When the portfolios of Stockopedia’s 60 guru-inspired investment strategies were refreshed in June, the timing looked dreadful. The routine quarterly rebalancing came just a week after the EU referendum, when the portfolios were in the throes of serious volatility. Back then, few would have predicted the surging market comeback that we saw over the summer. But with indices now hitting 12-month highs, many of the strategies inspired by legends of finance have had a great quarter.
The timing of the last rebalancing (at the half-year) means it’s not easy to make a fair assessment of which strategies were most resilient to the volatility (seen in the FTSE All-Share chart below). That’s because the stocks in the portfolios were changed just as the market bottomed. But looking back over the past three months, it is possible to see which have bounced back strongest.
How the guru strategies performed
Before taking a look at how the guru screens got on in Q3, here’s a quick reminder about how they work and what the performance stats tell us. Since late 2011, we’ve been tracking the returns from a range of approaches used by some of the world’s best known investors. Each one is categorised as either Quality, Growth, Value, Bargain, Income or Momentum. They’re rebalanced quarterly to ensure that the shares in each portfolio meet the rules of each strategy as closely as possible. We don’t account for the drag of trading costs or the bonus of dividend payments.
These models aren’t always realistically investable. At times, there may be very few companies that meet the rules of some of them. And because there are no restrictions on company size, sector or index, there’s no obvious benchmark to compare them against.
| Index / Strategy Composite | Performance Q3 2016 | 9 Months to 30/09/16 |
| FTSE 100 | + 6.1% | + 10.5% |
| FTSE All Share | + 6.8% | + 9.0% |
| FTSE 250 | + 9.8% | + 2.5% |
| FTSE SmallCap XIT | + 11.9% | + 5.0% |
| AIM 100 | + 16.3% | + 11.6% |
| Guru Strategy Composite | + 15.2% | + 6.4% |
| Growth Composite | + 18.6% | - 1.2% |
| Bargain Composite | + 16.0% | + 20.9% |
| Momentum Composite | + 15.1% | + 8.9% |
| Value Composite | + 14.8% | + 8.7% |
