The 1-1-1 challenge update!
> The challenge: One million, one stock, one year. If I gave you P1 million, but the condition was that you could only buy one stock with it, and you had to hold that stock for one year, which stock would you pick? This was the prompt that over 60 readers responded to back on Aug. 20, 2023.
> Time capsule: On Aug. 20, 2023, the PSEi was back at 6,290, inflation was at 5.3% y/y, the Maharlika Investment Fund was just railroaded into law, and GCash had just received approval to publicly launch its in-app stock trading platform.
> Stock pickers: We had 66 readers submit their 1-1-1 picks. Some submitted multiple picks, but most stuck with the “1-1-1” spirit of the challenge. Remember, each pick represented a fictional P1M investment.
> Clear champion: There was only one reader who picked a stock that increased more than 100%. Bojji picked STI Education Systems [STI 0.95, down 3.1%; 250% avgVol], which is up 142% over the past 12 months (TTM) and would now be worth P2.42 million.
> Other winners: Second place was a tie between Comedian and Paolo who picked International Container Terminal Services [ICT 412.00, up 4.0%; 214% avgVol], which is up 85% TTM and would now be worth P1.85 million. Third place goes to Frank Ngan who picked Apex Mining [APX 4.49 unch; 57% avgVol], which is up 75% TTM and would now be worth P1.75 million.
> Clear “not winners”: There are winners and there are losers. Such is the nature of the market. The top loss went to Kurama who picked Phoenix Petroleum [PNX suspended] which is down 46% TTM and would now be worth P0.54 million. King Ark registered the second-highest loss after picking Max’s Group [MAXS 3.00, up 0.3%; 85% avgVol] which is down 34% TTM and would now be worth P0.66 million. The third-highest loss went to Ser Ced who picked Bloomberry [BLOOM 7.90, up 2.6%; 45% avgVol] which is down 30% TTM and would now be worth P0.7 million.
> Overall performance: In aggregate, readers were able to return a portfolio worth P73.3 million from a starting portfolio of P66 million. That’s an average gain of P110,000 per portfolio (+11%). Of the 66 readers who picked, only 18 of the picks lost money. Keep in mind that this was just for funsies and I didn’t go down the rabbit hole of counting up dividends that might have accrued to each holder, or account for taxes or commissions or any of that other real-life stuff.
MB bottom-line: The PSEi is up about 10.4% TTM, so the 66 readers managed to put their heads together and beat the market. Just barely, though. Ignoring its constant liquidity problems and iNAV calculation errors, FMETF’s TTM return is 12.1%. There were a few readers who dumped the whole milly into FMETF. Ok, so 11% is pretty good, but that is just the nominal rate of return. What was the real rate of return once we factor inflation back into the mix? The CPI data from August 2023 to July 2024 says that we experienced 3.3% inflation over that period. Divide our nominal rate of return (11%) by the inflation rate (3.3%), and we get a real rate of return of 7.5%. Not bad! Want to see your name in next year’s 1-1-1 challenge review? Make your pick now on my Twitter post that went live earlier this morning! Click here to check it out.
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