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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (7364)	10/3/1999 12:44:00 AM
From: Mike Buckley	Read Replies (1) \| Respond to of 54805

THIS MONTH IN THE FRONT OFFICE -- Part 2 The Front Office Gorilla Game The numbers as of the end of September: Year-to- History History Date Quarter Month Annualized Gorilla Game 100.67% 82.61% 3.40% 5.06% 67.47% S&P 500 15.51% 4.34% -6.55% -2.86% 11.27% Russell 2000 -7.71% 1.26% -6.64% -0.12% -5.77% There's no question that the Front Office Gorilla Game is showing remarkable outperformance of the indexes, especially in the first half of this year. The numbers aren't huge for the current quarter (Q3), but it is interesting that our game showed a modest increase when the indexes showed a somewhat dramatic downturn. The details about the stocks: Current 5/25/98 5/1/99 Change % of Buy Buy Average Current from Symbol Port Price Price Cost Price 5/25/1998 CLFY 15.5% $13.25 N/A $13.25 $50.31 279.72% RMDY 31.7% $17.44 $17.50 $17.46 $28.25 61.98% SEBL 48.8% $23.00 $38.44 $27.10 $66.63 189.67% VNTV 3.9% $27.63 N/A $27.63 $8.69 -68.55% Notice that Clarify is the best performer by a wide margin. That's not because of any particular gorilla-gaming fundamental. It was simply a matter of luck that Clarify began its major turn-around from previous problems not long after the game began. Depending on the week or month that we look at the numbers, either Siebel or Clarify is always the top dog. Right now honors certainly go to Clarify but it isn't always that way. The reason Clarify is a much smaller percentage of the portfolio than Siebel is because of Clarify's likely status of being a chimp forever. The final tally: Stocks $20,051.38 Cash $15.61 Total $20,066.99 A synopsis of how our Game has played out: The Front Office Gorilla Game began with $10,000 on March 25, 1998 with equal dollar allocations in each stock. On March 1, 1999, some shares of Clarify were sold because it had become apparent that there was little chance of the company becoming a gorilla. The percentage of the portfolio was too high considering that chimps are to be held lightly. Funds raised from the sale of Clarify shares were used to purchase additional shares of Siebel, the most likely of the four companies to become the gorilla, and Remedy, the chimp that is the next best thing to a gorilla because it dominates its niche of internal help desk software. The rules of the game: This is not a real money portfolio. Commissions based on $8 per trade. Interest earned on the cash is not accounted for because there is no material impact on the results. The importance of due diligence: I own shares of Siebel Systems, one of the stocks in the portfolio, and have owned long and short positions of other front office stocks including those in the portfolio. It is likely that I will at some time in the future own other positions in these stocks, so please do your own homework and don't base any decisions on information provided by me. --Mike Buckley