The DIMEX

[cantab]

A new index has been established based on Dimebag's ASX selections as posted on the NZX channel.


quote:Originally posted by Dimebag

Hi Quartspurple

I currently hold positions in the below ASX companies (ranked in the order of my preference, based on various factors):

Astron (ATR)
Oriential Technologies (OTI)
Credit Corp (CCP)
City Pacific (CIY)
Alliance Finance (AFC)
Fantastic Furniture (FAN)
Ion (ION)

I generally look for companies in their early to mid stages of development that are conservatively priced relative to their potential.

Cheers
Dimebag


I'm keeping track of Dimebag's portfolio. I've invested a theoretical $100,000 spread evenly over the 7 stocks, with the starting point being the closing prices on the 24/6/04, the day Dimebag gave his selections.

As at 9 July the portfolio is worth $111,450 which is good going in just 11 trading days!

The DIMEX which has a base of 100 now stands at 111.

Opening prices as at 24 June 2004: ATR $2.60, OTI .175, CCP $2.13, CIY $4.28, AFC .50, FAN $4.03, ION $1.76

Closing prices as at 9 July: ATR $3.10, OTI .22, CCP $2.16, CIY $4.56, AFC .59, FAN $4.22, ION $1.84

Cantab

[thereslifeafter87]

Cantab,
Thats classic!

Although, in fairness to dimebag, shouldn't the index be heavily weighted in favour of ATR? sort of like Telecom in the NZX50...
:)

[cantab]

thereslifeafter87, fair comment from Dimebag's point of view however Dimebag's portfolio came up in response to a question from a poster as to what ASX stocks others would recommend. The DIMEX doesn't (as yet) measure Dimebag's actual portfolio rather it measures how well Joe investor would do from putting an equal amount into each of Dimebag's portfolio stocks. Personally I think that ATR's prospects and risk profile justify a much higher weighting than the other 6 index components. Dimebag listed his portfolio in order of preference so I would acknowledge on that count alone an equal weighting is flawed. Using actual market caps would work against potential small, high growth stocks like OTI. The best thing may be to let Dimebag come up with the weightings or base the DIMEX on his actual weightings.

Cheers

Cantab

[KD]

I'll sell out and just buy the DIMEX I think...

At a guess I would say Dimebag might be getting twitchy with SDI - could I be so bold as to ask whether, at current SP ($8.70), this might be the case (if so - at what rank in the list).


I sifted through my list of "excellent" companies with expanding earnings and, amongst most of those listed above, SDI cropped up and headed the list in terms of value (AFC aside given short earnings history), hence the question.





quote:Gerry

Was interested in your current thoughts/opinions on SDI.

You were very interested in SDI about six months ago and I was wondering if you are still holding, and are still optimistic.

The stock was $10.70. It peaked at $12.20 early this year, and has since fallen to $8.65.

I've only looked briefly into SDI but likey you have been impressed with the quality of their operation. However, as detailed in my previous post, I was not so impressed with the price.

However, the stock is now selling at $8.65 and the forward PE is now only 25x. With the FY results beckoning, this will soon become a historic ratio with prospective earnings growth over the FY2004/05.

The price seems much more reasonable if earnings growth is set to continue over the next 5 years at rapid rates.

Interesed in your views (or anyone elses)

Dimebag (none held)

[KD]

I need to clarify the above - In suggesting SDI "headed my list in terms of value" I was only considering 1) stocks that I did not currently hold and 2) stocks with longish record of earnings growth. So I'm not suggesting SDI is better value than ATR, OTI or ION as I hold these. I'm also not suggesting SDI is better value than AFC as AFC has a short record. However high up on my list were stocks such as CCP and FAN ... SDI seems better value and I was kinda wondering whether Dimebag might think so too, at present....

cheers

[The P.O.D.]

I wouldn't get too carried away with dimebags selcetions. For example his picks for the ASX competition aren't going that well. Every dog has his day in the sun.

Revhead won the asx comp two years running with some extremely impressive results. However his picks this year aren't doing that well.

One thing that does come to mind with dimebag however is his confidence in significantly over-weighting a particular stock if he feels it due. That is where his main success lies. For example, for large proportions of the previous year I would imagine Dimebags portfolio would of been at least 60-70% in ATR. For the 'average' punter this is very risky.

