Jeff Paul's  Instablog

I decided to apply my -20% sell signal to all of the DCC model portfolios.  MPR (Met-Pro) demonstrated a -20% gap from the S&P for 4 weeks ending Oct 28th (view 13-mo chart in Google Finance).  Based on my previous articles, this suggests the possibility of a future dividend cut and/or a further price decline.  Therefore it was sold on Oct 28 ($9.27/sh), and replaced with Brady Corp (BRC) @ $31.65/sh, as it was the next Industrial stock on the screening list.

The small cap portfolio will be rebalanced in the near future.  I will stagger rebalances (different end-of-quarters) for my three portfolios, to make it easier for me to keep up with them and report on a monthly basis.  Small cap will rebalance at the beginning of Dec, the Aristocrat model in Jan, and the Inc/Growth model in early February.  Rebalances are planned to be annual, though individual stocks may be replaced due to div cuts, buyouts, or -20% signals.  A full rebalance could occur if the market has a major up or down move.  

This is a little late...sorry...in my small cap model DG portfolio, ORRF suspended its dividend on Oct 27th.  Therefore, it was removed from this portfolio at the closing price on that date, and the proceeds, plus cash (~$7200 total) was invested in the next financial stock on my screen list, LARK as of that date.  

The small cap portfolio currently has a gain of 3.19% since mid-August, vs 0.62% for the S&P.   

Unfortunately, this portfolio did not own HGIC (it was next on the list), which got bought out for a 100% premium.  Given the volatility of smaller cap stocks, I plan to increase the number of holdings to 40 or 50 at the year-end rebalance, to reduce exposure to any specific firm.   This will also increase the chances of owning a buyout candidate, though also to have a div cut stock. 

Two of my previous recommendations posted excellent results and continue to improve margins.  See the articles below for the stories behind these companies. Check SA or Yahoo Finance for the recent earnings release and conference calls.

seekingalpha.com/article/283579-fei-comp...

seekingalpha.com/article/280955-gardner-...