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 ...
Castings (LON:CGS) leaves the portfolio by rotation, having lost 17% since it was in the portfolio.
Tandem (LON:TND) enters the portfolio. It passes Stockopedia's Screen Of Screens and has a StockRank in the 90's. I've nothing to add other than that.
The portfolio has out-performed the market on a 1-, 3- and 5- year basis, and since inception. So, mustn't grumble.
I was going to comment last month as to how my picks in Stockopedia 2020 challenge went. I couldn't find the links at the time, but now I managed to locate them. Despite a good start, I noticed that my selections took a big hit during Covid, and I figured that my overall performance would have been in line with the indices, perhaps a little worse.
It turns out that my selections (British American Tobacco (LON:BATS), Norcros (LON:NXR), Reach (LON:RCH), $RDW, £SLP) returned 14.7%. he index itself returned -12.5%. In terms of ranking, I placed at position 1138 out of 2153. So, I did about average. So, strictly mediocre compared to everyone else who entered. What is more important, in my opinion, is that I managed to outperform the…
