inMessment Game – First Quarter Results 2012

Ii is the end of the first Quarter for 2012. Time to review my inMessment Game results.

To see earlier results from 2011, click the following links:

Q12011 | Q22011 | Q32011 | Q42011

I started the inMessment Game on Investopedia in December of 2010. The game now has a grand total of 11 players including me. As we start the second year, NOW is a great time to join the game!

Here is what you will see in this post:


inMessment Numbers as of March 30, 2012

The first quarter of 2012 was a great quarter. The inMessment Game Portfolio is up more than 10% in Q1. This is when investing is really fun!

  • Q1 Starting Account Value: $24,579.13
  • Q1 Ending Account Value: $27,226.73 (Up $2,647.6 (10.7%) from Q4 2011)
  • Annual Return: 6.73% (APY)
  • Number of Securities In Portfolio: 5
  • Trades this Quarter: 19
  • Available Cash: $4,392.53


Comparison to Benchmark – The S&P 500 Index

The benchmark I have chosen to compare my results to is the S&P 500 Index. This is a broad index of 500 of the top US companies. Many investors and firms use this index as a general benchmark.

The Blue line is my inMessment Game portfolio. The Red line is the S&P 500 Index. The S&P is up 12% in Q1 2012.

Here is the comparison chart since Jan-2011. The S&P and my inMessment Game portfolio are fairly close together. From time to time the inMessment Game portfolio is doing slightly better than the S&P Index. At the end of Q4 the S&P is having a great run and pulling away from my portfolio.

The Good

Two of my holdings did as well or better than the S&P 500 in Q1. These I consider good for the quarter. Nike ended up over 23%. As part of my new simplified strategy I sold Nike in January. BlackRock is the only single stock I still hold. It is up over 13% so far.

Name Symbol Last price Shares Mkt value Gain %
NIKE, Inc. NKE $101.79 0 $0.00 23.56%
BlackRock, Inc. BLK $204.90 10 $2,049.00 13.89%


The Bad

My bad list has only one stock this quarter. I list VMWare, Inc., not because it performed badly but because my trading of it was bad. In late December I had a 2% stop-loss hit on VMW so my position was sold. I still liked the stock and bought again in late January. Between the stop and the buy the price increased by nearly $7 a share. Then I saw VMW go up over $97 in February. I made a guess that it was near a top and I sold again. VMW has continued up steadily since then. What I should have done was to wait and let the stop-loss work again.

Lessons I am considering:
1) Set stop-loss orders more loosely to let stocks ride longer
2) Don’t sell if the stock is a solid choice. Let the stop-loss do the work.

Name Symbol Last price Shares Mkt value Gain %
VMware, Inc. VMW $97.01 0 $0.00 4.44%



The Ugly

I have two holdings in the Ugly list, EEM and SCZ. The Emerging Markets and EAFE small-cap stocks have not done as well recently. These both hit stop-loss limits on March 6 and sold. I lost nearly 10% on each of these. As part of my simplification this year, I have not bought back into these at this point.

Name Symbol Last price Shares Mkt value Gain %
iShares MSCI Emerging Markets Indx (ETF) EEM $42.94 0 $0.00 -9.80%
iShares MSCI EAFE Small Cap Index Fund SCZ $40.13 0 $0.00 -9.81%



Changes To The Portfolio

In Q4 2011 decided to simplify my portfolio and to start using stop loss orders. The biggest change from Q4 is the fact that I only have 5 holdings. I have cut my holdings in half.

I have also had some difficulty with a high number of trades this quarter. 19 total trades. 6 of these trades were stop-loss orders that hit. I am setting the stop-loos orders more loosely to allow a little more duration on holdings.

The other contributing factor in the high number of trades was decisions to sell when positions went higher. I have been looking at stochastic momentum indicators. Thinking some positions might be at a top I sold. I don’t want this to be a habit. I need to be patient with winning positions.

The high number of trades has cost me. The commissions for the 19 trades was $219.81. That is nearly 1% of the portfolio value. I would have been closer to my benchmark with fewer trades.

Below you can see the full portfolio and the trade history for Q1 2012.



Full inMessment Game Portfolio

Here is the full portfolio as of March 30, 2012.
I have categorized the investments in the following way:
Core: Long-term stable investments that will not change often.
Sub-Core: Still long-term but may trade more often.
Opportunity: Long or short-term trading opportunities.

inMessment Game Portfolio As of March 30, 2012

Name Symbol Last price Shares Mkt value Gain % Purpose
BlackRock, Inc. BLK $204.90 10 $2,049.00 13.89% Opportunity
Rydex S&P Equal Weight ETF RSP $51.87 100 $5,187.00 5.44% Core
iShares S&P SmallCap 600 Index (ETF) IJR $76.31 70 $5,341.70 2.58% Core
iShares S&P MidCap 400 Index (ETF) IJH $99.22 50 $4,961.00 2.02% Core
iShares Dow Jones US Real Estate (ETF) IYR $62.29 85 $5,294.65 2.22% Sub-Core
Cash $4,392.53 Core


inMessment Game Trade History for Q1 2012

Below is the trade history for my inMessment Game in Q1 2012. Too many trades and $219 in commissions hurt my portfolio this quarter.

Date Trade Type Symbol Quantity Price Total Cash Value
3/16/2012 Buy RSP 46 $52.02 $2,402.91
3/8/2012 Buy IJH 50 $97.06 $4,862.99
3/8/2012 Buy IJR 38 $73.47 $2,801.85
3/6/2012 Stop Loss SCZ 25 $38.38 $944.58
3/6/2012 Stop Loss EEM 54 $42.72 $2,291.89
3/6/2012 Stop Loss RFG 30 $86.94 $2,593.24
3/6/2012 Stop Loss IWR 25 $106.88 $2,657.01
3/2/2012 Stop Loss IJR 33 $73.86 $2,422.39
2/29/2012 Buy IJR 32 $75.09 $2,412.87
2/22/2012 Buy IYR 85 $59.95 $5,105.74
2/22/2012 Buy IJR 33 $75.27 $2,493.90
2/15/2012 Sell IJR 37 $74.56 $2,748.73
2/15/2012 Sell VMW 50 $97.01 $4,840.51
2/15/2012 Stop Loss IYR 50 $60.45 $3,007.51
2/3/2012 Sell PLD 44 $33.14 $1,448.17
2/3/2012 Sell MDT 30 $39.97 $1,188.96
1/30/2012 Buy IYR 50 $60.13 $3,016.49
1/27/2012 Sell NKE 25 $101.79 $2,534.76
1/24/2012 Buy VMW 50 $90.32 $4,525.99


Join the inMessment Game

Now that you have read through my results why don’t you join the game yourself? It is completely free and the best way I have found to learn about investing.
Click Here to Join the inMessment Game!


DISCLAIMER
This and other articles on this blog are for entertainment purposes. I am doing the best I can but I am still very much in a learning process. These posts are an effort to share this learning process only and should not be considered financial advice.


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