With the 2014 World Cup nearing its conclusion, I thought it might be a good time to revisit the Global Sports Portfolio, a mock portfolio of 16 sports stocks I created almost two years ago to the day. May the best stock win.
The most important question to answer is how these sports stocks performed over the past two years. For comparative purposes, the SPDR S&P 500 (SPY) and Vanguard FTSE All-World ex-US ETF (VEU) achieved cumulative total returns of 51% and 39% respectively through June 30. Any self-respecting stock picker would aim to outperform the indices, so the target here is 49% — five percentage points higher than the average of the SPY and VEU combined.
How’d we do?
Pretty good, actually. Out of 16 stocks, only three were in negative territory, nine beat the SPY, and a whopping 11 outdistanced VEU. Together, the 16 sports stocks achieved a cumulative total return of 53.3%, almost 10 percentage points higher than the indices. Even using the better-performing SPY as the benchmark — which wouldn’t happen in the real world because 50% of the sports stocks are international in nature and would be benchmarked as such — would have left a 270 basis point victory.
I’ve studied sports stocks for many years, and I’m always amazed that no one has created an ETF or mutual fund to track their performance.
First, a quick rundown of the portfolio I created:
Now let’s take a closer look at the biggest winners and losers over the past two years.