Proforma: The MHP (Magic Hat Portfolio) on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out "mistakes" that I feel the screening commits: unseasoned companies, scams, foreign companies (particularly Chinese), fishy accounting, and statistical quirks. Apart from that, I am agnostic as to the sector the company operates in, although I will try to avoid heavy concentration in any one sector. I will mostly apply "Strategic Ignorance", by which I mean that I wont try to be clever in my stockpicking. My picking will be mostly mechanical. A summary of transactions can be found at https://blippy.github.io/money... As of January 2020, I have adjusted my strategy a little. Instead of selecting stocks from the Greenblatt Screen, I will select them from Stockopedia's Screen Of Screens, and look for a StockRank (TM) in the 90's. I won't rule out selecting something from the Greenblatt Screen, though. With the boilerplate now out the way, let's move on to the actual content ...
Ferrexpo (LON:FXPO) was due to be ejected from the portfolio by rotation. The stock is up 9.3% today on its half-year report; a likely indication that I should keep it in my portfolio. It has a Stock Rank of 99, and passes the Stockopedia's Screen of Screens, including the Greenblatt Screen. So, like a number of months in the past, I am going to keep it in the portfolio.
A nice easy choice.
This year has seen to living daylights knocked out of the portfolio. It has beaten the FTSE350 on a 1-, 3- and 5- year basis, but not a 2-year basis. The returns have hardly been what could be described as stellar, though. The FTSE350 is 8.5% lower than it was 5 years ago, and up only 5.2% since the portfolio started out in Feb 2011.
COVID-19 looks like it is about the resurge again. So far, it looks like my original prediction of COVID taking a year to sort out hasn't proved to be alarmist. My aim, as always, is to try to assess the the facts as soberly as possible. I applaud Paul Scott and his helpers for doing the same. The rise of the internet has bought with it the rise of hysteria, sensationalism and political reactionism. So it's good -…