[thereslifeafter87]

POD,
who actually picks stocks they would buy for the ASX comp?
Most people pick penny dreadfuls, or stocks they think are due for a good run in order to maximise returns over the short period that is a year.

[Dimebag]

Cantab

Thanks mate. :) Interesting idea. Will be interesting to see how it pans out. An equally weighted indext is no problem. It will give a better indication of an overall methodology's ability to pick numerous winning stocks instead of just a few.

POD

Yes you are correct my ASX comp picks are going terribly. I have concluded that the reason they have failed so miserably is that I stepped (partially at least) outside my actual investment methodology in selecting the picks.

The problem is that the competition was only of 12 months duration so I focused on picking stocks I thought would do well over this 12 month timeframe instead of focusing on long-term value as I like to do. I also picked a few species reasoning that to win the comp very big percentage gains would be required. In this case they appear to have failed somewhat.

Cheers
Dimebag

[cantab]

Clearly there is some interest in the DIMEX.

The base is 100 as at 24 June 2004 and represents $100,000 invested equally in ATR, OTI, CCP, CIY, AFC, FAN, and ION listed in the order of preference by Dimebag as at that date.

To recap, as at 9 July the DIMEX stood at 111 with the portfolio having increased to $111,450.

As at the close of trading on 5 August the DIMEX stood at 112 and the portfolio was valued at $112,297.

Closing prices at 5 August: ATR $3.02, OTI .215, CCP $2.40, CIY $4.78, AFC .55, FAN $4.68, ION $1.70

I will update the DIMEX each month.

Cheers all

Cantab

[k1w1]

Cantab, thanks for your work on the Dimex :)I am assuming that all dividends are included aka NZX 50 or is the current 112 purely capital gains.

The reason I am interested is that dimebag single handedly stopped the rally in the ASX: RPC thread. After reading that post about 20 times I couldn't fault any of it. Even though my heart said stay as I had been riding from 27c up I then sold after reading Kiwi's chart as well.

I think he is a very talented analyst. I remember reading when Warren Buffett started out ( no pressure Dimebag !) on his own he just had a few friends and backers. I am publicly musing about The Dimex Fund.

It would need an accountant type or someone like you cantab to be the stakeholder. Anyone interested in at say $1000.00 per head.To regard this investment as a total loss ie not expect to get it back for a long time ; Sole choices of stock to be by dimebag which stakeholder would then execute. Standard 1% pa of gross value of fund to Dimebag Funds Management to fund his university studies.

I would be in. don't know about anyone else ?

[The P.O.D.]

I have included it as a benchmark in the asx competition based on the above 7 stocks.

Search on "asx comp july update".

[Nimble]

Cantab, When you first mentioned this on the NZX forum thought it was a great idea, glad to see it in action.

K1w1, would be keen as well. However very aware a number of these stocks are relatively illiquid which may make it difficult for a fund of any size to purchase significant volumes without moving the price too much. Although that said both Cantab & David Rob have managed to secure significant volumes in OTI at very attractive prices, which is probably the most illiquid of these.

Thanks also to Dimebag for your continual commentary on the various forums and for sharing your portfolio.

[cantab]

Hi K1W1 and Nimble,

To this point, since it commenced on 24 June, the DIMEX has been constructed as a capital index rather than a gross return index, however I acknowledge that it would be more realistic to include dividends so I will have a look at that.

Interesting idea to have Dimebag as a fund manager like Carmel Fisher. Who knows, it could happen one day. I am guessing that crossing the dividing line from share club to fund manager where Dimebag takes his cut could mean some complex regulations to comply with. It's a great idea though. The good thing is that anyone can now replicate Dimebag's portfolio.

Cheers

Cantab

[k1w1]

Well then what about a "shareclub" that all votes for Dimebags choice of sale/purchase and each year makes a " donation" of 1% of gross to our favourite charity - the Dimebag Educational Opportunities Fund

[Dimebag]

Hi Cantab

Thanks for the update. I'm actually pleasantly surprised the index was up from the last update! A few stocks have some back a bit (ION, ATR) but some nice rises from the likes of FAN and CIY to offset. Must have been my personal portfolio's overweight position in ATR (which has my portfolio down over the past month) which made be expect the retracement.

