Thursday, 22 September 2011

Portfolio Metrics for The Cheap Stocks 26 Net/Net Index

Thanks for all of the e-mails that we've received regarding the new index. Some have questioned the inclusion of certain companies in the Index, based on one issue or another. The truth is, net/nets often have fleas. Perhaps there are corporate governance issues, the operating business is broken, or there is simply great skepticism as to whether a company is a going concern. Sometimes the companies are simply too small to generate any interest, and a decent name may have fallen through the cracks. Make no mistake, we fully expect that there will be bankruptcies by the time the our two year time frame has passed. There will probably be companies that will be acquired; and a few whose stock price will skyrocket relative to their current price. We experienced all of the above with the CS 21 Net/Net Index; this is simply another experiment in Net/Net Indexing.
Cheap Stocks 26 Net/Net Index Portfolio Metrics at inception (9/13/2011)
Total Market Cap:$6.297 billion
Average Market Cap:$242 million
Total Cash and ST Investments:$3.944 billion
Price to Book Ratio:.63
Price to Net Current Assets Value (NCAV):.84
*The author has a position in Ingram Micro(IM). This is neither a recommendation to buy or sell any securities. All information provided believed to be reliable and presented for information purposes only

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