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The Shareswatch Random Stocks Portfolio: May 2011

May 12th, 2011 · Greg Atkinson · 5 Comments

It has been quite some time since I have looked at the Shareswatch Random portfolio of Australian stocks simply because the Australian stock market has been basically going nowhere for a year or more. So it will be interesting now to see how this collection of S&P/ASX stocks has been tracking to determine if it is tracking the performance of the ASX 200 Index.

The Shareswatch Random Portfolio is not weighted and is simply a collection of S&P/ASX 200 listed companies that were selected via a random number generator. So I do expect it to perform somewhat differently to the ASX 200 Index, but my expectation is that it will reflect over the longer term, the movement of this stock market index.

As a starting point for the review of the portfolio let’s have a look at what the S&P ASX 200 has been doing for the last few years.

S&P/ASX 200 Index 3 year chart


The last time I wrote about the Random Portfolio was back in June 2010 and since then the ASX 200 has edged up around 6% or so.  So as I started looking at the stocks in the portfolio I expected that not much would have changed with perhaps a few stocks falling back a touch, and a few rising a touch.

Overall I expected the portfolio to be showing a gain of 20-30% which would reflect the gain in ASX 200 since October 2008 – the month in which the Shareswatch Random Portfolio was set up.

But to my surprise the portfolio now has an unrealised gain of around 53% which I would imagine is better than many (most) actively managed portfolios are doing. (including my own!)

Shareswatch Random Portfolio May 2011

Three stocks are responsible for most of the gains in the portfolio: Challenger Financial Services Group (CGF), Monadelphous Group Limited (MND) and Riversdale Mining Limited (RIV).

The last two stocks are resources related and that highlights how this sector is holding up the overall Australian stock market. (and economy also)

Most other stocks are trading around where you would expect they would in a stock market that is not moving much with the exception of perhaps Onesteel (OST), which is getting dragged down by higher commodities prices and the strong Australian dollar.

Platinum Asset Management (PTM) has slipped back since June 2010 which I did not expect to see while the Woolworths (WOW) share price has barely moved.

Gunns Limited (GNS) and DUET Group (DUE) remain basically where they were back in June 2010 and look like they will both be a drag on the portfolio for some time.

I don’t expect the portfolio to hold onto the current unrealised gains through the second half of the year as I am bracing myself for commodities prices to fall. This would put downward pressure the share prices of  Riversdale Mining and Monadelphous Group thus dragging down the overall portfolio performance.

Please note this Random Portfolio is NOT meant as an endorsement or recommendation of any of the stocks contained within it nor is anything in the above article intended to act as any form of financial advice.

The Shareswatch Random Portfolio is a random selection of stocks from the ASX 200 range of companies. For further details regarding how it was constructed please see: The Random Portfolio

The current stocks prices of the companies on the portfolio can be viewed here: Stock market quotes and stock prices

5 responses so far ↓

  • 1 Anon // May 17, 2011 at 2:08 pm

    Nice return greg!

  • 2 Greg Atkinson // May 17, 2011 at 2:29 pm

    Well Anon I never actually put a cent ino the random portfolio..silly me. It was/is just a random selection of stocks I am tracking. But it does make me wonder how many fund managers it has outperformed?

  • 3 Anon // May 17, 2011 at 2:47 pm

    Well next time, when you setup the random portfolio, you’ll take your own advice 😛

    Re: Outperforming other funds, you probably beat alot Greg. With abit of searching, there would be figures around showing average hedgefund / mutual fund returns for similar period(s).

    I know thats a good figure from just my experience in tracking hedgefunds. Now gotta beat them on the way down!

  • 4 Greg Atkinson // May 19, 2011 at 7:34 am

    I am going to box myself in and not sell anything for 5 years, which reminds me I need to set some rules up beforehand about what stocks can be sold. That will almost take the human out of the process completely!

  • 5 Stillgotshoeson // Dec 22, 2011 at 10:36 pm

    Thinking of putting one up in the new year for “entertainment” purposes.

    The stocks should not be considered buy recommendations, though the list will contain some I do own.. and the rest will be ones I actively watch.

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