2019 Stock Picking Contest: 3Q Results

Things are getting interesting in the 2019 Stock Picking Contest. (You can read about the contest start here, and view the 1Q and 2Q updates if you’re the thorough type.)

Ian Bezek continues to dominate, and there are rumors that he is already icing the bubbly to celebrate what will surely be his life’s crowning achievement. 

We have only a quarter left to finish the dogfight for second place. 

We’re just about to conclude the proof that Nelson of Financial Uproar (RIP) / Canadian Dividend Investing is way smarter than PK of Don’t Quit Your Day Job. (Nelson has closed all but one position and is hoping to sit on his lead and run out the clock to year end.)

Due to a nuance of the How the Market Works contest, we can determine which entrants have not logged in for some time. PK, TawCan, FI Garage, and Wandering Steve are clearly not minding the store. Wandering Steve, who either is in the midst or a year-long sabbatical / RV adventure or was eaten by a polar bear, at least has an excuse. But the others do not, and they seem to be relying on a spurious “buy-and-hold” strategy that clearly won’t rule the day. 

I remember Erik and Coco holding hands in solidarity at the contest’s start and joking, with similar trades, who would come in last place. But then Erik shouted, “Hey – look over there!”, and while Coco was distracted, he ran off and started trying to actually win this thing. Poor Coco. Bamble will provide you company, as he is far more loyal than Erik.

Odysseus from Odyssey to Fire, like his namesake, is taking a while to get to the promised land, but he’s steadily climbed the table and may even challenge for the medal stand.

Remember when our Money Maaster Jordan was talking smack on like the 3rd day of the contest? That was funny.

Dividend Growth Investor and Matthew (All About The Dividends) were both sanguine about their pedestrian showing. They commented, “We feel over the long term that dividend stocks are going to outperform and we will rise to the top of the table.” When reminded that the stock picking contest would conclude at the end of this year, they responded with a shocked, “Wait! What?” They were last seen running screens for near-penny stocks to take a final swing for the fences. Good luck, guys.

Mr. Tako and I had somewhat similar strategies for most of the year. However, his questionable “go long” and “buy quality companies” approach is starting to falter.

The two-legged members of my household are doing well, with both of my sons near the top of the table. They were excited to hear that they too could join Nelson in the “we’re smarter than PK club”, but when they asked, “Wait – is this the same PK who is terrible at fantasy football?”, they realized it’s a rather modest laurel.

With almost two years of data in the books, I’m slowing coming to the conclusion that my dog Bamble is terrible at picking stocks. His only solace is that he’s outperforming Mr. Smith, who you’ll remember is likely the most finance-credentialed entrant in the entire contest. 

I think that just about covers it. Is there anyone I’ve missed? Wait – what is that in Ian’s rearview mirror? My goodness! Someone is coming up – FAST. Who is this smiling and handsome lad who has jumped almost the entire field in a single quarter and seems to have a Midas touch with every trade? Oh – this is embarrassing. 

At the end of 2Q I decided I needed to work myself up to the top of the table or have a Chernobyl-like meltdown. I shorted Tesla, Uber, AMD, Whirlpool, Lyft, and Eldorado Gold (how’d I find this last one? It was one of Bamble’s previous year picks…), and they all worked out. I did a long-short pair of American Airlines and Southwest Airlines and even got that right. I went long Aflac and that’s working out too. But I’m the first to admit there is no skill involved. You know that guy at the craps table who, in the wee hours of the morning, puts all of his money on one final throw of the dice and then wins, and wins again, and again? Even though he’s being stupid and deserves to get wiped out? That’s me! (Disclosure: I own LUV, AA, and AFL in real life.)

I’ll save the lengthy lessons learned and wisdom gained for our year-end wrap-up post, but there are already some interesting observations. Bamble probably isn’t so terrible a stock picker – large caps have continued to rule the day, and his methodology was biased toward small and mid caps. Ian (and now I) may have put up nice numbers with frantic trading and lots of shorts, but my sons (Little Paul, 12, and Super Little Paul, 8) seem to be doing just fine with a buy-and-hold, and they don’t have much of a finance background. It’d probably be a better lesson if my wild bets had blown up in my face, but we still have all of 4Q for that 🙂

It’s not too early to start thinking about the 2020 contest. The How the Market Works platform is easy to use, and the contest is open to anyone. You’ll have fun trading with friends, we’ll share some laughs and good-natured ribbing, and you’ll probably be out-picked by a small child or a dog. If you’re interested send me a note or leave a comment.

Picture courtesy of Pexels