Its been all good luck so far though. None of the movement has been announcement driven. 12% six and a half weeks is clearly an unsustainable growth rate in the absense of stock rotation. I'm sure they will tumble just as quickly in less fortunate months when the market is weaker.

We need a longer time frame to get a realistic picture. Still, so far so good!

Thanks again. I look forward to next month's update, after which all of the companies will have released their full year accounts! Hopefully things will be looking up.

Thanks again
Dimebag

[Dimebag]

Nimble. No problem its a pleasure :). In return thanks to all the other fellow-posters out there for the opportunity to exchange ideas and information! It has been of immense value over the years.

K1w1: Sounds good ;)

Regards
Dimebag

[cantab]

It's time to update the DIMEX. :) Reports are out and the market has had plenty of time to give the thumbs up or down. Let's see how Dimebag has been going:

To recap:

The base is 100 as at 24 June 2004 and represents $100,000 invested equally in ATR at $2.60, OTI .175, CCP $2.13, CIY $4.28 , AFC .50, FAN $4.03, and ION $1.76, listed in the order of preference by Dimebag as at that date.

As at the close of trading on 30 September 2004 the DIMEX stood at 115 and the portfolio was valued at $114,791.

This was compared to 5 August when the DIMEX stood at 112 and the portfolio was valued at $112,297.

Closing prices at 30 September with 5 August figures in brackets:

ATR $3.19 ($3.02) , OTI .17 (.215), CCP $3.07 ($2.40), CIY $4.36 ($4.78), AFC .58 (.55), FAN $4.88 ($4.68), ION SOLD at $1.61 ($1.70)

One notable event occured on 6/9/04 when Dimebag sold all his ION at an average price of $1.61 resulting in a loss of $1217 on his original base cost price of $1.76. Dimebag then immediately switched all these funds into ATR at a cost of $2.90. The model portfolio reflects the realised loss on ION of -$1217 and the revaluation on the new ATR shares of +$1306. Dimebag has effectively all but doubled his weighting of ATR in the model portfolio.

Please note that this is a capital index, accordingly no allowance has been made for dividends.

So in just 3 months anyone replicating the DIMEX would now be showing a 15% gain excluding dividends. Impressive stuff.


Regards

Cantab

[skinny]

Impressive stuff indeed - well done Dimebag!

Cantab, I thought it would be interesting to benchmark the 15% ex-dividend return in the DIMEX against a couple of choices that should be of interest to sharetrader land:

1) ASX small cap index (ticker XSO).
This is the most relevant naive benchmark given the DIMEX is mainly small cap shares and has no over whelming sectoral weight. The ASX has moved from 1930 to 2100 over the past 3 months, returning a very nice 8.8%.

The DIMEX's good performance may in part be due then to a bull run in smaller cap shares. That said, its still outperformed the index by a very credible 6.2%.


2) The bear favourite - the price of gold.
June 30 spot price $393 USD. Sept 30 $415 USD.
Gross USD return 5.6%.
AUD June 30 0.695, Sept 30 0.724. AUD appreciation over past 3 months 4.2%
Gross AUD return around 1.4%

One day gold bugs, one day :D

p.s. incidentally since I'm having a dig at the gold bugs its only fair I put in the skinny portfolio performance over the past 3 months. It has a 3/14 over lap with the DIMEX (i.e. OTI, ATR, AFC) but is more geographically spread with equity stakes in the evil US empire. It returned 16.6% incl. dividends, 15.2% excluding :D:D

[Halebop]

I think Skinny is proposing the SKINEX!? Certainly beats the HALEBOX last 3 months - a fraction above breakeven and mostly due to interest from being predominantly in cash. This time last year there were plenty of obvious bargains but now the pickings seem slimmer to my eyes.

Nice movement on the Dimex although in fairness to Dimebag I think ION should be removed at Dimey's exit price rather than counted at the current market price.

[skinny]

HB, no I wouldn't propose the SKINEX at all - far too flaky - will probly be slammed on Monday as one of the 'stars' over the past quarter, AJL, was suspended from trading on Friday for failing to provide its annual report on time to the ASX [B)]

The HALEBOX safety deposit scheme is a much safer bet with a catchier name to boot :)

[cantab]

Hi Skinny, Halebop.

Interesting comparisons Skinny. That was a nice performance from the XSO, and it is lower risk being diversified. Your performance was very good considering the movement in the $US.

