Rabbitisrich]

The investing ideas section doesn't seem to be a recommendation page like Value Investors Club or SumZero. For example, the LVLT thread starts with a reference to a recent price drop and a query about board opinions. Board members have different motivations, but this board seems more useful as a source of ideas and aggregate of opinions rather than as a research reference.

[rijk]

how nice to see jef in the list,..... fortunately  i put some money behind the idea and matched the annualized return......

 

regards

rijk

[bookie71]

don't forget Raganisapirate's IBAL it has almost tripled.

[biaggio]

Thanks Val9000.

 

Have often wondered what the batting (slugging) average was for folks here.

 

I must say as time goes by I am more impressed + humbled by the  performance of some of the folks here. Hope a little rubs off on the rest of us.

 

It would be cool to track the performance going forward of the group think here.-would it be possible to have some sort of survey on an idea i.e buy or sell or no opinion. Then see how it works out.

 

(Take for instance the RIM idea- I think it was a long thread because there were a lot of guys here that did not agree with RIM as a buy).

[racemize]

Thanks Val9000.

 

Have often wondered what the batting (slugging) average was for folks here.

 

I must say as time goes by I am more impressed + humbled by the  performance of some of the folks here. Hope a little rubs off on the rest of us.

 

It would be cool to track the performance going forward of the group think here.-would it be possible to have some sort of survey on an idea i.e buy or sell or no opinion. Then see how it works out.

 

(Take for instance the RIM idea- I think it was a long thread because there were a lot of guys here that did not agree with RIM as a buy).

 

That's what I am thinking as well. E.g., I think the board had concensus on bac, though not sure at what price.

[Liberty]

Thanks VAL. Interesting to see, though, as you say, I'm not sure it means much about any actual real-world performance this board's members are experiencing.

 

The main difference that I see in the stocks listed is that some are just going through business as usual while others are waiting for catalysts. For the latter, it is the performance post-catalyst that will matter, because unless these don't materialize at all, I think most holders won't sell before then.