Not soon after launching our groundbreaking  RiskCurves research, PowerStocks Labs went to work to develop their 3rd "designer investing strategy" tailored specifically for the JSE, dubbed "BLUECHIP". PowerStocks Labs examined RiskCurve data from the 10 largest, most dominant shares on the JSE (together having a 0.85 correlation coefficient to the TOPI index) to determine, probalistically, which 5 shares displayed the following characteristics:

1. Least risk of losing money after 6 and 12 months
2. Most probability of  greater than 30% return after 12 months
3. Most probability of greater than 50% return after 12 months
4. Best 12-month risk adjusted returns.

The details behind this analysis can be read at the "Compare TOP-10 RiskCurves" research paper (subscriber logon required.) Five shares were selected with the above characterisitcs and a model portfolio dubbed "BLUECHIP" launched as at 3 March 2009. BLUECHIP has performed exceptionally well given the short time period, convincingly beating its peers in the TOP-10 group as well as the ALSH and the TOPI as shown below:



To keep track of BLUECHIP's progress, and of new developments we make with RiskCurves as we continue our lengthy cataloguing of all 400 JSE shares with RiskCurve data, go to the RiskCurves Strategy Blog.

To see the other "designer strategies" created by PowerStocks Labs, see "PowerShares : A designer Strategy for the JSE" and "We launch JSE TRAX-1"