07/15/2012 going off the deep end

Small Portfolio	XLF & IAU	8.19%
Position	Date	Return	Days
GCI	7/14/2011	10.25%	367
CSGS	10/3/2011	38.92%	286
NLY	10/25/2011	10.64%	264
KBR	10/27/2011	-18.93%	262
VG	10/27/2011	-42.25%	262
BT	1/4/2012	11.22%	193
SAI	5/30/2012	3.61%	46
XEC	6/5/2012	4.20%	40
DECK	6/15/2012	-2.10%	30
CVX	7/5/2012	-1.27%	10
S&P	Annualized	0.77%
Small Portfolio	Annualized	7.28%
Large Portfolio	Annualized	7.41%

Sell GCI; buy RIMM

Today the model goes off the deep end and sells a newspaper to buy a nearly doomed wireless company: RIMM.

We’ve all heard of RIMM: Blackberry, crushed between iPhone and Android.  I still use a Blackberry, but only because every time I think of getting an iPhone I hear a rumor that the next iPhone will be so much better that I should wait.

Of course, the next iPhone might not be so revolutionary and the next Blackberry might finally have a breakthrough – like the new camera feature that preserves the three seconds BEFORE each shot so you can scroll back to the instant before your nephew blinked in the family shot.

Right now the camera is the worst feature in Blackberry.  In a few months it will be the best.

All of this is speculation.

The model only knows that the company still has strong fundamentals and the industry has strong technical accumulation.

And that’s enough.

You can’t trade unknowns.

In any case, both models are holding a small annualized gain over the S&P.  Gold has been holding back the small portfolio (if I had just traded sectors it would be up 13.31%).  Fundamentals have been holding back the large portfolio – perhaps the most maddening part of all.

I’m looking forward to Value stocks actually showing some of their value for a change.

Tim