Stock Gumshoe Update — Winners and Losers

By Travis Johnson, Stock Gumshoe, February 13, 2008

I have finally gotten around to editing the spreadsheet to add some consistency, and to update with all the teaser stocks I’ve written about through the end of January.

The bad news? If you have invested in each one of those stocks on the day the email first came out (there are a few hundred of them, so not so likely), you would have had an average loss of about 10%.

The good news? There have been some spectacular picks as I get close to the one-year anniversary of publishing this information, and I have enough data about some of these newsletters that it might be possible for those of you who like to play with spreadsheets to make some generalizations about the teaser stocks from particular newsletters.

The link to the tracking sheet, both the web version and the Excel download, is in the sidebar about halfway down, so you can check it out for yourself if you like. The prices are live with a 20 minute delay, but it’s always possible that I’ve missed a stock split or something like that for some of these, so let me know if you notice any anomalies.

To let you know the big winners and losers so far, Ann Sosnowski remains atop the rankings for teaser stocks with her pick of Lynas, one of the very early Gumshoe writeups. That’s a 200% gain as of the last pink sheet clearing price.

And that should shock us all, frankly: The VERY BEST of all of the teased stocks I’ve covered here, more than 200 stocks, has a 200% return.

How many teasers have you seen in the past year that promised returns of several thousand percent, “in a matter of months”?

So just a word to the wise — 200% or a little bit better is the very best performance that any stock that has ever graced this spreadsheet has had, even in a short term pop. Not a single one has ever hit a 300% return (yet).

Other winners? As might be expected, there are several Robert Hsu picks in the top couple dozen stocks — but they’re not his China Strategy picks, the direct China plays, they’re Asia Edge picks, the ones that use a “Greater China” strategy that are supposed to benefit from the growth in China but are not necessarily Chinese themselves. The best two performers there have been Mosaic, the fertilizer company, and VimpelCom, the Russian cellular provider.

Many of the newsletters are quite volatile in their teaser picks — Bottarelli Research Small Cap, for example, has teased two great performers (World Water and Solar and China Unicom) and two unbelievably bad stinkers (Big Cat Energy and Dendreon).

The worst overall performer? Ian Cooper’s Early Alert Trader did poorly, thanks to just two stocks that are both unsuccessful gambling plays. Another one that has gotten light coverage from the Gumshoe has been Emerging Capital Report, which has teased a few pretty obscure companies — all of whom are down by at least 60%.

Breakaway Investor, from Andrew Mickey, is the one that we’ve covered the most that has probably done the most poorly, just from a scan of the list. From seven picks of his that I’ve written about, only one is in positive territory.

Not many folks stand out on the positive side — not surprising, since about 2/3 of the Gumshoe tracked picks are in negative territory. Motley Fool Global Gains actually has most of their picks in the green still, which is saying something, and Robert Hsu’s China Strategy has overall done fairly well, too, though with some big losers.

This is, of course, not to make any assessments on the quality of these newsletters overall. These are just the stocks they’ve teased us with in their ads. One might assume that these are their favorite picks, and that they’re putting their reputations on the line by recommending them so heavily in their advertising, but it’s just as likely that they’re the stocks that just have exciting stories that lend themselves to marketing. And of course, this assumes that as an emotional investor you bought the shares the day you got the teaser email, and then held them forever (since I’ve no way of reliably knowing if or when these stocks might have been sold).

Feel free to peruse the list, do your spreadsheet tinkering, and let us know what your impressions are. I’m hoping to upgrade the tracking in the next few months to include relative performance versus the S&P, just for our information (since the average performance of -10% or so is probably fairly close to the S&P’s performance over that time). I’d also like to get some more computational data in here to track highs and lows following the recommendations, and to hopefully help prove the point that even if you want to buy one of these companies — many of which are great investments — there’s no reason not to wait a bit for a better price. Unfortunately, my system is not able to handle that quite yet.

Full disclosure: The stocks on the list that I currently own are Lynas, Markel, Berkshire Hathaway, SeaDrill, Accuray, Ambrian, Winthrop Realty Trust, Centamin Egypt, Novartis, HDFC Bank, and MEMC Electronic Materials. I also own call options on Loews, Accuray, Pacific Ethanol, Morgan Stanley, ABB, and Seaspan Worldwide. This is not a recommendation of any of those investments.


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20 Comments on "Stock Gumshoe Update — Winners and Losers"

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Woman with Portfolio
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February 13, 2008 9:32 pm

Gumshoe, though you don’t put it this way, you’re always pointing out the emperor with no clothes — the touts with no gains. Bless you for it.

Frankie1ny
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Frankie1ny
February 14, 2008 10:12 am

Gumshoe, I am a long time reader but rarely make submit any comments, however I felt complelled to show my appreciation here. You are providing a wonderful service to your readers. No doubt you have proven over and over again the old adage about how much “free advice” is actually worth! Keep up the good work. Many thanks

Charles Walter
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Charles Walter
February 14, 2008 10:23 am

Frankie1ny dosn’t quite have it correct. None of these teasers are free..

