RiverNorth/DoubleLine Strategic Opportunity Fund (RiverNorth/DoubleLine Strategic Opportunity Fund) Predictability Rank

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What is RiverNorth/DoubleLine Strategic Opportunity Fund Predictability Rank?

Not Rated

Warren Buffett said many times that the companies he likes are:

1. Simple businesses that he understands
2. that have predictable and proven earnings and
3. with economic moat
4. those can be bought at a reasonable price.

It is hard to quantify "simple businesses that he (Buffett) understands", so we will focus on the other three characteristics instead. In GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank, we will show that the businesses that have predictable and proven earnings are usually also simple businesses that an average person could understand.

GuruFocus conducted a back test study of Warren Buffett's strategy of "buying good companies at fair prices" for the years from 1998-2008.

RiverNorth/DoubleLine Strategic Opportunity Fund Predictability Rank Calculation

In our database there are 2403 stocks that have been traded from Jan. 2, 1998 to Aug. 31, 2008. We have the complete 10-year financial data and trading prices of these companies for this period. We rank the predictability of these companies based on the consistency of their revenue per share and EBITDA (earning before interest, tax, depreciation and amortization) per share over the past ten fiscal years, and study the correlation between the stock performances and the predictability of the business.

Our study may be subject to these biases and assumptions:

Dividend yields are not counted for investment returns
Effects of price changes due to spin-offs may not be fully adjusted
Study is subjected to survivorship bias due to de-listing, bankruptcy, LBO, M&A, etc.

The correlation between business predictability and investment returns of a company is showed below.

Correlation Between Business Predictability and Investment Returns

	Predictables	Non-Predictable	All stocks
Total Number of stocks	570	1833	2403
Total Lost Money	61	830	891
Total Lost More Than 50%	18	412	430
Total Lost More Than 90%	4	86	90
Average Gain	260.6%	100.0%	138.1%
Median Gain	150.0%	13.0%	39.0%
Maximum Gain	2852.0%	11483.0%	11483.0%
Maximum Loss	-100.0%	-100.0%	-100.0%
Annualized Average Gain	12.7%	6.7%	8.4%
Annualized Median Gain	8.9%	1.1%	3.1%

For the 570 predictable companies, we have seen strong correlation between the predictability of businesses and the stock performances over the past 10 years, regardless of the valuation of business at 1998. Accordingly, we have ranked the business predictability from 5-star to 1-star, as shown in this table.

Predictability Rank	5-Star	4.5-Star	4-Star	3.5-Star	3-Star	2.5-Star	2-Star	1-Star (non-predictable)	Average among all
% Out of All 2403 Stocks	3.3%	2.9%	3.7%	3.3%	3.3%	3.7%	3.3%	76.3%	100%
% that are in Loss (10y)	3%	10%	8%	9%	11%	18%	16%	45%	37%
Average Gain (10y)	364.6%	330.9%	278.0%	235.1%	243.5%	227.8%	154.8%	100.0%	138.1%
Median Gain (10y)	238.5%	193.5%	171.0%	159.0%	132.5%	113.5%	87.0%	13.0%	39.0%
Maximum Gainer	2228.0%	2547.0%	2452.0%	2852.0%	2432.0%	1892.0%	1807.0%	11483.0%	11483.0%
Maximum Loser	-82.0%	-53.0%	-67.0%	-100.0%	-83.0%	-100.0%	-78.0%	-100.0%	-100.0%
Annualized Average Gain	15.4%	14.6%	13.2%	12.0%	12.2%	11.7%	9.1%	6.7%	8.4%
Annualized Median Gain	12.1%	10.6%	9.8%	9.3%	8.2%	7.3%	6.0%	1.1%	3.1%

For detailed information about each predictability rank, please go to GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank

RiverNorth/DoubleLine Strategic Opportunity Fund Predictability Rank Related Terms

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RiverNorth/DoubleLine Strategic Opportunity Fund (RiverNorth/DoubleLine Strategic Opportunity Fund) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Asset Management » RiverNorth/DoubleLine Strategic Opportunity Fund Inc (NYSE:OPP) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

360 S. Rosemary Avenue, Suite 1420, West Palm Beach, FL, USA, 33401

Website

https://www.rivernorth.com

RiverNorth/DoubleLine Strategic Opportunity Fund Inc is a closed-end management investment company. The company's investment objective is to seek current income and overall total return.

Executives

Lisa Bruckert Mougin	director	C/O RIVERNORTH CAPITAL MANAGEMENT, LLC, 360 S. ROSEMARY AVE., SUITE 1420, WEST PALM BEACH FL 33401
David Swanson	director	325 N. LASALLE ST., SUITE 645, CHICAGO IL 60654
Stephen Andrew O'neill	other: Portfolio Manager	360 S. ROSEMARY AVE., SUITE 1420, WEST PALM BEACH FL 33401
John S. Oakes	director	325 N. LASALLE STREET, SUITE 645, CHICAGO IL 60654
Brian H Schmucker	other: OFFICER OF THE INVT ADVISER	325 NORTH LASALLE STREET, SUITE 645, CHICAGO IL 60654
Patrick W. Galley	director, officer: President	360 S. ROSEMARY AVE, SUITE 1420, WEST PALM BEACH FL 33401
Jerry Raio	director	360 S. ROSEMARY AVE, SUITE 1420, WEST PALM BEACH FL 33401
John Wayne Hutchens	director	360 S. ROSEMARY AVE, SUITE 1420, WEST PALM BEACH FL 33401
Youse Guia	other: Exec Comm Mbr: OPP Subadviser	C/O PIMCO, 650 NEWPORT CENTER DRIVE, NEWPORT BEACH CA 92660
Leticia A. Acosta	other: Exec Comm Mbr: OPP Subadviser	333 SOUTH GRAND AVENUE, SUITE 1800, LOS ANGELES CA 90071
Rivernorth Marketplace Lending Corp	other: Investment Adviser	360 S. ROSEMARY AVE, SUITE 1420, WEST PALM BEACH FL 33401
Fred G Steingraber	director	325 N. LASALLE STREET, SUITE 645, CHICAGO IL 60654
Marcus L Collins	officer: CCO and Secretary	325 N. LASALLE STREET, SUITE 645, CHICAGO IL 60654
Jonathan M. Mohrhardt	officer: CFO and Treasurer	325 N. LASALLE STREET, SUITE 645, CHICAGO IL 60654
John K Carter	director	433 W. VAN BUREN STREET, SUITE 1150-E, CHICAGO IL 60607