Here are my 23 final picks for January Effect 2002:
I divide them in three categories, according to the quality of the company:
Low quality, but unlikely to go BK in the next 12 months:
EAG KPT CTT NCEH SNDT VLCT NEXM
Very low quality, might fail in next 12 months:
STHK DCH HEC IRSN MLRC ATMS UFAB VRTL MFNX CIO
POS, might go BK anytime:
LSATA.ob SBAS MCLD IMDS.ob ISCO.ob OPWR.ob
Here are 12-month charts:
finance.yahoo.com
I've linked a public portfolio of these picks to the opening message of this thread. I used my actual average price of the stock, but I don't include commissions, which will amount to roughly 1% of the investment, round-trip.
I bought all the stocks today, the next-to-last day of the trading year. Re. timing: if I had bought them yesterday I would have gotten better prices, and indeed I got better prices during the day than the closing price, because the port is up 4% for the day.
For the purposes of making the table easy to read, I've artificially assumed that I bought exactly $1000 of each stock, although I actually bought in different amounts, and I allocated more to the highest-quality issues and less to the POS issues.
In comparison to previous years, my picks differ this year because I include cheaper stocks (>$0.35) and I didn't use value criteria, except that I usually required a positive shareholders equity. Consequently, my picks are lower-quality companies than previous years, which is a change I made because I saw how Midland's picks outperformed mine last year. I chose a larger number of issues in order to diversify and reduce the risk.
My picks all have low 12-month RS and low institutional ownership. Many of them have declined in the last few weeks on higher-than-average volume, which is a characteristic of tax-loss-selling.
Good luck all! |
