Thursday, February 4, 2016

Data Mining The CCC List: Wrap Up


Company and sector allocation shouldn't be a concern for investors that are just starting out on their investment journey. However, once a portfolio reaches six figures I think allocation needs to start coming into play. Sector allocation shouldn't be the be all and end all of portfolio construction; however, paying some attention to it is part of the portfolio building process. If you don't believe me just ask how investors that were overweight energy over the last year or the financials in 2008/9 feel about it in retrospect.

Each component of the series can be found here.

Part 1 - The Challengers 

Part 2 - The Contenders

Part 3 - The Champions

Today I want to wrap things up by looking at the CCC list in its entirety and compare my current portfolio to see if there's any changes that I should/could make in order to optimize my dividend growth portfolio. By applying a few filters to the CCC list we can get a general overview of sector allocation among its members to help with allocation decisions for our own portfolios. I wouldn't recommend that anyone try to reach a target allocation based on the CCC list or any other group of stocks. A portfolio's sector allocation is just one concern of the individual investor and should be tailored to meet their own risk tolerance.

Continue reading the article on Seeking Alpha.


Image provided by renjith krishnan via FreeDigitalPhotos.net

6 comments:

  1. JC,

    Thanks for sharing the articles! To give you a heads up - the part 3 link isn't working for some reason, want to try and fix it before this article goes viral? Nice work!!

    -Lanny

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    1. Lanny,

      Thanks for catching that. Seeking Alpha was having all sorts of issues yesterday. Would love to see it go viral but so far I haven't been that lucky. Glad you enjoyed them. It was pretty interesting to see how each faction stood up and how my own portfolio looks compared to the CCC list.

      Thanks for stopping by!

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  2. PIP,

    Read these over on SA. I like the series (though as you pointed out above SA sometimes has issues). I like each list because it gives you different in each. Keep up the good work.

    -Gremlin

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    1. Gremlin,

      I'm glad you enjoyed the series and hope it can give some insight to other investors as their portfolio's grow and position and sector allocation become something they should at least pay some credence to. Obviously I wouldn't target the CCC list blindly but seeing which sectors tend to have more/better representation could tilt your company/sector targets when searching for new investment ideas.

      Thanks for stopping by!

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  3. Hi PIP, thank you for sharing your analysis on the CCC list Challengers, Contenders and Champions! It is obviously no small feat for a company to be included in these prestigious lists. While past performance does not guarantee future success, a great deal of these companies are very well positioned with wide moats, great products and services, and healthy balance sheets. I look forward to adding a few more Champions to my portfolio in 2016. Cheers, DN

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    1. Niche,

      I don't put as much stock in the moats and management commitment for many of the companies found on the Challengers list. A dividend growth streak between 5-9 years doesn't encompass the "Great Recession" in 2008/9. That doesn't mean that I don't own or want to own some of those companies because there's definitely some that I find attractive. HSY and V off the top of my head. I hope to add some more Contenders and Champions to my portfolio as well. Especially in the consumer staples, health care and financials sectors.

      Thanks for stopping by!

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