Q1 2014 Performance Review

Originally posted here: http://seekingalpha.com/instablog/71188-chris-lau/2828863-q1-2014-performance-review
To measure investment calls more accurately, positions added and removed throughout the quarter were recorded on Kapitall (off topic: which just made a major redesign today). The practice portfolio, which mirrors some of the real-world trades, peaked with a total return of 47.4%:
(click to enlarge)
The six-month performance looks much better, since it outperformed the S&P 500.
(click to enlarge)
6 Month return ~ 17%
Q1 2014 Return: ~7%
Chart as at April 10 2014
With the Nasdaq dropping 129.79 (3.10%) on April 10, 2014 and the S&P 500 dropping 39.10 points (2.09%), this portfolio might finally start to outperform the index.
The allocation in (AMD) continues to fluctuate. The chip maker is likely range-bound in the short term, but the intention is to build a large position throughout 2014. Closing below $4, AMD should be valued at much higher prices as profitability improves. The top three positions in this portfolio are:

1. Bombardier (BDRAF)
2. SeaDrill (SDRL)
3. BlackBerry (BBRY)

Note: $66,000 / $144,425 available in the Kapitall portfolio is in cash.
Companies viewed as having value include: Nuance (NUAN) and Arena Pharma (ARNA).
Position in Kindred (KIN) and (ADHD) might increase in the current quarter.

(Test) Post with Kapitall

 Kapitall.com is a fun, stock trading game that would appeal to new investors as well as experienced ones. To more accurately measure an investment thesis against actual practice performance, tools offered by Kapitall will be incorporated on this site.

So far, three portfolios created have cumulatively returned 30.9%. Although the market continues to drift steadily higher alongside lower volatility and lower volume, the cash levels on the Kapitall portfolios have increased to take advantage of future opportunities.

To test Kapitall's tools for sharing information, below is a chart on Chesapeake Energy.B denotes 'buy' and S denotes 'sell.' E denotes 'earnings' and D denotes dividend payment.

Chesapeake Energy contributed about 4% gains in one of the practice portfolios:




As QE2 or quantitative easing via POMO unfolds in the United States, look for U.S. currency to weaken.

Companies in the energy and gold sectors will benefit as demand for these commodities increase. Credit easing will also increase risk tolerance, which will support expanded price-earnings multiples for the stocks (investors will be eager to pay a premium).

Therefore, oil and gold companies would be an area of interest for investors.

Kapitall gets $7.3 Million to Jump Start 2011

Kapitall.com was introduced in an earlier entry. It is described as an online investing platform that combines the world's friendliest investing experience with powerful yet simple tools to build your skills.

Most recently, Kapitall closed $7.3M in financing in December.

A number of practice portfolios were created in 2010. The performance of two of the portfolios were good, returning between 29 - 31%, additional portfolios were created so as to track its relative performance against the U.S. Index, the activity of stock picks made by hedge funds, and that of China.

The goal of this blog for the year will be to note and comment macro events, and to keep track of stocks selected and invested in the kapitall.com playground.

The link for kapitall.com is here. Facebook users can login and connect to facebook friends that way. Look up "Chris Lau" so I may "share" my stock portfolio holdings and activity.

Fig 1: Portfolio Performance versus other indices:

Fig 2: Performance for $10,000 portfolio

Fig 3: Performance for $100,000 Portfolio

A note of caution! Both portfolios are trades since June 2010. Positive or negative performance for 2011 will provide a better indication on the success of trades made in the Kapitall playground.

An Introduction to video game-style investing: Kapitall.com

I signed up an account at Kapitall.com this past summer. Kapitall is a web-based game that introduces new investors to the complexities of the stocks, mutual funds, and exchange traded funds (ETFs).

This is accomplished by allowing users to create virtual portfolios and to manage play money.

Most recently, the site allowed users to open a TD Ameritrade account via Kapitall. Trades on Kapitall can be replicated on TD Ameritrade.

Since staff at Kapitall include game designers and former staff of Morgan Stanley, the site user interface is very unique.

This friendly environment will be very appealing to individuals who have never invested real money in the market. The industry and company filtering will also help individuals find relevant information very quickly.

The company information tab also points the user to SEC filings. This is useful feature for experienced investors looking to complete more extensive research on companies.

Below are some screen shots to illustrate some of Kapitall's functionality. Images are from my account.

1. Top Bar shows total return (27.6%), company search, skill level (bronze) and number:

2. A $100,000 portfolio ($100,000 portfolios are available when skill level increases)

3. A number of portfolios were created. 'Chinese Stocks' was a template portfolio. 'Speculative' is
a portfolio that was created to copy the moves of various hedge fund managers.

4. Holding Details for the 100K portfolio. Yep, cash is still king in this speculative trading environment:

5. Kapitall displays companies related to Microsoft, lists that include Microsoft, and funds that hold Microsoft. Why include Microsoft as an example? The market is under-estimating the impact of Windows Phone 7 (WP7), the value of Bing (0 to over 10% search traffic in a year is impressive), and long-term cash flow growth from sales of Windows 7.


















According to CruncBase, Kapitall has 60,000 active monthly visitors. For readers who sign up, look me up and connect as a contact.