Bounceback portfolio 2017

The Bounceback Portfolio invests in the 10 worst performing FTSE 350 stocks of the previous year and holds them for the 3-month period, January-March. 

Let’s see how the Bounceback Portfolio fared in 2017.

Performance in 2017

The following table lists the ten worst performing FTSE 350 stocks in 2016. These ten stocks form the 2017 Bounceback Portfolio.

The final column in the table also gives the returns for each stock for the period Jan-Mar 2017. For example, Capita shares fell 56.0% in 2016, and then rose (bounced back) 6.3% in the first three months of 2017.

Company TIDM 2016 2017 (Jan-Mar)
Capita -56.0 6.3
Restaurant Group (The) -52.7 2.8
Sports Direct International -51.7 10.6
Essentra -44.3 13.9
easyJet -42.2 2.1
International Personal Finance -40.4 -5.0
IG Group Holdings -38.4 0.6
McCarthy & Stone -36.6 17.4
Inmarsat -33.9 13.2
Man Group -32.6 24.5
FTSE 350 12.5 2.9

For reference, the performance of the FTSE 350 Index is also shown for the same periods.

As can be seen, the majority of the bounceback stocks outperformed the Index in the first quarter of 2017.

The performance of the 10 Bounceback Portfolio stocks for Jan-Mar 2017 is shown in the following chart.

Bounceback portfolio 2017 Returns Jan-Mar 2017

On average the Bounceback Portfolio stocks had a 3-month return of 8.6%, compared with a FTSE 350 Index return of 2.9% for the same period.

So, an equally-weighted portfolio of the ten bounceback stocks would have outperformed the FTSE 350 Index by 5.7 percentage points over the target first three months of 2017.

Bounceback portfolio performance 2003-2017

The Bounceback strategy has been tracked since 2003. The following chart shows the comparative performance of the portfolio and the FTSE 350 Index for each year since 2003.

Bounceback portfolio v FTSE 350 - Jan-Mar returns [2003-2017]

Since 2003, the Bounceback Portfolio has under-performed the index only twice (in 2013 and 2015).

The following chart shows the cumulative performance of the portfolio from 2003.

Bounceback portfolio cumulative performance - Bounceback portfolio v FTSE 350  [2003-2017]

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Bounceback Portfolio 2017

The Bounceback Portfolio invests in the 10 worst performing FTSE 350 stocks of the previous year and holds them for the 3-month period, January-March. 

The Bounceback Portfolio for 2016 recorded the best performance ever for the strategy: a 3-month return of 38.5%, compared with a FTSE 350 Index return of -1.4% for the same period.

The following table lists the ten worst performing FTSE 350 stocks in 2016. These are the ten stocks that will comprise the 2017 Bounceback Portfolio.

Company TIDM Return in 2016 Return since 31/12/2016
Capita CPI -56.0 -2.4
Restaurant Group (The) RTN -52.7 6.0
Sports Direct International SPD -51.7 2.3
Essentra ESNT -44.3 -1.3
easyJet EZJ -42.2 7.4
International Personal Finance IPF -40.4 -4.4
IG Group Holdings IGG -38.4 7.1
McCarthy & Stone MCS -36.6 4.8
Inmarsat ISAT -33.9 2.1
Man Group EMG -32.6 2.4

The final column gives the returns for the individual stocks for the first six days of the 2017. The portfolio as a whole has seen a return of 2.4% for the first six days of 2017, against a return of 1.9% for the FTSE 350 Index.

The Bounceback Portfolio is meant to be held until the end of the March 2017, but it is good to see that it has started the year well so far.


 

More articles on the Bounceback Portfolio.

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Shares that like/dislike October

Shares that like October

The following table lists the five FTSE 350 shares that have the best returns in October over the last ten years. For example, Diageo has an average return of 3.6% for the month of October. Each stock has risen in at least eight of the past ten years in October – Diageo is the only stock in the FTSE 350 whose shares have risen every October in the past ten years.

Company TIDM Avg(%)
Diageo 3.6
Restaurant Group (The) 3.3
easyJet 11.6
Brewin Dolphin Holdings 6.4
Tate & Lyle 4.8

Shares that dislike October

The following table lists the three FTSE 350 shares that have the worst returns in October over the last ten years. For example, Grainger has an average return of -8.3% for the month of October. All three stocks have fallen in eight of the past ten years in October.

Company TIDM Avg(%)
Grainger -8.3
Dialight -3.0
Worldwide Healthcare Trust -1.8

An equally-weighted portfolio of the above strong October stocks would have out-performed an equally-weighted portfolio of the above weak October stocks by an average of 10.3 percentage points in October for the past ten years.

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FTSE 350 share performance in 1H 2013

The following table shows the top ten performing shares in the FTSE 350 Index for the first six months of 2013.

Company TIDM Chng 1H 2013(%)
Ocado Group 244.3
Thomas Cook Group 210.7
Xaar 180.3
easyJet 69.3
Bank of Georgia Holdings 62.1
CSR 61.5
3i Group 55.4
Ted Baker 53.0
Ashtead Group 51.4
Barratt Developments 49.1

And the following table shows the worst ten performing shares in the FTSE 350 Index for the first six months of 2013.

Company TIDM Chng 1H 2013(%)
African Barrick Gold Ltd -78.2
Hochschild Mining -68.0
Kazakhmys -66.7
Evraz -62.7
Polymetal International -61.4
Fresnillo -52.2
Ferrexpo -47.0
FirstGroup -43.5
Antofagasta -40.0
Anglo American -33.2

 

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Travel & Leisure sector monthly seasonality analysis

The 2013 edition of the Almanac looks at the historic monthly performance of the FTSE 350 sectors. Here we look at the Travel & Leisure sector.

The following chart plots the average out-performance of the FTSE 350 Travel & Leisure sector over the FTSE 100 Index by month since 1999. For example, since 1999 on average the sector has out-performed the FTSE 100 Index by 2.1 percentage points in November.

Observations:

  1. The strongest months have been November and December – the sector has under-performed the market only three times in November in the last 14 years.
  2. The sector has no consistently weak months; although the sector has under-performed the market by an average of 2.6 percentage points in October, the sector has actually out-performed the market that month in eight of the past 14 years.

The 23 stocks in the FTSE 350 Travel & Leisure sector [NMX5750] are-

Betfair Group [BET] Ladbrokes [LAD]
Bwin.Party Digital Entertainment [BPTY] Marston’s [MARS]
Carnival [CCL] Millennium & Copthorne Hotels [MLC]
Compass Group [CPG] Mitchells & Butlers [MAB]
Domino’s Pizza UK & IRL [DOM] National Express Group [NEX]
easyJet [EZJ] Playtech Ltd [PTEC]
Enterprise Inns [ETI] Rank Group (The) [RNK]
FirstGroup [FGP] Restaurant Group (The) [RTN]
Go-Ahead Group (The) [GOG] Stagecoach Group [SGC]
Greene King [GNK] TUI Travel [TT.]
InterContinental Hotels Group [IHG] Wetherspoon (J D) [JDW]
International Consolidated Airlines Group SA [IAG]
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