I want to make a confession, one many might find bizarre coming from any equity investor and especially from one who has been a professional in the markets since 1980. Are you sitting down? Hopefully you are. OK. Here goes: I have no idea what stocks I own. (And I hate being asked at social gatherings, even among other market-pros, what stocks I like. But I have at least gotten better at changing the topic.)
Really! I can't name a single one, and I have a lot, almost 100.
By the way, I'm not talking about funds. These are individual-company stocks, the sorts of entities I spent almost 20 years calling, analyzing in detail, and writing about back when I was at Value Line and which I continued to write since then on various web sites. (Speaking of funds, I also have about 10 closed-ends, but I am consistent; I can't name any of those either.) I should mention, too, that I made each of these trades myself, so it's not as if I can plead ignorance as a result of having given somebody else trading discretion regarding my money.
How, you may wonder, did I get 100 or so stocks and about 10 funds into my account without knowing what they were? Good question.
Here's how I did it. At specific intervals, I went onto Portfolio123, opened up the models I saved there and which I use for real-money investing. I download the newest up-to-date stock lists into Excel spreadsheets. I copy the tickers onto another spreadsheet I saved as something like “Trading Folio – Model Such-and-Such”). I also copy the percentage weights each ticker is supposed to have. I check to see that the weights add to 100.00 and if they don't (as can happen when decimals get rounded), I manually fudge it to get the total to be correct. And then, each of these spreadsheets gets uploaded into the appropriate part of my account at FolioInvesting.com. And that's that, until the next rebalancing date comes around.
I could see what stocks and funds I'm buying and selling if I want to. The spreadsheets I download form Portfolio123 show me the up-to-date holdings lists. But I don't care. I just copy the tickers. As I enter the information into FolioInvesting, that site shows me what I'm buying and selling. I still don't care. I just scroll down and keep clicking on the icons needed to get me to the next screen and to complete the process as quickly as possible.
Is This Approach REALLY Prudent?
Yeah, it is. Actually, I'll go one up. I think it's more prudent than focusing on the individual names. Doing it this way, while I may not know specifically WHAT I'm buying and selling, you can bet your you-know-what I know exactly WHY I'm trading as I am. And that, I believe, is where the money is: It's in “why,” not “what.”
It's been 18 trading days now since I've been disseminating the picks from my Cherry-picking the Blue Chips stock model as a portfolio on Harvest. For those new to this model, it's one I make available for free on Portfolio123's Ready-to-Go platform. It was described in detail here on March 12, 2015. That introductory article included an 18-slide PDF presentation in which I explained in detail what the buying and selling rules were. And I shared some test data that supports my belief that this is a good set of rules. (And by the way, this is not data mining. Every rule is supported by a valid reason, the sort I'd feel comfortable discussing with anybody, Warren Buffett, Ben Graham, you . . .)
