{"id":1778,"date":"2020-02-20T07:11:56","date_gmt":"2020-02-20T07:11:56","guid":{"rendered":"https:\/\/straussresearch.com\/?p=1778"},"modified":"2020-02-20T07:25:50","modified_gmt":"2020-02-20T07:25:50","slug":"model-portfolio-mid-february-2020","status":"publish","type":"post","link":"https:\/\/straussresearch.com\/index.php\/2020\/02\/20\/model-portfolio-mid-february-2020\/","title":{"rendered":"Model Portfolio:  Mid-February 2020"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"1778\" class=\"elementor elementor-1778\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-84a264f elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"84a264f\" data-element_type=\"section\" data-e-type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-7247ca9\" data-id=\"7247ca9\" data-element_type=\"column\" data-e-type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-96b278c elementor-widget elementor-widget-text-editor\" data-id=\"96b278c\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p>Based on a review of data for sectors, industry groups and stocks, we are constructing a model portfolio which provides more detail beyond the list shown in the blog post entitled \u201cCurrent Stock Picks 1-28-20.\u201d\u00a0<\/p><p>First, the goal of the portfolio is to outperform the S&amp;P 500, so it is important to note that the largest few stocks in the S&amp;P 500 account for almost 20% of the index.\u00a0 This list of trillion dollar capitalization stocks includes:<\/p><p><span style=\"text-decoration: underline;\">Stock\u00a0<\/span>\u00a0\u00a0 \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <span style=\"text-decoration: underline;\">Weight<\/span><\/p><p>AAPL\u00a0 \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 4.7%<\/p><p>MSFT\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 4.7%<\/p><p>AMZN\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a03.7%<\/p><p>GOOGL (Class A)\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 3.4%<\/p><p>GOOG\u00a0 (Class C)\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a02.4%<\/p><p>First, simply because of the sheer size of these companies and their importance in the S&amp;P 500 index, we are including them in the portfolio in equal proportion to their weight in the index.\u00a0 This will neutralize the risk of underperforming the index based on the behavior of these giant stocks.<\/p><p>Second, we are moving to an equal weight in some of the smaller sectors that have recently come to life, namely real estate and utilities.<\/p><p>In addition we are moving to an equal weight in energy, not because it is acting well, but because it is so oversold that any move up from the bottom could cause a relatively large percentage gain (similar to a stock that has dropped from $50 to $10, then rises to $15, creating a 50% gain from its lows).<\/p><p>Similarly we are moving to a roughly equal weight in the consumer staples sector, because the overall market has been rising for almost five months, and therefore is overbought and overdue for a pullback.\u00a0 If a pullback occurs, the consumer staples sector, as a \u201csafe haven\u201d is likely to outperform.\u00a0 To neutralize this risk we are including the consumer staples ETF (ticker symbol XLP) in the portfolio.<\/p><p>The remainder of the portfolio is constructed with a variety of individual stocks, chosen because they have the following characteristics:<u>\u00a0 <\/u><\/p><p><u>Fundamentals<\/u>:\u00a0 Bullish ratings from a proven quantitative stock selection model, based on fundamental factors such as earnings growth and earnings estimate revisions.<\/p><p><u>Technical positions<\/u>:\u00a0 Good chart patterns based on the proven principles developed by <em>Investor\u2019s Business Daily<\/em>.\u00a0 This means these stocks have characteristics such as good money flow, good relative strength, a recent breakout to a new high after a consolidation period, are finding support at the 50-day moving average, etc. \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/p><p><u>Industry Groups<\/u>:\u00a0 \u00a0Many of these stocks are in selected industry groups, chosen because most stocks in the group show bullish characteristics.<\/p><p>By holding 40 stocks (actually more than 40, because some are ETFs), the portfolio mitigates the risk of being overly influenced by any single stock with poor performance.<\/p><p>However <u>the portfolio is very overweighted in selected industry groups<\/u> that are strong both fundamentally and technically, including the following:\u00a0<\/p><p>Residential Construction<\/p><p>Information Technology Services<\/p><p>Semiconductor Equipment<\/p><p>Software \u2013 Application<\/p><p>As far as broad market sectors are concerned, the portfolio is overweighted in the technology sector, while roughly equal weighted or slightly underweighted in all the other broad sectors.<\/p><p>We will continue to monitor this portfolio and make changes as market developments unfold.<\/p><p>The following spreadsheet shows the composition of this portfolio.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-cb3a49c elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"cb3a49c\" data-element_type=\"section\" data-e-type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-72c513b\" data-id=\"72c513b\" data-element_type=\"column\" data-e-type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-310d7b1 elementor-widget elementor-widget-image\" data-id=\"310d7b1\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"image.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img fetchpriority=\"high\" decoding=\"async\" width=\"952\" height=\"580\" src=\"https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-1.jpg?fit=952%2C580&amp;ssl=1\" class=\"attachment-large size-large wp-image-1782\" alt=\"\" srcset=\"https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-1.jpg?w=952&amp;ssl=1 952w, https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-1.jpg?resize=300%2C183&amp;ssl=1 300w, https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-1.jpg?resize=768%2C468&amp;ssl=1 768w\" sizes=\"(max-width: 952px) 100vw, 952px\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-4c27604 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"4c27604\" data-element_type=\"section\" data-e-type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-78d3818\" data-id=\"78d3818\" data-element_type=\"column\" data-e-type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-a8b0173 elementor-widget elementor-widget-image\" data-id=\"a8b0173\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"image.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img decoding=\"async\" width=\"954\" height=\"561\" src=\"https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-2.jpg?fit=954%2C561&amp;ssl=1\" class=\"attachment-large size-large wp-image-1784\" alt=\"\" srcset=\"https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-2.jpg?w=954&amp;ssl=1 954w, https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-2.jpg?resize=300%2C176&amp;ssl=1 300w, https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-2.jpg?resize=768%2C452&amp;ssl=1 768w\" sizes=\"(max-width: 954px) 100vw, 954px\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-82989dc elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"82989dc\" data-element_type=\"section\" data-e-type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-145080c\" data-id=\"145080c\" data-element_type=\"column\" data-e-type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-ab250a7 elementor-widget elementor-widget-image\" data-id=\"ab250a7\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"image.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img decoding=\"async\" width=\"955\" height=\"559\" src=\"https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-3.jpg?fit=955%2C559&amp;ssl=1\" class=\"attachment-large size-large wp-image-1785\" alt=\"\" srcset=\"https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-3.jpg?w=955&amp;ssl=1 955w, https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-3.jpg?resize=300%2C176&amp;ssl=1 300w, https:\/\/i0.wp.com\/straussresearch.com\/wp-content\/uploads\/2020\/02\/Model-021920-Part-3.jpg?resize=768%2C450&amp;ssl=1 768w\" sizes=\"(max-width: 955px) 100vw, 955px\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Based on a review of data for sectors, industry groups and stocks, we are constructing a model portfolio which provides more detail beyond the list shown in the blog post entitled \u201cCurrent Stock Picks 1-28-20.\u201d\u00a0 First, the goal of the portfolio is to outperform the S&amp;P 500, so it is important to note that the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"site-sidebar-layout":"default","site-content-layout":"default","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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