Investing For Growth - Friday, September 06, 1996

Investing For Growth

What You'll Find Here | The IFG Approach Explained | The IFG Statistics Center

Friday, September 06, 1996

The Daily IFG Report

(FOOL GLOBAL WIRE)
by Robert Sheard (MF DowMan)
LEXINGTON, KY. (September 6): After less threatening employment numbers this morning, stocks rebounded somewhat from yesterday's shellacking (especially the one taken by the Nasdaq). Another day with no company-specific news, but a nice bounce back nevertheless.

This weekend is the update weekend for the monthly Investing For Growth variations (both the IFG with Relative Strength) and my new, as yet un-named, model. Unfortunately, this week's Value Line was a no-show today at all three of my local library branches, so this weekend's updates are not likely to be posted until sometime Sunday. I'll do everything possible to get the IFG Statistics Center files posted as quickly as possible, but it lies to some degree in the hands of the post office, bless their souls.

The way the update works for the IFG/RS model, of course, is that after re-running the current rankings numbers, I'll "sell" any stocks from the current holdings that are no longer on the list and take those funds and spread them evenly across the replacement stocks without re-balancing all ten positions.

In my newer model, each month begins with an assumed perfect balance for the ten (or five) holdings. The theory I'm testing with this approach is to see if by regular re-balancing, we can protect the gains from our big winners by spreading them out among the other stocks so that one stock doesn't become too large a position. There's an advantage and two disadvantages to this practice, of course. The advantage is the portfolio protection against a stock becoming so over-weighted that if it collapses, it carries the whole portfolio down with it.

The two disadvantages to re-balancing regularly are more trades and whatever compounded gains one would lose by pulling money out of a winning stock on the way up.

All that said, the short-term data we have (5 years) seems to suggest it works fairly well as a protective measure against collapses like we witnessed in Micron Technology, America Online, Iomega, and a few years ago, U.S. Surgical.

Enjoy the weekend, Fools. I'll get those numbers posted as soon as I get my copies of Value Line and Investor's Business Daily.

Transmitted: 9/6/96

The Current IFG Stocks

Coca-Cola
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:KO)") else Response.Write("(NYSE:KO)") end if %>
Quick & Reilly Group
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:BQR)") else Response.Write("(NYSE:BQR)") end if %>
Paychex
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ:PAYX)") else Response.Write("(NASDAQ:PAYX)") end if %>
Nautica Enterprises
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ:NAUT)") else Response.Write("(NASDAQ:NAUT)") end if %>
Mirage Resorts
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:MIR)") else Response.Write("(NYSE:MIR)") end if %>
Tellabs
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ:TLAB)") else Response.Write("(NASDAQ:TLAB)") end if %>
SCI Systems
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NASDAQ:SCIS)") else Response.Write("(NASDAQ:SCIS)") end if %>
Nike
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:NKE)") else Response.Write("(NYSE:NKE)") end if %>
Claire's Stores
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:CLE)") else Response.Write("(NYSE:CLE)") end if %>
The Gap
<% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:GPS)") else Response.Write("(NYSE:GPS)") end if %>

Today's IFG Numbers

INVESTING FOR GROWTH MODEL (9/6/96) Day Week Quarter Year History IFG 0.95% -0.19% -3.67% 3.12% 4095.58% DJIA 0.94% 0.78% 0.09% 10.61% 582.87% S&P 500 0.96% 0.57% -2.23% 6.45% 515.55% NASDAQ 1.22% -0.18% -3.85% 8.29% 669.75% Bought # Stock In At Now Change 7/8/95 3866 TLAB 48.00 65.25 35.94% 7/5/96 5077 SCIS 39.88 46.50 16.61% 4/5/96 7695 CKP 26.75 29.25 9.35% 7/5/96 4153 PAYX 48.75 52.25 7.18% 7/5/96 4562 COMS 44.38 47.50 7.04% 7/5/96 6693 NRES 30.25 31.75 4.96% 7/5/96 8756 MIR 23.13 23.50 1.62% 7/5/96 4394 HWP 46.06 43.63 -5.29% 7/5/96 6402 BQR 31.63 28.38 -10.28% 4/5/96 10624 ROTC 19.38 14.88 -23.23% Bought # Stock Cost Value Change 7/8/95 3866 TLAB $185,568.00 $252,256.50 $66,688.50 7/5/96 5077 SCIS $202,445.38 $236,080.50 $33,635.13 4/5/96 7695 CKP $205,841.25 $225,078.75 $19,237.50 7/5/96 4153 PAYX $202,458.75 $216,994.25 $14,535.50 7/5/96 4562 COMS $202,438.75 $216,695.00 $14,256.25 7/5/96 6693 NRES $202,463.25 $212,502.75 $10,039.50 7/5/96 8756 MIR $202,482.50 $205,766.00 $3,283.50 7/5/96 4394 HWP $202,398.63 $191,688.25 $(10,710.38) 7/5/96 6402 BQR $202,463.25 $181,656.75 $(20,806.50) 4/5/96 10624 ROTC $205,840.00 $158,032.00 $(47,808.00) CASH $1,040.78 TOTAL $2,097,791.53 Transmitted: 9/6/96

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