I have worked out a few more cases of Don's Feb '95 to July '98
sector rotation using some Dow stocks. Sorry I can't get them
to line up as nice as Don does, still trying to work out going
from spreadsheet to SI thread. As you can see, Don's
off-the-cuff example of Coca-Cola was spooky in that he picked
the best one of the few that I have looked at so far. Wal-Mart
was a close second with Merck and Citicorp not doing to bad.
Also, there was no consideration of dividends. I was kind of
suprised that Hewlett-Packard does not lend itself well to this
strategy. Maybe because it is a tech stock it is to closely
synchronized with the semi-equips.
KO MRK CCI WMT HWP GM ALD XON
2/95 Buy
$50k semi-equip
net
worth $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000
9/95 Sell
semi-equip
for 100% gain
pay 50% tax
and rotate
into ?
at x/share 35 54 72 25 42 48 23 36
net worth $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000
4/97 Sell
? at x/share
pay tax and
get into
semi-equips 58 88 120 30 52 56 37 56
net worth 99,643 98,611 100,000 82,500 83,929 81,250 97,826 95,833
9/97 Sell
semi-equip for 100%
gain pay 50% tax
and rotate into
? at x/share 60 100 136 37 70 67 42 64
net worth 149,464 147,917 150,000 123,750 125,893 121,875 146,739 143,750
share price of
? as of 7/10/98 87 132 171 64 58 71 43 71
net worth 216,723 195,250 188,603 214,054 104,311 129,151 150,233 159,473
annualized
rate of
return from
2/95 to 7/98 54 49 47 53 24 32 38 40 |
