It’s bad form to gloat. Apart from making you insufferable to be around at parties, you’re tempting fate … and inviting a reversal of fortune.
That said, I’m going to risk it and toot my own horn here for a moment. I’ve had a good string of successes in InvestorPlace’s annual Best Stocks contest. I took the top prize in 2011, the very first year of the contest, when my pick — credit card behemoth Visa Inc (NYSE:V) — racked up a 34% return.
I followed that up in 2012 with a strong performance by Turkish mobile operator Turkcell Iletisim Hizmetleri A.S. (ADR) (NYSE:TKC), just barely missing the top slot with a 37% return. And I reclaimed my crown in 2013 when German luxury automaker Daimler AG (OTCMKTS:DDAIF) rolled to victory with a 65% return.
Alas, you can’t win them all. My 2014 pick, South African mobile operator MTN Group Ltd (ADR) (OTCMKTS:MTNOY) finished in last place, losing 6%. And my 2015 pick, business development company Prospect Capital Corporation (NASDAQ:PSEC) finished in the middle of the pack, losing a modest 4%.
Well, in 2016, I got my groove back, winning InvestorPlace’s Best Stock for 2016 contest with a 55% return in Energy Transfer Equity LP (NYSE:ETE). Over the six years of the contest, my picks have returned an average of 30%. Not too shabby. Taking the top spot in 3 out of 6 years and coming in a close second in a fourth… I’ll take that!
I’m the first to admit that there is a lot of luck involved with winning a contest like this. Holding a single stock for exactly one calendar year is not how investors invest in the real world. And had the contests started on some other arbitrary date — say, Jan. 31 as opposed to Dec. 31 — then the returns across the board would look a lot different. So luck was definitely on my side with respect to the exact timing.
Yet all of my picks did have one thing in common: All were contrarian plays that no one else wanted at the time.
Let’s take Energy Transfer Equity as an example. Right now, shares are riding high on optimism that the incoming Donald Trump administration will be friendlier to pipeline operators. The Barack Obama administration has been openly hostile, with their halting of ETE’s Dakota Access Pipeline being a prime example. The change in the White House has investors looking at this entire sector in a more positive light.