37.9% for the spinoff portfolio in 2016

2016 was a great year for spin-off stocks in general, and spin-off shares I purchased in particular – my spin-off portfolio produced 37.9%, almost 4 times the return of the US market, which I measure by the S&P 500 index, that increased by 9.5 % this year.

Most of the shares in the portfolio performed positively this year, especially those sold from the portfolio. Here are the shares sold out of the portfolio in 2016:

SPX Flow (FLOW) – An Industrial Equipment maker that reached a peak of 30 dollars during the year, but decreased due to a sharp drop in oil prices. In view of the deteriorating financial results, I decided to sell the stock, unfortunately not in the optimal timing (since the stock soared later on with the recovery of oil prices), but I still sold it in a satisfactory profit of 56.7%.

Energy Talen (TLN) – the company was acquired by Riverstone at a price of $14 per share, which helped me to close the position at an impressive 126.3% profit.

Nuvectra Corporation (NVTR) – I bought this biomed stock because it was traded far below its net asset value (actually a Graham Net-Net stock), and thankfully after only one month it sprang up because of positive developments in the company, I took the opportunity to sell the stock at an attractive profit of 108.9%.

Liberated Syndication (LSYN) – This podcast company seemed to be a high risk from the start, but nevertheless I decided to purchase a small position because of the growth and exceptionally low pricing. However, on second thought I realized the problems around the company executives are too risky, therefore I decided to close the position. Luckily, I got out in time, even with a small gain of 2.9%, since the stock collapsed later on, and today it is about 45% below the buy price.

2017 is going to be a very interesting year in the stock market, certainly for the spin-off shares. In the last two years we are seeing a bloom of spin-off shares, so I hope to continue and find attractive opportunities for the portfolio.

Happy New Year!

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