Winning Value Portfolio Corrected

 | Mar 12, 2014 | 4:00 PM EDT  | Comments
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Stock quotes in this article:

chk

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pot

I owe Real Money subscribers and readers a show of appreciation for catching an important omission on my part. Back in December 2013, when I was constructing the Winning Value Portfolio for 2014, I fine-tuned it with some name changes. In particular, I decided to replace industrial parts distributor Lawson Products (LAWS) with Iridium Communications (IRDM).

I'm humbled that some readers have been following this portfolio regularly enough to alert me that, while in my mind Lawson was out of the portfolio, I had failed to remove it. So, I was reporting erroneous results for the Gad Winning Value Portfolio. I'm sure Mr. Market is enjoying a very nice chuckle right now as so far this year, Lawson has actually been the best performer of the Class of 2014 -- it's up more than 20%, year-to-date. Readers should note that just because I took Lawson out did not mean I wasn't bullish on the name; rather I decided that Iridium was a better fit and better value proposition.

Correcting this oversight causes a decline in the year-to-date performance of the portfolio. Year-to-date, Iridium is up 10.4% vs. 20% for Lawson. As such, the 2014 Winning Value Portfolio, as of March 11, 2014, looks like this:

In the past five days, the price of GM Class B Warrants has fallen by another 13%. As I've said all along, day-to-day, week-to-week, or even month-to-month fluctuations are of no concern to me. I think the GM Warrants are becoming a very compelling purchase and I'm confident that if the market were to go into bear territory, this portfolio would do well.

Iridium is a hidden gem that will plug along. I think, however, the two to watch by year-end will be Chesapeake (CHK) and Deere (DE). I would even add Potash (POT) to that list. All three have an entrenched position in their respective industries and that is a very good thing when times get tough.

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