Quality At Any Price Vs Quality At Reasonable Price - Year 1 Update

Image Courtesy: Freedigitalphotos.net/mapic hai

Last year, I started to track the performance of two distinct portfolios.  You can refer to the post here.  The first portfolio consisted of high quality high PE stocks and the second one consisted of reasonable quality low PE stocks.  Idea was to compare how these portfolios perform over long periods of time.  This is just the first year and the clear winner for this year is Portfolio 1 which is high quality high PE stocks. While this seems to be in line with what experienced value investors say, we need to observe and check if it stands the test of time.  We will review it next year and check how these portfolios have performed.  For those that are interested in the details, the portfolio valuation and returns as it stands today is given below.  Those stocks with an asterix (*)  mean that the price has been adjusted for bonus and splits.

Portfolio 1 :

Portfolio Annualized Return :  21.54%

Stock	Year 1			Year2
	Price	PE	Invested Amount	Price	PE	Current Value
Jubiliant Foodworks	1340	76	10000	1524	83	11373
Page Industries	10743	68	10000	12969	67	12072
Symphony	1909	62	10000	2321	65	12158
La Opala	410	62	10000	612	70	14927
Berger Paints *	253	53	10000	252	57	9960
Britannia Industries	1793	52	10000	2910	54	16230
Pidilite Industries	484	50	10000	553	46	11426
Astral PolyTechnik	420	46	10000	432	71	10286
GSK Consumer Healthcare	5807	45	10000	6691	45	11522
Dabur India	239	43	10000	277	42	11590

Portfolio 2:

Portfolio Annualized Return :  6.19%

Stock	Year 1			Year2
	Price	PE	Amount	Price	PE	Current Value
Munjal Auto Industries	113	11	10000	93	19	8230
Zensar Technologies	596	11	10000	1038	15	17416
VST Tillers	1349	13	10000	1350	17	10007
eClerx Services *	897	15	10000	1484	25	16544
Wipro	557	16	10000	557	16	10000
Swaraj Engines	934	16	10000	956	25	10236
VST Industries	1912	17	10000	1662	19	8692
Kaveri Seed Company	782	18	10000	347	11	4437
Suven LifeSciences	210	18	10000	267	36	12714
Tech Mahindra *	653	21	10000	517	18	7917