High-performance Value Investing | Results | IntelligentValue.com





Investing based on fundamental value is an approach that has created thousands of millionaires and dozens of billionaires... and that cannot be said of any other investment approach.

While not everyone has the goal of become a millionaire through investing, while saving for your children's college education or a comfortable retirement, you still might want to put your hard-earned money to work in the same very safe and very high-return investment approach used by smart-money billionaires such as Seth Klarman, Whitney Tilson, or Warren Buffett.  Even if you don't want to commit your entire portfolio to the value approach, as a way to diversify, it is certainly prudent to have at least a portion of your portfolio committed to undervalued equities.

The fact that you have found IntelligentValue.com and are interested in learning about this approach means that you are different from the average investor.  Most investors regularly buy what amounts to a lottery ticket on the latest, hot, 'story stock' featured on TV or in the press.  Instead of going down that speculative path and gambling on unpredictable future outcomes, you are attracted to the clear and compelling logic behind the value approach to investing and may soon be able to count yourself among the large family of investors who have grown wealthy from its application.

On this page, we'll examine the results of the our model portfolios since 2004, and you'll learn how the tools IntelligentValue.com provides will help you quickly and easily incorporate a highly profitable, value-based component into your overall investing strategy. 




Our Blue Chip Value Portfolio (BCV) purchases quality S&P 500 companies ($3B to $750B+ market capitalization) in an upward price trend, which are undervalued compared to their peers. From this universe of America's most well-known, most substantial companies, we pick the equities that are most undervalued based on five different fundamental criteria. The result is very steady returns from companies with names with which we are familiar and very low drawdowns. A good measure of the excellent risk-adjusted returns from this portfolio comes from its very high Sharpe Ratio, which stands at more than 2.00! This portfolio is suitable for all investors because the constituent's large market cap ($3 billion+) and ample volume will accommodate virtually any size investment.

Example holdings in the BCV Portfolio include such well-known names as Progressive Insurance, Goodyear Tire & Rubber Co, Best Buy, The Gap, Allstate Corp, NRG Energy, AFLAC Inc, Tesoro Corp, First Solar, Southwest Airlines, United Continental Holdings, Western Digital Corp, Xerox Corp, and other easily recognizable companies with a rich American tradition.

Here's an up-to-date summary of the BLUE CHIP VALUE Portfolio's results:

BLUE CHIP Value Portfolio 

ANNUAL RETURN OCT 3, 2011 - JUNE 25, 2017: 45.83%

SUMMARY Portfolio Results

Portfolio Total Return: 5,806.80% Benchmark (S&P500) Total Return: 267.87%  
Portfolio Annualized Return:
64.12%    Winners: 70.34%   Avg Return: 12.61%  
Biggest Winner:
431.01%     Biggest Loser: -28.41%    Max Drawdown: -23.12% 
Avg Hold Time: 3.16 months    Sharpe Ratio: 2.32     

Note: All statistics include dividends and an $8 commission both ways on stocks or a $4 commission both ways on ETFs.

The Blue Chip Value Portfolio has strong upward price momentum with very low drawdows and a Sharpe ratio of 2.32.



For the RELATIVE VALUE Portfolio, we are scouring the mid-to-large capitalization ($800M+) universe of stocks, represented by the Russell 1000 (and not in the S&P 500, so there is no conflict with the BCV portfolio), for undervalued opportunities. In this portfolio, we are not looking for stocks that are beaten down in price, but rather, quality companies that are selling at a relative discount to their peers. 

We do not apply maximum Price-to-Asset ratios in this portfolio, but simply purchase the top-ranked stocks that are selling inexpensively when we consider a variety of proven fundamental factors as a whole. The RELATIVE VALUE Portfolio approach is similar to that of famous value investors Warren Buffett or Whitney Tilson.

Here's an up-to-date summary of the RELATIVE VALUE Portfolio's results:

Relative Value Portfolio 

ANNUAL RETURN MAR 9, 2009 - JUNE 25, 2017: 64.12%

SUMMARY Portfolio Results

Portfolio Total Return: 5,806.80% Benchmark (S&P500) Total Return: 267.87%  
Portfolio Annualized Return:
64.12%    Winners: 70.34%   Avg Return: 12.61%  
Biggest Winner:
431.01%     Biggest Loser: -28.41%    Max Drawdown: -23.12% 
Avg Hold Time: 3.16 months    Sharpe Ratio: 1.32     

Note: All statistics include dividends and an $8 commission both ways on stocks or a $4 commission both ways on ETFs.

IntelligentValue.com will provide you with a treasure trove of these undervalued companies.  The primary focus of our business is to identify quality companies that are selling at a discount to their intrinsic value.  We are not talking about highly volatile over-the-counter or penny stocks. We select our undervalued stocks from a universe of substantial companies from both the Russell 2000 Index (DEEP VALUE Portfolio) and the S&P 400 and S&P 500 Index (RELATIVE VALUE Portfolio). 