Halebop, I removed ION at Dimebag's average exit price of $1.61 and purchased ATR at Dimebag's buy price of $2.90 from the sale proceeds. I share your reluctance to purchase shares in a hot market. There is always the risk of a pullback, or something coming out of left field. There is much less risk buying when things are cheap. I'm sitting on the sidelines myself to an extent.

Cheers

Cantab

[Dimebag]

Hi Cantab, Skinny and others

Thanks for the update Cantab (and the comparisons Skinny). Appreciate the effort. It's nice to see the index tracking nicely so far.

I look forward to the next update.

Regards
Dimebag

[k1w1]

How did this end up ?

[cantab]

As at 31 December 2004 the DIMEX fund closed with a value of $114,339, having commenced with an intial $100,000 on 24 June 2004.

Opening prices as at 24 June 2004: ATR1 $2.60, ATR2 $2.90, OTI .175, CCP $2.13, CIY $4.28, AFC .50, FAN $4.03, ION $1.76

Closing prices as at 31 December 2004: ATR1 $3.24 +25%, ATR2 $3.24 +12%, OTI .13 -26%, CCP $3.15 +48%, CIY $4.70 +10%, AFC .60 +20%, FAN $4.90 +22%, ION was sold at $1.61 for a 9% loss.

The performance of OTI -26% pulled down the performance of the Dimex but even so a 14.3% gain (not allowing for dividends) was pretty good going for just 6 months.

Dimebag showed how nimble and astute he was when he sold his ION at $1.61 and switched into ATR at $2.90. The DIMEX was adjusted to allow for the sale of ION and the reinvestment of those funds into ATR2.


DIMEX at close 31/12/04 = 114

[dingdong]

quote:Originally posted by cantab

The performance of OTI -26% pulled down the performance of the Dimex but even so a 14.3% gain (not allowing for dividends) was pretty good going for just 6 months.


A worthy return but it has to be noted that the All Ords went up 15% over the same period. So the DIMEX has not outperformed the general market.

[Dimebag]

Thanks Cantab

Just one thing - FAN had a 11:10 split. Adjusted opening price = 403/1.1 = 366.36. Up by 33.7%. That might just tip me over the ASX performance hurdle, which Abdab quite rightly points out is the true test for performance.

OTI has spoiled things really, but one can't make excuses. I'm considerably less enthused about this stock now. It may do well, but there are large opportunity costs to waiting for a company to churn out worthwhile performance. The likes of ATR and CIY are already performing well.

I like the look of GTP. I've made good money on UOS, GTP, and SDG over the past few months, but these, unfortunately, weren't included in the index. I still like GTP, UOS to a lesser extend, and am not so enthused about SDG, at current prices.

CIY and ATR are by far the most preferred. If I could propose an updated portfolio, it might look something like this:

ATR 25% $3.24
CIY 25% $4.70
CCP 10% $3.15
GTP 9% $4.21
FAN 8% $4.90
AFC 7% $0.60
OTI 4% $0.13
UOS 4% $1.40
IMF 4% $0.95
KIA 4% $0.64

Cheers
Dimebag

Cheers
Dimebag

[cantab]

Hi Dimebag, thanks for pointing that out, I've adjusted the figures accordingly.

The DIMEX finished with a closing value of $116,076

The DIMEX closed at 116, up 16% so you outperformed the ASX! Well done mate. :)


Cheers

Cantab

[cantab]

Here is the DIMEX as at 31 January:

$116,076 reinvested as per Dimebag's new portfolio allocations, now worth $116,377 +0.3%

ATR 25% $3.20 -1.2%
CIY 25% $4.99 +6.2%
CCP 10% $3.25 +3.2%
GTP 9% $4.76 +13.1%
FAN 8% $4.87 -0.6%
AFC 7% $0.65 +8.3%
OTI 4% $.135 +3.8%
UOS 4% $1.23 -12.1%
IMF 4% $0.88 -7.4%
KIA 4% $0.26 -59.4%

Dimebag, I suggest that you be able to trade a couple of times during the year, so let me know if you make any changes.

Cheers

Cantab

[Dimebag]

Sure

Thanks Cantab

Got stung on KIA during the month. Basket case there. Fortunately it only comprised a small portion of the portfolio.

