Saturday, April 10, 2010

[ConservativeOptionStrategies] Long-Term CC System update

 

I did some research (sanity check) this morning on the very best long-term systems - including the #1 investment strategy as tracked by AAII (CANSLIM).

IBD 100 index (since 05-May-2003): +127.1%
versus S&P 500: +28%
Note: it had a 58.3% drawdown with the '08-'09 dump.

"According to the American Association of Individual Investors (AAII), since January 1998, market portfolios traded according to CANSLIM principles gained an average of 1,859.3%, versus a gain of 23% in the S&P 500. . ." http://en.wikipedia.org/wiki/CAN_SLIM
Meanwhile, my CC Strategy since 1998 has gained 3500%.

Compare the results from professional money management company:

CANSLIM PC (Jan-2001-Feb-2010): 215%
versus S&P 500: -4.6%
Note: it had just a 20% drawdown.

This last investment program most closely resembles my CC Fund approach, since it's "portfolio is a long-term growth vehicle that invests in leading growth stocks as the market rises and scales to cash to preserve gains during market declines."North Coast

Compare Returns

            -CANSLIM PC-  -KC PRO CC Fund-  -S&P 500-
2001            12.5%                        16%                (11.9%)  
2002              2.7%                          1%                (22.1%)
2003            55.5%                      120%                  28.7%
2004            31.5%                        44%                  10.9%
2005            13.8%                        76%                    4.8%
2006            10.1%                        34%                  15.5%
2007            12.5%                        12%                    4.9%
2008           (12.3%)                      28%                    (37%)
2009            10.0%                        (6%)                 23.5%
2010             (1.8%)                    (1.5%)                     8%

In conclusion, the above data re-affirms my long-term investment methods remain on point - despite lackluster trailing 9-month results.
A) Risk: my 20% (max) drawdown is in keeping with CANSLIM PC
B) Return: my 1,062% gain bests PC's 215%.
C) Although both systems returns vary substantially from one year to the next, staying the course grows your account exponentially - despite the market's ups and downs.
D) Since Jan-2008 (through the market crash and return from the abyss) my system has significantly out-performed growing 18.5% versus CANSLIM PC's loss of 1.8%.
E) Drawdown: my DD during this period has been significantly muted compared to the drop and rise from PC, which is still off it's highs.
F) 2010: Even though Q1 has seen a supposed market "correction" AND has a YTD 8% gain - both these systems have under-performed.
G) Long-Term Systems: for the long-haul, this approach are still the most profitable for the individual investor.

I'll leave you with a quote from the publisher of IBD who developed the CANSLIM method - the #1 investing strategy, as independently tracked by AAII.

"90% of people in the stock market, professionals and amateurs alike, simply have not done enough homework." William J. O'Neil

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