Value Microcaps Pick Six Lotto 11

[researcher59]

My remarks for the VMC Champions Board -

PSL11 spanned a very interesting and volatile period for the stock market ! As measured by the S&P500, the market dropped an unremarkable 3% for the 15 week contest period. However during the first 8 weeks of the contest the market dropped 25% followed by a rebound of 30% in the final 7 weeks. In effect we experienced a bear market for the 1st half of the contest followed by a bull market in the 2nd half. A truly unique and historic period !

I was greatly focused on my own portfolio during the market crash and so during the first 10 weeks of the contest did not make any trades (being very distracted by my own rapidly declining net worth) ! As the market began a strong rebound in early March I found myself in the middle of the pack in 40th place. On March 20th, 10 weeks into the 15 week contest, I was in 30th place with a loss of 8%. I still had my 4 trades left and set out to improve my position, with the goal of perhaps making it into the top 10. Victory was hardly on my mind with Yielddude leading with a gain of 37%.

On March 25th I began my comeback bid by freezing DIT for a 50% gain and soon thereafter doubled down into KPPC. My key trade came next, a risky earnings play on ERSO, a former IBD #1 stock now on the pinksheets. Q4 prospects were grim with aluminum prices having fallen sharply but I was encouraged by their dividend declaration as well as comments about hedging in their SEC filings. Even a breakeven quarter might spark a rally in the stock given its very depressed price of $0.57. My risky trade paid off nicely when they posted a surprisingly decent quarter with EPS of $0.06. The stock quickly rallied to near $1 for a 74% gain. My next trade was more conservative, into MFI, a financial microcap that hadn’t participated in the rally of the financials and seemed overdue for an upside move. That led to a gain of 29% over a 2 week period. Another winner for me was ORS which rallied strongly when a newsletter recommended it. I opportunistically froze the stock to lock in a 49% gain and subsequently traded into AEY for a further small gain.

Without any trading my original pick 6 would have appreciated 17% for the contest compared to a loss of 3% for the S&P500. It would have been a respectable showing but still only a 19th place finish. Trading is one of the keys to strong results and allowed me to surge up the rankings in the final weeks and finish with a gain of 62%.

The VMC board is by far the finest I have ever come across on the internet and has significantly contributed to my success in recent years. The expertise and due diligence of so many of our contributors is unrivaled in my experience. I look forward to continued successful investing and trading together in the years ahead. I wish our entire group success. For some more information on my investment style along with a bit of personal background I refer you to my PSL8 champion’s commentary -

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