Tin Cup Model Portfolio

Model Portfolio, by Mark Robertson, Managing Partner February 1st, 2013

Sell Abbvie, Buy Gentex and Qualcomm

Model Portfolio Update

Tin Cup managed to stay in 7-digit territory during January 2013, blowing through $1,000,000 on the first day of trading. We hope that milestone remains in our rear view mirror.

This demonstration portfolio invests the maximum allowable 401(k) in stocks situated at the upper end of the return forecast sweet spot. In the absence of choices within the portfolio, we shop outside the portfolio using the combination of return forecast and quality rating to identify candidates to be added to the portfolio. Total assets reached $1,000,000 in a little more than 17 years — something we’d hope that a nation of retirement planners and future retirees would notice, heed and deploy.

Tin Cup Dashboard: February 1, 2013. The holdings are ranked by PAR (last column on the right.) We add Qualcomm (QCOM) and Gentex (GNTX) based on their based on PAR and quality: http://www.manifestinvesting.com/dashboards/public/tin-cup

Gentex (GNTX). Excellent quality. Return forecast at 17%.

Total assets are $1,033,034 (1/31/13) and the net asset value is $232.16. The model portfolio gained 5.41% during January 2013. The S&P 500 checked in at 5.18% for the month. Tin Cup has generated a 4.3% annualized total return over the trailing five years vs. 3.9% for the S&P 500 for a trailing 5-year relative return of +0.4%.

Tin Cup has outperformed the S&P 500 over the trailing ten years by +1.2% and the annualized total return since 1995 is now 19.0%.

Portfolio Characteristics

With MIPAR at 7.2%, our target for the minimum overall portfolio PAR is at least 12.2%. The overall portfolio PAR is 13.1% on 1/31/2013. Quality and financial strength are sufficient at the current levels of 80.0 (Excellent) and 88%. EPS Stability is 85 for the portfolio. Sales growth is acceptable at 10.4%.

Decisions

Abbvie (ABBV) is a spin-off from Abbott Labs (ABT). We sold the ABBV position while the business model and forecasts “shake out” for this new Abbott child.

The proceeds from sale and our $1917 (and dividend stockpile) for February is destined and allocated to Qualcomm (QCOM) and Gentex (GNTX) — the two highest ranked candidates in the sweet spot at this time.

Mark Robertson

Mark Robertson is founder and managing partner of Manifest Investing, a source for research and portfolio management focusing on strategic long term investors.