Cheers
Dimebag

[k1w1]

Could we have an update on this please Cantab.

[dingdong]

My unworthy observation is that now the Dimex is no longer going upwards, it is no longer updated.

[k1w1]

Abdab, as at close of market yesterday:


Co %of Dimex Previous SP 14/06/05 SP

ATR 25% 3.20 2.43
CIY 25% 4.99 4.23
CCP 10% 3.25 2.98

Someone else like to take it from there ?

[Dimebag]

Hi Abdab / k1w1

Yes, it can't be denyed that all bar one (AFC) of the DIMEX stocks have performed terribly over the past few months, in terms of share price performance.

By my calculations, at today's close, the dimex stood at $95,053 (exclusive of dividends), down 18.3% from last time and about 5.0% overall.

Individual stocks:

Stock, weight, previous, current, %change

ATR 25.0% 3.20 2.45 -23.4%
CIY 25.0% 4.99 4.19 -16.0%
CCP 10.0% 3.25 3.00 -07.7%
GTP 09.0% 4.76 4.30 -09.7%
FAN 08.0% 4.87 3.60 -26.1%
AFC 07.0% 0.65 0.78 +20.0%
OTI 04.0% 0.14 0.04 -69.6%
UOS 04.0% 1.23 1.25 +01.6%
IMF 04.0% 0.88 0.75 -14.8%
KIA 04.0% 0.26 0.04 -84.2%

Not a flattering performance to say the least.

The interesting point, however, is how this performance has diverged from the fundamental performance of many of the picks. In particular, the top 6 weighted stocks have continued to perform splendidly.

The current chart shows the change in earnings per share reported in the previous interim reporting period:

ATR +152%
CIY +64%
CCP +53%
GTP ~+50%
FAN +26%
AFC +22%

All companies continue to track towards satisfactory full year results and none have downgraded earnings expectations (baring CIY's "quasi" downgrade).

What appears to have happened is a sharp movement away from the type of stock the DIMEX is primarily comprised of (small cap, illiquid, growth stocks). Whether this trend will be reversed in due course remains to be seen, but clearly the share market performance of these companies cannot continue to diverge so sharply from their fundamental performance for too long. Either:

(1) The negative sentiment driving these share prices will eventually be reversed with the continuing release of positive earnings developments; or
(2) The fundamental performance of these companies will deteriorate to reflect the existing downturn in there market valuations.

Which senario will ultimately prevail remains to be seen. Naturally, I'm hoping it is (1), but I could be wrong. But if it is (1), it should be remembered that as a fundamentalist, in the short-term it is harder to be smarter than your dumbest competitors! Based on underlying corporate performances the stocks should not have performed this badly.

With respect to the remaining four companies, UOS continues to perform well but the remaining 3 have been big disappointments. IMF still has potential, but KIA and OTI (especially KIA) have been basket cases. Fortunately, their weightings were relatively low, perhaps reflecting a subconscious lack of conviction about them.

Personally, I sold out of all my OTI between 11c-16c, and sold the small holding I had in KIA for 29c for a shocking loss. "Stephen Fleming"'s take on the situation was absolutely correct and prophetic. I learnt a lot from that ill-considered detour and let my guard down on that one.

IMF has not been such a disappointment but earnings development has underperformed expectations. OTI at current prices is probably worth holding on to, but I believe KIA will go to zero. If I'd been paying more attention to the Dimex these stocks would have been divested long ago.

Nonetheless, the results must stand. However, I would like to drop KIA, IMF, and OTI out, and reduce the AFC weighting by 30%. In itys place, I would like to substitute ARP @ $3.25 for 75% of the balance, and add to FAN for 25% of the balance.

The current holdings, and adjusted weightings (reflecting the changes in prices), will therefore look like this going forward.

ATR 2.45 (22.7%)
CIY 4.19 (26.8%)
CCP 3.00 (11.5%)
GTP 4.30 (11.1%)
FAN 3.60 (9.8%)
AFC 0.78 (7.6%)
UOS 1.25 (4.3%)
ARP 3.25 (6.2%)

DIMEX = $95,053 @ 16 June 2005

Regards
Dimebag

[k1w1]

No problem with a reconstituted Dimex 1 but as Warren Buffett said it is important to keep the unpleasant truths as well as the pleasant ones.

