Gintel on Cube.............
Making Money In Mutuals Concentration Worked For Gintel In April
Peter McKenna
05/08/98 Investor's Business Daily Page B2
(Copyright Investor's Business Daily, Inc. 1998. To Subscribe Call (800) 733-8900.)
Green Tree, CheckFree Helped Managers Post 12% Gain
Gintel Fund rose 12% in April, making it one of the top-performing funds for the month. It wasn't an easy month, either. The S&P 500 scratched out a 0.88% gain after surviving a nasty three-day plunge.
The fund, which was started by Robert Gintel in 1981, is up 11% so far this year, behind the S&P 500's 16% rise. But the $200 million fund carries an A grade from IBD, ranking it among the top 10% of funds with its 36-month total return of 122%.
Earlier this week, we asked Gintel, 70, and co-manager Cecil Godman, 38, what worked for the fund last month and how their holdings are positioned going forward.
IBD:
Gintel fund gained in April, a bad month overall. Why?
Godman:
We take large positions in just a few stocks. Some of these stocks did well last month.
IBD:
How many stocks does the fund hold?
Gintel:
We have 23 holdings and assets of $200 million. Currently, 65% of the assets are invested in seven stocks.
IBD:
Maintaining such a small portfolio sounds a bit risky.
Godman:
Not if your research is good and you pick the right stocks. If your picks are good, the risk is actually lower than having a lot of stocks.
IBD:
That would be a tough theory to prove.
Godman:
Well . . . the S&P 500 is used as the benchmark for diversity, and the Gintel Fund has beaten the S&P during the last five years. We mitigate risk by picking the right stocks and holding them for an average of two to five years.
IBD:
OK, let's talk about stock picking. What stocks drove your performance in April?
[snip]
IBD:
It looks like we can't argue with your stock picking. What do you look for in a stock? But first, what's the one loser in the portfolio?
Gintel:
It's C Cube Microsystems. We have a $300,000 unrealized loss on a $5 million investment. We haven't given up on this stock. It's a digital video disc company; when the DVD industry takes off, C Cube should do well."
[snip] |
