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    I am now using this blog to re-post some comments I make other blogs. For my full management blog see the Curious Cat Management Blog

    Friday, April 22, 2005

    10 stocks for 10 years

    Topic: Investment

    I decided to look at selecting a portfolio of stocks I would be comfortable putting into an IRA for 10 years. My main criteria was companies with a history of large positive cash flow (that seemed likely to continue that trend).

    The 10 stocks I came up with are (closing price on 22 April 2005 - % of portofilo invested):
    • Templeton Dragon Fund (TDF - 16.40 - 16%) - a closed end mutual fund investing in China, Hong Kong, Taiwan, Singapore... This one doesn't fit the criteria but does a great job of filling out the portfolio in my opinion.
    • Dell (DELL - 36.43 - 12%)
    • Toyota (TM - 72.42 - 12%)
    • Google (GOOG - 215.81 - 12%)
    • Pfizer (PFE - 27.22 - 8%)
    • Amazon (AMZN - 33.04 - 8%) They are only just starting to generate cash but I like their prospects.
    • Intel (INTC - 23.24 - 8%)
    • Petro China (PTR - 61.68 - 8%) Investing in PTR is based on the potential for China, the prospects for oil over the next 10-20 years and Warren Buffet's ownership of the stock.
    • Cisco (CSCO - 17.43 - 8%)
    • First Data (FDC - 37.48 - 8%)
    Thankfully I don't have to staying locked into decisions for 10 years. But, if I had to, this is a portfolio I would feel comfortable with today. It is overweighted on technology (which is another reason for including Petro China). Templeton Dragon Fund also provides a nice counter weight to all the technology. I would like to have a higher exposure to heath care, but I couldn't find the stocks that seemed equal to those above.

    I have been using marketocracy, since 2001, to manage a portfolio of stocks (marketocracy does a great job of tracking performance for you which I find quite convenient). This year my fund has suffered. At the beginning of this year the Darvamore Fund has exceeded the S&P 500 by over 10% annually on average). This year however the fund's overall performance results have been reduced to just 5.5% over the S&P 500 annually. Hopefully that trend will turn around soon.


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