My Best (and WORST) Investment Calls So Far in 2012

Apple, Priceline prove me out, but Sears smacked me

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My Best (and WORST) Investment Calls So Far in 2012

A month or two ago, I penned an article with the headline, “Forget Uncertainty: TRUST Is the Big Issue for Investors.”  I believe wholeheartedly in the notion that the market should be accessible and reasonable fair (excluding obvious advantages of means and skill) for everyone.

As such, I think it’s only honest to share regular updates on my personal track record with readers. While the majority of my writing is more journalistic in nature, focused on the trends creating opportunities and risks in a broad sense, I do like to weigh in regularly with clear “actionable” advice.

And while I’ve made some profitable calls, I’ve also made some stinkers.

Without an exhaustive track record for proof, my informal take is that I’m better than breakeven but hardly outperform the market. That doesn’t surprise me, as underperformance is par for the course among active fund managers. So readers should remember the Jack Bogle philosophy of just buying the market with low cost and low stress via an indexed fund.

Of course, if you’re reading this, it’s probably because you have an “itch” for investing and yearn for ideas that will help you beat the market. Me too — and we’ll get to some of the best picks I’ve made this year that I hope your shared in. But first, let’s cover my worst calls that I sincerely hope you thought better of …

Worst Calls So Far in 2012

WORST BY FAR — Over 100% Loss in Sears Screw-Up

In January, I panned Sears (NASDAQ:SHLD) as a possible short candidate. Well, that was quite a crowded trade — and the resulting short squeeze caused the stock to more than double by March.

For anyone familiar with short-trading, this is an epic fail. Because while your losses going long are limited to 100% as a stock goes to zero, your downside on a short can be infinite if a stock keeps going up. Thus, I literally could not have been more wrong had I picked a stock that went bankrupt.

TRIPLE FAIL — Buying a Top in Blue Chips

I thought I would be clever in the run-up to March Madness and highlight some “triple threat” blue chips. The factors I looked at were dividends/cash, share performance and growth potential. Sounds good, right?

Well, the screen identified Intel (NASDAQ:INTC), Caterpillar (NYSE:CAT) and McDonald’s (NYSE:MCD) as the “best” buys. But while the S&P is up almost 3% since publication, all of these picks are dramatically in the red. The worst, CAT, is down almost 27%.

ALMOST AS BAD — Run Screaming From My “Screaming Buys”

Also in January, I picked three cheap stocks under $10 that were “screaming buys.” Instead, I hope you ran screaming from the picks, which included Wendy’s (NASDAQ:WEN) and SandRidge Energy (NYSE:SD).

I was hoping for a turnaround in Wendy’s to gain momentum, as well as some firming up in energy prices. Wrong on both counts, and both stocks have fallen around 20% as the S&P 500 picked up about 8% since publication.

My third pick, LSI Corp. (NYSE:LSI) tracked the market … not as bad as the triple-threat flops, at least.

SHAMEFUL PANDERING — Gas Goof

In February, I bought into the hype about increasing demand and rising commodity costs, penning one of those shamefully clicky articles about $5 gas. Anyone who has filled up their car in the last few months should know how wrong this call has been.

But hey, aren’t you glad I was so wrong?

Next up, the best calls.


Article printed from InvestorPlace Media, http://investorplace.com/2012/08/my-best-and-worst-investment-calls-so-far-in-2012/.

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