So I would ask that you keep the Dimex as well as the Dimex1, it has its own story to tell too.

[K9]

Hi Dimey

This Steve Fleming is very very good

not only a warning

but a 10 bagger on SSI


can`t say that`s a fluke

This fellow does his homework and I will be watching what he says...

and that hasn`t happened much on Ster apart from ATR;) for me.


R
C9
as controversial as ever[:p][^]

[Cooper]

I agree C9, SF posted a cautionary word on HWE which allowed me to get out in time. Well worth listening to.

[stolwyk]

I don't think that in these quickly changing times, someone can be asked to keep the same stocks for ever.

Gerry

[K9]

:D:D:D

well found, isn`t it true how guilt finds the guilty



well done Gerry[:o)][:I];)

nice stand ...well done[B)]

[Halebop]

Didn't Mr Fleming say he worked in an insolvency related field? I'm sure if he here's any names via "shop talk" then its well worth a pause for thought.

[dingdong]

quote:Originally posted by stolwyk

I don't think that in these quickly changing times, someone can be asked to keep the same stocks for ever.

Gerry


Never a truer word said or more worthy statement made, O Stolwykos God of Ramping. I await your disposal of those unworthy and depreciating gold stocks.

[k1w1]

quote:Originally posted by stolwyk

I don't think that in these quickly changing times, someone can be asked to keep the same stocks for ever.

Gerry


If you are practicing Warren Buffett style " buy and hold " then it should be over at least a 3 year period unless there is risk - in which case you should not be holding them at all.

[Lizard]

quote:Originally posted by k1w1

No problem with a reconstituted Dimex 1 but as Warren Buffett said it is important to keep the unpleasant truths as well as the pleasant ones.

So I would ask that you keep the Dimex as well as the Dimex1, it has its own story to tell too.


Ummm, so where do we look up performance of the K1W1ex?

Same place we find the Lizard index

[Lizard]

Scarey! I think if anyone ever started a Lizard Index, I would have to scuttle back under my rock ;) Go Dimebag!

[k1w1]

quote:Originally posted by Lizard


quote:Originally posted by k1w1

No problem with a reconstituted Dimex 1 but as Warren Buffett said it is important to keep the unpleasant truths as well as the pleasant ones.

So I would ask that you keep the Dimex as well as the Dimex1, it has its own story to tell too.


Ummm, so where do we look up performance of the K1W1ex?


Don't look at me, I bought RMG shares - and the Major would put my MFS and MPY in the same pile.

[k1w1]

Updte please..

[Dimebag]

Stock Old New %ch
ATR 2.45 2.85 +16.3%
CIY 4.19 4.65 +11.0%
CCP 3.00 3.35 +11.7%
GTP 4.30 3.01 -30.0%
FAN 3.60 3.99 +10.8%
AFC 0.78 0.94 +20.5%
ARP 3.25 2.85 -12.3%
UOS 1.25 1.27 +01.6%

Value of DIMEX = $101,314 (+6.6%)

ASX Change
old 4246.50
current 4461.60 (+5.1%)

Comments:

Much stronger performance from the DIMEX over the past two months, posting a 6.6% rise, outperforming the benchmark ASX-200 by 1.5% and and pulling the overall index back into positive territory.

Strong rebounds from CIY and ATR helped the index recover. Most stocks performed well, although heavy losses were sustained on GTP, following disappointing sales figures. The newly incorporated ARP also suffered disappointing losses following a full-year profit downgrade.

The DIMEX continues to stand by these picks over the longer-term though.

Cheers,
Dimebag

[Dimebag]

PS

By way of comparison, $100,000 invested in the ASX-200 as at 24-June-04, when the dimex commenced, would be worth $126,266

(4461.60/3533.50)*$100,000 = $126,266 (+26.3%)

The DIMEX certainly has some catching up to do!

Cheers,
Dimebag

[Dimebag]

Update:

ATR 2.85 2.89 +01.4%
CIY 4.65 3.90 -16.1%
CCP 3.35 5.00 +49.3%
GTP 3.01 3.05 +01.3%
FAN 3.63 3.55 -02.1% [adjusting for 11:10 split]
CAF 0.94 0.79 -16.0% [previously symbol AFC)
ARP 2.85 2.86 +00.4%
UOS 1.27 1.26 -00.8%

Value of DIMEX = $101,593 (+0.3%)

ASX $129,447 (+2.5%)

Comments:

Further underperformance I'm afraid, although the CIY comparision is somewhat unfair given that the stock has a very high dividend yield and went ex-dividend a 30cps FF dividend during the period.

