By Paul Price
The DJIA winning streak stopped after 10 trading days. Market Shadows’ hot hand continues.
Our model Virtual Value Portfolio, (initiated on Oct. 26, 2012), finished last week at a new all-time high.
Our $100,000 original stake has grown to $116,175.09 including dividends for a 16.2% total return in less than five months. That equals 41.6% annualized. Our benchmark, the S&P 500, rose 11.6% including dividends for a 29.8% annualized rate over that same time period. Market Shadows now has a 39.3% outperformance ratio!
We booked a nice profit on one holding last week while adding one new name. Cummins (CMI) was sold for a 27.4% gain plus dividends. We bought shares of Quest Diagnostics (DGX) for the first time. DGX offers a decent yield, solid upside and a low risk profile.
Our cash position has grown to $11,018 as we’ve sold a bit more than we’ve added over the past couple of weeks.
All four of the stocks which we averaged down on since inception (Coach, Calamos Asset Management, Express Scripts and Potash) are starting to move up again. You can see a detailed view concerning the wisdom of buying fallen stocks elsewhere in this issue. (Hint – I’m a fan averaging down.)
Paul sees less bargains than he did several months ago. However, he still likes Express Scripts (ESRX), Quest Diagnostics (DGX), Lab Corp. (LH), Coach Inc. (COH) and Calamos Asset Management Inc. (CLMS) at current prices.
Patient investors may find better bargains if this toppy market sells off – which wouldn’t surprise us. We’ve built our cash position up a little bit for this reason.
For immediate updates on buys and sells from the Virtual Value Portfolio and the Selling Put Portfolio, visit us here.