There are other people out there!

I was interested to discover the various blogs of people doing the magic formula investing thing. My first thought is these guys are much more sophisticated than me. I have a lot of respect for the knowledge and in depth analysis everyone else is doing. However, my second thought was that many people seem to be trying alternatives to the system set up by Joel Greenblatt. I started my MFI portfolio in March 2006 and I have been very happy with the results so far. Now, I fully realize it could be pure luck. But, it could also be that I am strictly following the guidelines in the book.

I have a friend who read the book and then said he could never do it because he's too much of a gambler. And, I'll admit, the temptation is always there. i.e.:

1. Hey! This stock is up tons, let's take the profit now!

2. This stock stinks. Time to dump.

3. This stock is doing so well, a year is up, and it's not on the MFI website anymore. Let's keep it anyway!

But, I always remind myself, don't try to time the market and don't try to be clever. I say to myself, "Self, BE DISCIPLINED!". So far, it has paid off. The purpose of this blog will be to share the results of strictly following the plan in the book. All forward looking, no back-testing.

Here's my current portfolio and results:

Sorry for the ugly looking post...it's my first one. It will be interesting to watch how this portfolio continues to do over a three year period. In theory since I'm pretty far ahead of the benchmark, one would expect that I will likely underperform for a period to bring it back to average. We'll see.

Next posts will talk about my HIGHLY SOPHISTICATED method of picking 'em and some of the thoughts I've had on the investments.

-A