You mean like now, but a bit earlier…
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In my mechanical dividend strategy Thompson Reuters paid a market dividend today. Since they sold the Reuters Terminal they do nothing but rise, nice.
The money I distributed to GIS, HST, JNJ, O, T and VTRS.
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KLG did overpass the agreed buying price of $23 from Ferrero yesterday? Is the buyout probably not that sure?
I still hold KLG because the 6-month rule, thinking about selling in August. Any ideas what the price movement is based on? Usually the price stays under the buyout price minus interest and some risk premium.
From what I understand, you have a 6 months holding rule because of the famous Kreisschreiben, not because it’s a part of the actual strategy. I wonder why you stick with it, as you are heavily using leverage and out of safe zone anyway?
Actually I don’t. Debt is less than real estate, as you can see here debt is 14.7% of taxable estate: Mechanical investment strategies - #98 by cubanpete_the_swiss
Translating to real estate I would have a total mortgage of less than 30% what is extremely low for Switzerland. So yes, I adhere to the rules of Kreisschreiben 36 to have some legal certainty.
And another beautiful bride: Brighthouse Financial, part of my mechanical momentum portfolio, did rise 10% after hours because of a WSJ article mentioning talks about a buyout.
And yet another stock market month is over. New highs all over, wonder how long this may last.
The dividend portfolio:
content (finviz)
Dividends paid: KMB,MRK,MO,HST,ONL,O and CSCO
A nice market dividend got to me from Thompson Reuters (TRI).
The dividends and the market dividends went into JNJ, O, GIS, HST, T and VTRS
The carry premium (cashflow consisting of dividends plus market dividends minus withholding tax minus debt interest) is now at 6.38% for this year.
Margin multiplier at 100.3%, almost no debt. Debt at the moment is only so that I don’t have to re-invest dividends every few days.
Performance YTD 7.13%, XIRR since 2014 10.39% and since 2020 12.9%
wheel of fortune dividends and positions:
And now for the momentum portfolio:
Leverage here is at actual 132.48%.
Performance YTD 9.8%, XIRR since 2020 26.73% per year. Lags a bit this year…
Wheel of fortune:
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Finally some action. My captain made me sell Cracker Barrel, a bit early for my taste. 5.6% gain in 6 months.
It had to go to make space for Sanmina. It is not the first gig for SANM in my portfolio, last time it was quiet a success. I hope they can repeat that.
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Do you calculate on a USD basis?
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Yes.
Gulfport starts its third year with me in the momentum strategy, therefor sold a little. Is at +56% which is more or less average for this strategy.
And in the dividend strategy finally I could sell Kellogg, 6 months since last buy. With the money I bought more GIS and PFG.
Today for my momentum strategy I had to sell The Honest Company and Gulfport with 61% and 45% gain. Had to make space for Global Industrial Company.
Well, you chose the right time for HNST - after-market looks shit 
Waiting for a rebound.
My momentum strategy is a roller coaster ride. Earnings season, yesterday my two single most weighted stocks were on fire: Supermicro went down 18% (again) and after market Tutor Perini went up almost 22%.
SMCI and TPC are by far my biggest winners in USD, while TPC will overtake SMCI today. A complete surprise, a construction company, come on. Of course a lot of luck because both are double positions. Remember, I just double down when I need to invest money and don’t find an investment for some time in the momentum strategy.
BTW: I did not choose to sell Honest, I just needed money for a buy. Seems we are in the middle of some changes, much work for me. In August usually there is not much action, this time it smells like work.
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Dividend strategy:
A bit sad today, had to say goodbye to an old warrior: Thompson Reuters was sold today. The gain is gigantic, in addition to the 11 years of dividends. Since they sold the Reuters Terminal the valuation went through the roof, they got too expensive. And now they slipped to the lower half of momentum, so they had to go.
With the money I bought the Loews insurance arm CNA financial. They have really bad analyst ratings, and as you know you get rich if you do the contrary of what analysts or banker tell you. There was some money left, I did add to the Viatris and the Gilead science positions.
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And again there was some action in my momentum strategy. What an August, normally there is nothing to do…
I sold Corebridge Financial with a gain of 45% and with the money I bought Visteon, the car parts supplier:
One problem for my mechanical momentum strategy: timing. OK, timing is a problem for everybody, but I made my rules with Kreisschreiben 36 hanging over my had like the sword of Damocles.
Usually it is not a problem. But distribution seems to have changed now, many new companies to include. Sometimes I don’t have a single one for 3-4 months (!).
All my positions that are older than 6 months except one have around 50% gain, some much more. All my positions that are older than 12 months have more than 100% gain, some much more. Of course this is because I get rid of losers as soon as possible (remember: hold as long as possible but not longer).
But 21 of the 31 positions I actually hold are with me less than 6 months. Most of them won’t make it to 12 months. Without Kreisschreiben 36 I probably would sell a bit earlier and therefor keep some of my winners longer.
More than 2/3 of my positions are new, OK, TPC is an exception because it was a double down. Usually that much change has some fundamental reason…
It is a luxury problem. The 6 months are actually quiet good as minimum holding period for this strategy. And the sell points are historically very good. Only 16 of my last 76 sells over performed my strategy average after I sold them. 4 ceased to exist and 56 made less after I sold them than the positions I kept holding. So thank you Kaspar, you helped me create my strategy.
If they never asked for documentation of trades in the past in don’t think the 6 months will be an issue…
I hope so. However, they did ask for documentation of trades, apparently to explain the rise of taxable value last year that was higher than the income declared. Should have spent more…
Better safe than sorry.