Elissa Stein
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Elissa Stein
February 14, 2008 11:08 am

Gumshoe–You are the greatest. Whenever I get one of those teasers, my palms get sweaty, I wonder what am I missing, and I do my own research to find the stock (that’s how I stumbled on your website). The only stock I ever bought on a teaser is ABB–through Mark Skousen’s teaser ad, after having seen it on several other “buy” lists. So, I love what you are doing. Your website and insights have kept my palms dry! Congrats on your first year and the improvements you have made to the website. It really is great.

Greg Raymond
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Greg Raymond
February 14, 2008 11:15 am

I really enjoy these emails. What fun! Keep up the good work.

nvestgrrl
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nvestgrrl
February 14, 2008 11:22 am

Gumshoe — I love what you do, but think it’s important to point out that your judgment on the quality of these newsletter recommendations assumes a buy and hold strategy, which few advocate. As a random example, Mark Skousen’s recommendation of ACH gained 70% in three months before falling. And the product is “Hedge Fund Trader.” Of course, you can’t know when stocks were sold, or whether related options recommendations scored big. But readers — let’s not assume the stocks teased all led to large subscriber losses just because the stocks fell.

Thanks for sharing!

Pete Ewing
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Pete Ewing
February 14, 2008 12:28 pm

Gumshoe – Perhaps noting the maximum high these teased stocks reached following the recommendation would be useful as not everyone is a buy and hold investor. Sometimes these stocks get a good pop folowing the reco which could be profitably traded by some.

Gravity Switch
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February 14, 2008 12:51 pm
nvestgrrl and Pete, I certainly agree with you. I’m hoping that I can figure out a way to get that kind of information in a trackable form. Though of course, finding a “maximum high” and giving credit for that also assumes that the adviser or any investor would catch that high, which can be very difficult — though I do think being able to track the range would be useful. I watch this spreadsheet at least every couple days, and performance does certainly move around quite a bit — but given how many stocks are teased as being a “potential… Read more ยป
kalidasa
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February 14, 2008 1:05 pm

StockGumShoe,

AWESOME JOB ๐Ÿ™‚ You are the best!

One suggestion: Can you add a worksheet and move all your comments to it. This way, stocks can be sorted!

Hollis Whitney
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February 14, 2008 1:14 pm

Whit says:

Your unbiased comments happily received by a former newsletter subscriber. It is a pleasure to finally have someone who tells it like it is. My future in the market is now resuscitated. I was ready to go all CD’s.
I do have one stock that may be worth a look. ENEI.OB My 2K @ .46 now worth .86.
Best,
Hollis Whitney

Doctrb
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Doctrb
February 14, 2008 1:56 pm

Take credit for performing a truly valuable public service. I salute you! Please keep up the good work. Most of your comments are cautionary after disclosing what the “tease” is “teasing.” Do you ever recommend a particular stock without caveats? I would be interested in your reasons for choosing a stock that you would feel comfortable and safe in purchasing. Again, great job!

JoeGil
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JoeGil
February 14, 2008 2:10 pm

Travis, you say “just for entertainment,” but I think it is far more than that. It injects a needle of reality into the inflated hype of the teasers.

Ghamal
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Ghamal
February 14, 2008 2:54 pm

Gumshoe – You’re the man!
I really hate feeling like I’m missing out whenever I get one of these teasers. Now I see that I’m not missing anything.

KEN HAPKE
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February 14, 2008 8:26 pm

‘The Oxford Club’
WHAT IS THEIR DEAL?
Oh, I know it is not related to this subject, but I know you know these people.
Your comments are appreciated.
Ken

aleksy
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aleksy
February 14, 2008 9:59 pm

Gumshoe,

Roses are red,
Violets are blue
Thank you, thank you,thank you
for all that you do!

Happy Valentine’s Day

p.s. how did you get to be such an incredible sleuth anyway?? ๐Ÿ™‚

Dan
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Dan
February 15, 2008 2:00 am

Thank you. Your a good guy.

Wayne
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Wayne
February 15, 2008 2:41 am

Mixed feelings. I subscribe to a couple of newsletters. I see teasers selling them and can see that the stocks used for the teasers are “once were” names. The letters are dropping them and have nothing to lose if readers try to use the advertizing for advise. On the other hand, a lot of mainstream names in the letters really are not doing any better. I have made a (very) little money in my market efforts because of wild hare things I did on my own. Pure luck. ? ?

Wayne
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Wayne
February 15, 2008 3:35 am

For Ken Hapke: Oxford Club is a unit of Agora Publishing (to the best of my current understanding). Oxford Club is OK (use with appropriate caution like Cramer says); subscribers get a lot of ‘free’/available-only-for-subscribers other stuff that can be helpful or informative. Mainly, Agora uses OC for a first screen to find individuals who can and will pay (a lot more) for other products. At least in my opinion. I intend to continue my subscription solely because I am hooked on the extras (at least for a while).

Francois
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Francois
February 15, 2008 9:44 am

An excellent website. Good humour. I am looking forward to your “spreadsheet tinkering”, other improvements and possible sense that can be made from this. Keep it up!

Roy Dolton
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Roy Dolton
February 19, 2008 10:22 am

By luck I must have found you soon after you started (thank goodness). It’s saved me money and anxiety. Snag for us in England is that a lot of foreign (i.e. U.S. and other countries) shares are difficult to buy unless they are large.
Many thanks.

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