armin's stock selection

Buy & Hold by the Book

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Scot asked he would love to see more blogs explaining the whys and whens of timing and selection. Well, I couldn't find a simpler way of doing that: 20 quality stocks in, very little action whether rebalancing or buying new positions regardless market would suggest otherwise. What do I expect to get out by the end of this competition?First, most probably not very spectacular performance, second, less risk as all of us know the evidence that indicates that a diversified portfolio of securities, for example 20 randomly selected stocks, holds much less risk (measured by the standard deviation of returns) than an individual security. This follows because:
* The standard deviation of returns from a single stock in a portfolio is much larger than the standard deviation of the entire portfolio.
* The standard deviation of returns on a portfolio declines as the number of stocks in the portfolio rises towards 20.
more,
and third, kind of sensation that I haven't tempted any action that could be related to any kind of whether greed, fear or timing.
I know, this approach is both boring and not attractive, but in the same time, I believe,simple, understandable, would be repeated ad infinitum and experiment free.
By the way, I really love when Warrenn Buffett says:" Our time frame is forever" and very curious to know how his time frame might look if it lasts just one second longer! Imagine performance!

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love is blind

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an odd opinion about apple
inspired by book:KARAOKE CAPITALISM

We have heard already people talking about apple in a language usually reserved for small, fluffy animals and close family members! If you like more soul than life, lick the buttons( Steve Jobs once said: " We made the buttons on the screen look so good you'll want to lick them" ) and wow experience you get all in one apple! If your company has to hire a new CEO, you hire Steve and you'll most likely have a true Chief Emotional Officer also. It seems like that magic apple has a synesthetic content, too..
But AAPL is about first, being fit by creating business models that are well adapted to the new business conditions and second, being sexy by building and creating emotional innovations and moods that attract and addict customers. In my opinion the company has the answers about what does the apple sound, feel, taste or smell like.
I'm not smart enough to predict whether share price will double or triple, but for sure more emotions will be added in any product they deliver so driving the sales.
Who will win, fundamental or emotional analysis?
I believe both, the latter being the likeliest place to imagine its future value.

Would like to listen about apple through your compilation!
Voila!

btw-I bought AAPL for SLO portfolio on very first day of this competition, will hold until end.

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Trades report

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I had to sell all quantity of NGA (North American Galvanizing & C) due to erroneous showing of its current value on portfolio page, making ranking of portfolio incorrect as result. Bought 930 shares of CBI (CHICAGO BRIDGE & IRON N.V.) instead.
Strategy remains the same: buy & hold

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Why I question that...(part 1 and 2)

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Part 1
You Don't Need An Education to Get Rich?

New York Times article by Louise Story, offers a variation on the theme. It says that with so many quant whizzes getting rich at hedge funds and private equity firms, many of today's best and brightest -- or at least the mathematically gifted -- are skipping M.B.A.'s and going straight to the trading desk.

There is no doubt that the article suggests education isn't really everything, but not much of a lesson either. Not only the connection between education and wealth breaking apart but the Plato quote dating 427 BC as well. Why? As per his words a hero is born among a hundred, a wise man is found among a thousand, but an accomplished one might not be found even among a hundred thousand men. The most probably a hedge-funders here are heroes with a short shelf life, too.
Undoubtedly, a kind of panacea I wouldn't take counsel, albeit their apparent skills. Consequently, one might question their attitude, too.

Part 2

Bookstaber Asks: Where Were the Risk Managers?

Bookstaber Asks: Where Were the Risk Managers?

Former fund manager, Wall Street risk manager and now author Richard Bookstaber reviews the recent losses in mortgages, leveraged lending and hedge fund quant trading and asks if firms' top risk managers prepared properly for the periodic blow-ups that occur from time to time in financial markets.
I ask also!

Welcome your comments!

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Half way through the open seas report

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At sea,sailing vessel Astra, North Pacific, Date Line
As you might remember I'm on board the sailing vessel Astra together with crew of 20 quality stocks, undertaking a virtual journey, crossing North Pacific, applying simple buy & hold with little change strategy. We crossed Date Line yesterday and rised flamboyant spinnakers to help us making a second leg. She is loaded with various cargoes from RobertKingsbury's Magick Boxes to ores, coal and fertilizers.
We are busy preparing all available storm sails to weather incoming winter season over the North Pacific. You lucky, if you're sailing in the eye of the storm during that period of time. Life on board is relatively calm, crewmembers having fun too. We're reading all blogs from page one for example about how Eileen Teska taking care of Family trust or motivating words coming from duffbeer saying:
I am an ex USAF military guy 69-73. I love aviation. A bit of get there fast comes through my investment plan.However I was on the much slower prop jobs AC 47 and AC 119 gunships - fast they are not . I love the jet speed but realize they like ships can not be turned around fast.
I must admit I love the rise in Bidu but also love the way you invest ,steady as she goes ----
starting at port a and making safe passage across rough waters and arriving with all critical mass in tack,
docking in port b .
Aye aye Captain
while you drink that jug of rum I'll have a DuffBeer,
Cheers, DuffBeer

Cheers to all participants!
Armin

Astra graph:

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