Can we achieve super performance without rule based strategy?

29th Dec '17 by tripuram

3 comments 2293 reads

What is that I have achieved this year?

50% return in my overall portfolio - most of them can be attributed to bull's market probably. I am sure I too can take some credit for picking up the right ones :-)

How did I achieve this?

I am not a rule based person but more influenced by basic analysis of data and significant input from SCVR.

Here are some of the articles that I read regularly:

Daily RNS report
SCVR report from Paul and Graham and excellent comments from all the readers
Special focus to Paul’s investment strategy - I read it multiple times to make sure that I understand the points before clicking the buy button.
Ed’s NAPS and SNAPS whenever it comes out
Rolands SIF – great rule based strategist : although I don’t follow clear rules.
Ben’s articles – behavior analysis
I do check other sites e.g. naked trader and other sites

While I do value all the articles above, most of the investment decisions are influenced by Paul’s GREAT insight and UNBIASED view. I don't think I could have achieved returns anywhere near without SCVR.

My 2017 Portfolio returns –a snapshot

GMD: 176%

ABDP : 75.3%

AIR 25%

EIG : 10%

G4M: 40.1%

TET : 36.6%

IGG: 36.2%

BOO: 30.4%

TWTR: 28.2%

IQE: 10.1%

Losses:

PURP -2.13% (I made 125% earlier and exited and re-entered @424)

FCCN -9.61% ( this is not going anywhere and my patience is running out)

RBG -12.3% (initial investment @221 but recently bought again @150 - hoping that new bidder comes through new year)

How can I achieve super performance - returns greater than 100%?

Hope it is not a naive question. Can people achieve super performance without a strict rule based strategy? Firstly, I find it difficult to create a rule set and stick to it. Secondly, I work in the financial industry and there are constraints that I cannot put stop-losses (as suggested in Mark Minervini's book)

Any views from your experience will be much appreciated..

Happy New Year to you and your families. Wish you all a great investing year ahead.

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Effortless Cool

30th Dec '17

50% is a phenomenal return - well done. However, I think it is a return you should be very happy with - the real challenge for you is to repeat it next year and the year after, not to double it.

In reality, there are only two ways for you to target a 100% return - to invest in a very concentrated portfolio, probably no more than three shares, or to leverage your investments. Both of these increase downside risk materially.

In summary, I'd suggest that you build on and refine what you did this year, rather than concerning yourself about doing twice as well.

tripuram

31st Dec '17

thanks Effortless Cool and that is a very good point you made.

Historically I have maintained a diversified portfolio with mediocre returns and this year I improved a lot by trimming down ruthlessly even when they were loss making -its always difficult to sell when something is loss making...

Point well taken on maintaining consistency. This year I have become more confident and more cautious on picking up stocks. Hope I maintain that and improve further with a better concentrated portfolio to enable me to achieve my targets.

BTW, I would like to thank you personally for analysing ABDP earlier on share based payments.Analysis and further comments helped me to hold onto the stock longer resulting in a positive uptick..
...

Glad to have helped, tripuram. ABDP has certainly been a great performer over the last quarter.

Can we achieve super performance without rule based strategy?

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Tripuram

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