Good gains from CCP offset by poor performances from CIY and CAF.

ATR remained quiet at 2.89, edging up from 2.85. I regard this stock as the "sleeping giant" of the portfolio. CIY also has much potential, but continues to stubbornly sell at what I see as unjustifiably low valuations.

Time will tell. I'll post this for now; may consider a few adjustments.

Cheers,
Dimebag

[Dimebag]

Update

ATR 2.89 3.94 +36.3%
CIY 3.90 3.78 -03.1%
CCP 5.00 5.35 +07.0%
GTP 3.05 3.60 +18.0%
FAN 3.55 2.93 -17.5%
CAF 0.79 0.80 +01.3%
ARP 2.86 2.72 -04.9%
UOS 1.13 1.15 +02.2% [adjusted for 15cps capital return]

Value of DIMEX = $110,901 (+9.16%)

ASX = $137,580 (+6.28%)

Comments: Good performance by the DIMEX over the past couple of months. Outpaced the ASX-200 but still a fair amount of catching up yet to do.

Highlights: ATR finally came alive, but mixed performances from the rest of the picks. CIY continues to languish and disappoint.

Will post some adjustments shortly

Regards,
Dimebag

[Dimebag]

Adjustments:

Drop FAN & CAF: combined weight to reallocate = 14.20%

Allocate as such:

CPK 6.20% $ $2.90
HHL 4.50% @ $7.12
WCG 3.50% @ $1.385

Also, place half of GTP into TIM @ $3.16

Summary of picks & current weightings:

ATR 31.30%
CIY 20.72%
CCP 17.58%
CPK 06.20%
ARP 04.55%
HHL 04.50%
GTP 03.98%
TIM 03.98%
UOS 03.80%
WCG 03.50%

Cheers,
Dimebag

[absolut-advance]

Great Thread.

Go the DIMEX!

[Nimble]

Dimebag

Interested to learn a little more about your methodology if you have time to explain.

1. What do you use or calculate to rank your shares? e.g. Why is ATR first versus say WCG last? For example do you estimate price in 5 years time using estimated EPS multiplied by forecast PE multiple, then calculate annual % price increase to achieve your estimated 5 year price then rank on this %.? However this wouldn’t really take into consideration each shares unique risk profile.

2. Once the order or rank is established. How do you calculate your weightings?

Many thanks in advance. I am sure a few others would be interested in knowing as well.

[Dimebag]

Hi Nimble,

Nothing scientific. The rankings & weights are based loosely on my subjective assessment of the relative risk/return characteristics of the various stocks, and also on how the stocks have performed since inclusion in the index. If a stock goes up, its weighting will increase, etc. CCP has performed very well, so its weighting is now pretty high.

As can be seen, ATR and CIY are stocks I rate as being particularly attractive at current prices.

Cheers,
Dimebag

[Dimebag]

Update

Stock;old;new;%ch

ATR 3.94 3.75 -4.8%
CIY 3.78 3.48 -7.9%
CCP 5.35 6.60 +23.4%
CPK 2.90 3.38 +16.6%
ARP 2.72 3.34 +22.8%
HHL 7.12 7.55 +6.0%
GTP 3.60 3.80 +5.6%
TIM 3.16 3.40 +7.6%
UOS 1.15 1.20 +4.4%
WCG 1.385 1.215 -12.3%

Value of DIMEX: $114,813 (+3.5%)

Value of ASX: $138,336 (+0.5%)

The DIMEX continues to outperform, gradually clawing back its accumulated underperformance.

This 6-week performance is particularly gratifying, given that the index's two largest holdings, who together comprise about half of the index, declined by 4.8% and 7.9% respectively during the period. All the other picks, bar WCG, substantially outperformed. I remain confident that the performance of ATR and CIY will reverse at some point.

From an amendment perspective, I'd like to remove WCG and replace it by adding to CIY @ 3.48

Cheers,
Dimebag

[thereslifeafter87]

I was wondering how long that was gonna take.

WCG's not your usual type of stock.