Intelligent Investments: Current Portfolio

Sunday, November 12, 2006

Current Portfolio

For my first post, I'll simply display my portfolio and some of my reasoning behind my holdings. Currently, I own 5 Fidelity Funds, 2 Wasatch Funds, a micro-cap fund, one exchange traded fund, and 5 stocks. I am slowly moving my money over to stocks, trying to avoid to big a tax hit.

My mutual funds are:
Fidelity Select Energy Fund Current Value: $6,359.68 Cost: $5,000
Fidelity Select Health Care Current Value: $5,482.49 Cost: $5,000
Fidelity Low Priced Stock Fund Current Value: $39,612.18 Cost: $24,782
Fidelity Leveraged Company Fund Current Value: $60,250.56 Cost: $48,968.03
Fidelity International Discovery Fund Current Value: $14,283.44 Cost: $10,000
Wasatch Small Cap Growth Fund Current Value: $22,145.90 Cost: $13,675.33
Wasatch Core Growth Current Value: $49,465.91 Cost $25,235.98
Perrit Emerging Opportunities Current Value: $11,148.77 Cost: $10,0000

All stocks and the ETF bought within the last two weeks from redemptions from fund above.

ETF- Claymore-Sabrient Stealth Portfolio (STH) Bought 250 shares @26.65
Coach (COH) Bought 100 shares @38.41
News Corp (NWS) Bought 100 shares @21.70
Anheiser Busch (BUD) Bought 100 shares @47.60
Genentech (DNA) Bought 100 shares @83.76
Getty Images (GYI) Bought 80 shares @43.47

Cash: 381.69

No comments:

Buffett's Value Formula (?)

Warren Buffett hasn't exactly published his formula for what he calls the intrinsic value of a company, but he has dropped a number of hints. He apparently multiplies estimated future earnings by a confidence margin between zero and a hundred percent (a bird in the bush being worth 0.5 birds in the hand, and all that; bush birds are the earnings you hope for, and hand birds are the earnings you're confident will materialize). He then compares these probable earnings with something he has total confidence in, by using a U.S. treasury yield as his discount rate. In calculator form it looks like this:

This calculator doesn't use fancier math than the original one did. Its advantage is that it forces you to be explicit about your earnings expectations. It also automatically provides you with a hard-headed investment strategy: always invest in government bonds, unless you can find something else you are confident will yield more cash.

One other hint that Buffett has dropped over the years is that he can estimate value in his head in about five seconds; so whatever he does he keeps it simple, slugger.