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The last couple of weeks have brought equity performance into sharp focus as a stab of fear reaches out with uncertain markets. The problem is that we can easily be overwhelmed. The way to address this is to focus on what works in the long term, allowing us to filter out what may work in the short term but won't stand the test of time. We continue to examine different portfolios to see what we can learn and use to further our investment portfolios.

Anand Chokkavelu, CFA, is an editor and writer at The Motley Fool. He recently wrote that brilliant ideas can hide, but the truly, magnificently stupid ideas can't. They announce themselves with an unironic roar.

He selected seven great stocks and we entered these funds into our system and then compared them with a balanced portfolio of Dividend producing ETFs.

  • CMG (Chipotle Mexican Grill, Inc.)
  • TPX (Tempur Pedic)
  • MORN (Morningstar, Inc.)
  • BWLD (Buffalo Wild Wings Inc.)
  • RST (Rosetta Stone Inc.)
  • ISRG (Intuitive Surgical Inc)
  • WFMI (Whole Foods Markets)
  1. P 7 Great Stocks That Wall Street Is Missing -- Total of $10K invested equally in each stock
  2. Retirement Income ETFs Tactical Asset Allocation Moderate -- Above funds using TAA (40% fixed income, 30% for each of the top two asset classes)
  3. Retirement Income ETFs Strategic Asset Allocation Moderate -- Above funds using SAA (40% fixed income, 12% for each of the five asset classes -- funds selected based on price momentum)

Portfolio Performance Comparison

Portfolio/Fund Name

1Yr AR

1Yr Sharpe

3Yr AR

3Yr Sharpe

5Yr AR

5Yr Sharpe

Retirement Income ETFs Strategic Asset Allocation Moderate 20% 208% 3% 14% 6% 25%
Retirement Income ETFs Tactical Asset Allocation Moderate 14% 152% 9% 71% 11% 72%
P 7 Great Stocks That Wall Street Is Missing 54% 238%

Three Month Chart

click to enlarge


The more detailed analysis gives you charts and other properties of the portfolio

This is a portfolio with limited backtest ability because WFM only came into existence in 2009. This looks like an interesting portfolio to watch and see how it does going forward.

Disclosure: MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.

Disclosure: Author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 7 Stocks Motley Fool Claims Wall Street Is Missing