In Treatment

I have to say, I enjoyed watching HBO's series "In Treatment". The show is a bit unusual as all the action takes place in a psychiatrist's room. There are five sets of episodes; each following different patient. We watched the first season via Netflix.

Penguin-S&P500 Spreads (12 Months)

Since August 2007, monthly Penguin search results are published on the last day of each month. Each search produces four stocks. Each portfolio of four stocks is tracked down over the next twelve months and results are stacked up against the S&P500. My goal is to be on average 10% ahead of the S&P500. So far, I am 17.3% ahead of the main index. On the graph below you can see how individual searches performed relative to the main market index over the course of one year. Each bar represents a spread between Penguin monthly search portfolio and the S&P500 over the twelve month period. Not bad for a fully automated buy&hold system, huh?
Only members have full access to my monthly search algorithms.

The Greatest Good

"The greatest good you can do for another is not just share your riches but to reveal to him his own." ~ Benjamin Disraeli

Yields On 30 Dow Jones Components

By looking at high yielding Dow stocks, I am reminded that biggest risk in long-term investing in stocks is not being invested in them. I think if your time horizon is more than 5 years, it is hard to justify passing on these kind of yields:

AT&T Corp. 6.60%
DuPont 6.40%
Verizon 5.99%
Merck 5.44%
Caterpillar 5.08%
Kraft Foods 4.58%
Pfizer 4.27%
Boeing 3.95%
Chevron Corp 3.92%
Home Depot 3.81%
McDonald's 3.48%
Johnson & Johnson 3.45%
Procter & Gamble 3.44%
Coca-Cola 3.42%
General Electric 3.41%
3M 3.39%
Intel 3.38%
American Express 3.10%
United Tech 2.96%
Travelers Cos. 2.92%
Exxon-Mobil 2.40%
Wal-Mart Stores 2.25%
Microsoft 2.19%
IBM 2.11%
Walt Disney 1.50%
Alcoa 1.16%
Hewlett-Packard 0.83%
J.P. Morgan Chase 0.59%
Bank of America Corp 0.30%
Cisco 0.0%

Passive Income - June '09

Four passive income streams produced $314.57 in June. This result represents 21% increase from May ($259.97). When it comes to passive income, this was our second best month in 2009.

Dividends: $283.37
Interest: $27.01
Book royalties: $0.00
Site income: $4.19

Broken by months:
January: $346.01
February: $258.49
March: $269.25
April: $262.33
May: $259.97
June: $314.57

Broken by streams:
Dividends: $1,260.51
Interest: $206.40
Book royalties: $193.41
Site income: $50.30

YTD: $1710.62

Penguin Index 3

Home Sweet Home

We are back home from our three week vacation. I noticed how visiting other places makes us appreciate more USA. Some things that we take for granted here are non-existent in other countries. It is nice to be back. Although I am very tired from our trip, I do feel recharged and with fresh perspective.

Monthly Performance

On average, my Penguin Index picks beat S&P500 by 1.5% per month! They managed to beat the main index in every single month.

Monthly Picks Outperforming S&P500

Penguin Index monthly picks beat the S&P500 in every single month during the first year since inception. The graph below shows percentages of my monthly picks which beat the main index in individual months. First and tenth month are clear lagers, while fourth, seventh, eighth and twelfth months have more than 70% outperformers. On average, two out of three picks beat the S&P500 in any given month during the first year.

Penguin Index - One Year Mark

Control

"You cannot control what happens to you, but you can control your attitude toward what happens to you, and in that, you will be mastering change rather than allowing it to master you." ~ Brian Tracy

Performance Check

Capitalism & Debt

"Capitalism does not exist without capital, and debt is not, has never been and will never be a form of capital." ~ Ron Paul

Performance Check

Wealth

"The most expensive piece of real estate is the six inches between your right and left ear. It’s what you create in that area that determines your wealth. We are only really limited by our mind." ~ Dolph de Roos

Penguin Index vs. S&P500 (Table)

Two out of three monthly searches outperform the S&P500 on a monthly basis. Average outperformance is 1.6% per month.

Waiting

"If you can't find any companies that you think are attractive, put your money in the bank until you discover some." ~ Peter Lynch

Penguin Index 3

Life & Money

"Truth is, money doesn’t make you happy or a nice person, it just means you have the means to live the life you want. What kind of life is up to you, and that’s where some people crash and burn. They get money but they don’t have a clue about being a good person so they just make themselves and everyone around them miserable." ~ Phil Town

Penguin Index 4

Obstacle

"Lack of money is no obstacle. Lack of an idea is an obstacle." ~ Ken Hakuta

Monthly Spread: Penguin Index 3/S&P500

Since Penguin Index 3 inception (9/1/07), the spread between my index and the S&P500 is +22.3%.

Self Improvement

"What you get by achieving your goals is not as important as what you become by achieving your goals." ~ Johann Wolfgang von Goethe

Monthly Spread: Penguin Index 5/S&P500

Since Penguin Index 5 inception (9/1/07), the spread between my index and the S&P500 is +21.0%.

Correlation

"Often, there is no correlation between the success of a company's operations and the success of its stock over a few months or even a few years. In the long term, there is a 100 percent correlation between the success of the company and the success of its stock. This disparity is the key to making money; it pays to be patient, and to own successful companies." ~ Peter Lynch

Penguin Index - One Year Mark