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Model Portfolio Performance Update – Aug. 2012
Posted by: GuruFocus (IP Logged)
Date: August 2, 2012 01:25PM

Over the years, GuruFocus has developed model portfolios to test the strategies we developed. We have two types of model portfolios. The first one is based on Guru Strategies. They are called Most Broadly Owned Model Portfolio and Most Weighted Model Portfolio. The Most Broadly Held Portfolio consists of the 25 most popular stocks among Gurus. And the Most Weighted Model Portfolio consists of the 25 stocks that have the highest weighting in Gurus’ portfolios. These are the performances compared with S&P 500 since 2006:

All numbers do not include dividends.

Year S&P 500 Most Broadly Held Portfolio Most Weighted Portfolio
2006 11.8% 15.8% 22.1%
2007 3.5% -6% -1.9%
2008 -38.5% -29.6% -34%
2009 23.5% 32.9% 41.8%
2010 12.8% 12.7% 15.1%
2011 -0% 0.5% -15.8%
2012 9.4% 13.8% 4.7%
Screener Links Screener Here Screener Here


We can see the Most Broadly Held Portfolio has been doing very well. It outperformed the S&P 500 six out of the last seven years, including this year. Its year-to-date performance is 13.8%, compared with the S&P 500’s 9.4% up to August 1. The best performances in the portfolio include Apple (AAPL), Wal-Mart (WMT), Disney (DIS), Visa (V), etc. These are the most popular stocks among Gurus. They did well. Check out the details of the Most Broadly Held Portfolio here.

If you want to follow Gurus, the Broadest Owned Portfolio is the preferred way by GuruFocus. We wrote a DIY Guide on How to Invest Using Guru Strategies. We recommend you to read it.

The second type of strategies are proven Value Strategies. These are their performances:

Value Strategies (Long):

All numbers do not include dividends.

Year S&P 500 Buffett-Munger Screener top 25 Top 25 Undervalued Predictable Companies Top 25 Historical Low P/S Ratio Companies Top 25 Historical Low P/B Ratio Companies
2009 23.5% 29.1% 56.7%
2010 12.8% 19.1% 19.4% 19% 16.4%
2011 -0% 6% -3.3% -2% -1.9%
2012 9.4% 9.7% 1.2% 7.4% 7.5%
Screener Links Screener Here Screener Here Screener Here Screener Here


Among the four portfolios, the Buffett-Munger model portfolio shows the most consistent performance. It beat the S&P 500 every year since inception in 2009. Undervalued Predictable Companies has the best overall performance.

Which one should you invest in if you want to follow GuruFocus’ value strategies? We recommend Buffett-Munger Strategy. This strategy invests in high-quality companies at reasonable prices. The overall risk is smaller.

Buffett-Munger strategy is also what we used in our backtesting research. Please read the details of our study:

· What worked in the market? Part I

· What worked in the market? Part II

· What worked in the market? Part III

You can check out the stocks that are in the Buffett-Munger model portfolio here.



Stocks Discussed: AAPL, WMT, DIS, V,
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