Our DEEP VALUE Portfolio identifies small companies ($200M to $1B market cap) that are selling at a dramatic discount to their intrinsic value.  This is frequently a result of investor disenchantment with a company's industry or perhaps a particular company that has had an earnings miss or other underperformance in the recent past. The emotional nature of the masses frequently over-punishes companies during a selloff as their price is swept too far downward. 

These situations are perfect opportunities for value investors to take advantage of the capricious nature of markets.  We establish a value based on the businesses of these companies, taking into consideration information that is more realistic and less optimistic than is customary on Wall Street. In other words, we value these business then subtract a significant percentage to reach a significant margin of safety. If the price is below that level, it may be a Buy.

For our DEEP VALUE Portfolio, we identify companies that are selling on the public equity markets at a significant discount to fundamental ratios related to book value, cash, current assets, cash flow, free cash flow, sales, gross profits, operating income and other value-based criteria that our research shows is highly correlated with future stock price performance. 

Our DEEP VALUE Portfolio utilizes an approach that has created many wealthy investors: buy cash flow and cash-flow-generating assets when they are temporarily selling at a deep discount. The DEEP VALUE Portfolio approach is similar to the approach of famous value investors Benjamin Graham, Seth Klarman, or Walter Schloss.  However, we add the additonal enhancement of choosing these stocks when technical price analysis tells us they are oversold and beginning to turn higher.

Here's a current summary of the DEEP VALUE Portfolio's results:


ANNUAL RETURN MAR 9, 2009 - JUNE 25, 2017: 102.40%

SUMMARY Portfolio Results

Portfolio Total Return: 31,771.40%  Benchmark (Russell 2000) Total Return: 302.83%
Portfolio Annualized Return:
102.40%   Winners: 66.41%    Avg Return: 24.66%
Biggest Winner:
261.12%    Biggest Loser: -28.06%    Max Drawdown: -26.54%  
Avg Hold Time: 3.26 months     Sharpe Ratio: 1.41

Note: All statistics include dividends and an $8 commission both ways on stocks or a $4 commission both ways on ETFs.

For each of these portfolios, we require that each stock have high liquidity for our investment.  This liquidity (Price x Volume) insures that you can enter or exit your positions at the time of your choosing, not at the time of choosing of the rare buyer, as can occur with low-liquidity stocks.


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Value investing is the concept of buying a stock for less than the share price of a company's intrinsic value, then selling in the future at full value or more.  In the words of Warren Buffett, value investing is like "buying a dollar bill for 50 cents."   It's bargain-hunting, classic 'buy low and sell high.'   However, the critical element to its success is to remove emotional decisions from the process by quantifying the selection and both the entry and exit points of the equities selected. 

Therefore, we try to take the biased, emotional, human element out of the equation as much as possible.  Since 2004, the success of our quantitative stock-selection system has been proven in successful, long-term use by our subscribers.  We are proud to have many members who have been with us for the duration; since IntelligentValue's launch in 2004.

Hoping for growth is not an investment strategy: The vast majority of investors put their money into stocks they think will grow in the future.  By doing this, they hope the value of their stock and their investment/retirement portfolio will also grow.  However, any method that depends on a stock's price growth based on consistently increasing future profits is purely speculative, and if we are honest, just wishful thinking. The volatile years since 2000 have been a painful reminder of this fact as overall stock prices have plummeted by 50% not once, but twice.  Investors who were not in value-based stocks experienced a terrifying rollercoaster ride and many have not returned after selling at the bottom.

Instead of this quixotic, wishfully-hoping for earnings-growth approach taken by the majority of investors, we take another approach. We identify and purchase cash-generating assets priced below their current, intrinsic value (as opposed to a guess about their future value), then sell when the asset has regained full value.  You rarely find a situation where private parties will sell a solidly valuable asset at a discount of 30% - 70% of the asset's market value.  Just consider the purchase of real estate, a rare automobile, farm, or a private business. You'll almost never get a chance to buy one of those properties at a significant discount unless it is encumbered by complications. 

However, you can regularly buy assets in the U.S. public stock market when they are temporarily beaten-down (from investor fear, disregard, or disaffection). Then you can easily sell those assets later - in the same marketplace and at the time of your choosing for a sizable profit as other investors inevitably discover the price discrepancy.

That approach requires these essential elements: removal of the influence of what Buffett calls the "super-contagious emotions that swirl about the marketplace." A rigorous quantitative discipline and consistent identification of undervalued companies founded on proven, asset-based fundamentals provide us with these incredible returns year after year. 

IntelligentValue.com has consistently beaten the market by a wide margin. Our portfolios have double and triple-digit annual returns!

At IntelligentValue, I really get an understanding as to why we are buying or selling and what factors are affecting the markets; in other words, getting real value added with an amazing emphasis on transparency and accuracy."  
- David B., Mexico City, Mexico

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