2017 stock picking competition - April update

by Doug Morris, CEO, Sharesight | Apr 12th 2017

With one quarter and an earning’s season in the books, it’s time for our second update on the Sharesight & Livewire stock picking competition!

In December 2016 we sent the call out for your picks for the 2017 calendar year. We’re comparing the performance of the most popular picks from the Sharesight customer base, the Livewire readership, and some of Australia’s top fund managers -- and of course tracking them in Sharesight.

featured - 2017 stock picking competition - April update

We checked in on each portfolio in February and the Sharesight customers were well ahead of the pack. So where do we stand now?

Performance since 1 January 2017

The tables have turned. Livewire reader picks have returned over 3%, the Expert Picks managed a small gain, and the Sharesight customer picks are in the red. None of the portfolios have beaten the benchmark.

We’ve also had a late entrant to our competition. Six Park, one of our robo-advice partners, saw our blog and asked if they could get in on the action.

I told Pat Garret, their CEO, that indexers were always trying to cherry pick opportunities to make stock pickers look bad so he agreed to acknowledge their portfolios are just that -- constructed portfolios -- whereas our stock picking competition is based on individual picks with no regard for what else an investor might hold.

Let’s think of our indexing friends in Melbourne as friendly umpires. Six Park charges 50 basis points annually. We’ll levy that fee at the end of the competition. I reminded Pat that the only constant in investing are the fees you pay.

Portfolio Total Return % Total Return $
Sharesight -0.85% -$4,276.36
Fund Managers 0.58% $2,898.13
Livewire 3.12% $15,589.71
ASX 200 (STW)
6.21% $6,202.78
Six Park - Aggressive Growth 4.02% $20,080.45
Six Park - Balanced 3.21% $16,042.75

What’s driving the returns?

Though the Sharesight portfolio is currently in last place, their pick of Sirtex Medical (SRX) is up a blistering 23%. This masks the dog in their portfolio, Retail Food Group (RFG), which has lost 23%.

The Livewire portfolio has been fairly even keel with QBE Insurance (QBE) delivering over 8%, and Altium (ALU) down 3%.

The Experts’ selection of Imdex (IMD) is the best returning stock of their portfolio, up 10%. Event Hospitality (EVT) is down almost 5%.

Dividends buoy some of these returns to be sure, something especially true of Australian stocks. Centrepoint Alliance, an Expert pick and our dividend leader, paid out $4,726.41, which nearly makes up for their $5,900 capital loss.

As for Six Park, their allocation to the Van Eck Infrastructure ETF (IFRA) and the Vanguard Emerging Markets (VGE) ETF has been their best performers -- each up just over 7%.

Remember the best way to analyse the return characteristics of these portfolios is to request access and run a Contribution Analysis Report.

Portfolio notes

  • We’ve “invested” $100,000 in each holding while assuming a brokerage fee for each buy transaction of $9.95.
  • All dividends are/will be included in the total performance calculation, and are reinvested. Total performance also factors in currency effects.
  • Performance figures are total return (versus annualised) as none of the portfolio positions has been held for longer than one year.
  • The benchmark return figure assumes that all $500,000 was invested in the benchmark ETF.

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