Rail Renaissance — A just-for-fun attempt at being a railroad tycoon.
I’ve always loved railroads. Why? I’m not sure. Some of my earliest memories are of counting the cars on the tracks behind our Middletown apartment. In the years since, I…
- built train sets,
- circumnavigated the country by train, and
- joined the Air Force to be an engineer, only to discover it had the wrong kind of “engines.”
There are only two things left on my railroad bucket list: Owning a rail car, and becoming a rail baron.
While owning a rail car is not in the cards (at least for the forseeable future), this site is my attempt to achieve the latter, and try my hand a fundamental technical analysis at the same time.
At Rail Renaissance, you will find my index of the top stocks in North American rail — mainlines, services, and rail equipment manufacturers — selected using a fundamentally-weighted scheme. The Rail Renaissance NA20 Fundamental Index is comprised of the 20 companies with the largest fundamental value in the North American rail transportation sector. The index uses reported values of cash flow, book value, total sales, and dividend yield to figure index weight. Similar to the Fundamental Index method developed by Research Affiliates (RAFI), this approach breaks with the traditional price-based market cap weighted design, and instead derives weights from fundamental measures of company size. For more on how the stocks in the index are selected and rebalanced, see my methodology page.
The index was established on 28 September 2016 with Motif Investing. You can track performance of the index, or invest yourself, at Motif Investing. Note that I don’t earn a commission if you decide to invest in my index, but Motif Investing does pay me a nominal $1.00 if you choose to follow my weighting scheme.
In its first three months, , the NA20 index beat the S&P 500 by 15%. That’s not too shabby. We’ll see if my method holds up over time.
In 2017, I’m going to launch a market-cap weighted index similar to the NA20 index, but build using a pure market cap scheme. It will be interesting to see how the two indices compare over time.
Until then, see you on the rails.