Playing & Trading Strategy

Background

Some MOVIEFUNDS do better than others, rather consistently.  Over the last two years, I have noted some managers that consistently grow their funds to delist faster than other managers.  What is their secret?  Wouldn’t it be nice to harness their experience and ability and transfer that into one’s own portfolio?  I decided to choose a couple of Funds and to mirror their stock positions.  Here are the results of this experiment.

Method

I chose 2 funds (one theme fund and one studio fund) that had managers I have grown to trust.  I went through every stock they had and purchased 100k shares of each stock, exactly mirroring the fund – without prejudice.  This was difficult, because more than a few times, I thought they were on crack for choosing a position for a stock.  However, keeping true to the experiment, I did not apply my own experience or common sense to the choices.  Later, I sold off the stocks that were not moving in the manner I desired and kept the rest.  (I had to keep in mind that the stock position they were holding at a particular time could have been due to day-trading rather than their long term holding preferences.)

I revisited the funds weekly to update my holdings but as I gained experience, I started to apply my own judgment and chart history to my choices.  At no time did I “go against” the fund manager (that is to say purchase long when they purchased short), but rather used my judgment to agree or disagree with the choices.  I therefore would choose to buy/short if I agreed or pass on purchasing the stock if I did not agree.  That was the final evolution and is now the method by which I use this strategy.

Observations

Blindly holding stocks that a reputable/good/experienced fund manager chose was profitable.  Applying the agree/disagree filter made a big difference.

News/day trading kills any long term position.  What I did to manage this was sell 99990 of the shares and re-evaluate once day trading was done with them.

With a billion dollars to invest and over 1100 movies in my list, portfolio management became an issue.  How to track which ones were from 1 of 4 strategies I am currently playing is a challenge.  I decided that I would allocate the share value of 99997 to those that were Fund Mirroring stocks. (99999=day trading/news, 99998=penny stocks and $0-2 long term holds, 99996=bleeders, and $2+ long term holds)

Not every stock makes money.  No investor is infallible, especially in the short term.  I sold off any losers after a couple of days.

As the funds make money, they can invest in more projects.  I found it to be a good idea to re-visit the fund and renew my holdings once/week or so (that is to say, every now and again)

Funds grow slowly.  The stocks are definitely all long term holds designed to profit in the long term.  Market fluctuations occur but can mostly be ignored after a while (once a profit buffer has been established)

Not all funds are created equal.  Some managers have a net gain, but balanced against loss.  While the 2 I chose have a 90%ish green to 10%ish red ratio, others are 60/40 or less. 

Conclusion

These guys rock!  I was amazed at how consistently their holdings made ME money despite my lack of understanding of a project.  Everyone has red in their port, but I was very surprised at how many stocks 90%+ that these 2 fund managers carried were consistently green in my port.  While I did sell of stocks, it was not as often as say, the slow bleeder strategy.  Ultimately what I learned was that they have already made a determination as to what position they should hold, and more often than not, were correct.

This is a medium to large portfolio size strategy.  There is sufficient movement on weekly releases and starbonds to eat up all the investment capability of small to medium sized ports.  Medium+ to large sized ports can sustain a long term holding strategy (and probably do already).  The trick is to find Fund Managers who consistently does very well compared to the rest.

Results

Current holdings 40 stocks, average $/share=5.51

22.03 Mil invested, 5.06 Mil gained

+22.98% return on investment

For your consideration.  Choose your managers wisely.  Rocket.