Photo below was taken on Mar. 27 at Bill Greiner’s annual economic forecast breakfast. From left to right (with year of Washburn degree): Bill Greiner (1980), Professor Weigand, Scott Wells (2006, 2014), Lu Zhiqiang (2014), Dr. William Powell (1950), Jo Halley, Max Halley (1966), Xiaoyun Yu (2014), Bobby Florence (2014), Michael Stephens (2014), and Samir Hakal (2014).
The Student Investment Fund matched the returns of the S&P 500 over the 2013 calendar year with a total return of +28%.
The SIF remains overweight in healthcare (Bristol-Myers, Johnson & Johnson and Medtronic), industrial (United Technologies, Emerson and Deere) and telecom stocks (Verizon).
The following table shows the SIF portfolio’s returns by sector, compared with the returns of the corresponding sector ETFs. The SIF active stock selections earned higher returns in the financials, healthcare, information technology and consumer staples sectors. The SIF lagged in materials (Barrick Gold), industrials, utilities, energy and consumer discretionary stocks (a rare underperformance for McDonald’s). The SIF’s 1-year return of +28% was 0.6% higher than it would have been had the portfolio been invested in SPDR ETFs, which shows that overall, our active management strategy was successful during the past 12 months.
The following table shows the dividend yield of the SIF by stock sector. The SIF active stock selections had higher yields in all sectors except for material stocks. The SIF’s weighted dividend yield of 2.83% was 1.17% higher than it would have been if the portfolio was invested in all SPDR ETFs.
The following table shows the SIF beta by stock sector. The SIF active stock selections had lower betas than the corresponding ETFs, except in the industrials, utilities, information technology and financials sector. Overall the SIF had a beta of 0.835. Had the portfolio held all ETFs instead, the SIF’s beta would have been 0.985.
The following table shows the Treynor ratios of the SIF by stock sector (Treynor ratios measure excess returns per unit of beta risk). The SIF’s Treynor ratio of 1.99 was slightly lower than the Treynor ratio of a similarly-weighted portfolio of sector ETFs would have delivered (2.02).
The table below shows the SIF’s current positions and the weight of each position in the SIF portfolio. The fund’s market value was $122,426 as of December 31, 2013.
The table below shows the SIF’s weighted average P/E ratio, dividend yield, free cash flow yield, return on assets, return on invested capital and operating margin. Most fundamental portfolio characteristics are within acceptable limits with the exception of the average P/E ratio, which has become elevated during the market’s extended bull run in 2013.
-- Datasource: Standard & Poor’s Capital IQ