In the quarterly update, Richard Beddard has added four new shares to the Nifty Thrifty portfolio.

To see the portfolio, click here. 

After six months, the Nifty Thrifty has yet to live up to its name. The portfolio is struggling to make money, while an investment in a FTSE All-Share tracker fund has risen about 12 per cent including dividends.

Of course, the first big test is after one year, next June, when we sell the first companies we bought and replace them with new shares picked by the computer. Hopefully then, I’ll have some concrete gains to report.

For this update I’ve only added four companies to the Nifty Thrifty. Although the aim is to populate it in quarterly tranches to avoid risking all the money in our virtual portfolio at once, those tranches are not of equal size.

I added 14 shares in June, four in September, four in December, and I’ll be adding eight in March to bring the total to 30. That’s because I want to make sure I’m using the most up-to-date data, and since more companies report their full-year results in the first half of the year than in the second, we have more candidates to pick from then.

In fact, of the companies reported in the last three months only 21 had F_Scores of five or over. The four highest ranked by Joel Greenblatt’s Magic Formula are Debenhams, WHSmith, Imperial Tobacco and Compass. The first three – two retailers and a cigarette manufacturer – are household names. The fourth, Compass, ran factory canteens during the Second World War, but now operates its own brands and franchises such as Burger King and Starbucks everywhere: in offices, hospitals, schools, universities and sports venues.

As well as feeding people it cleans and maintains buildings and their surroundings, and provides security, office and specialised services to government and industry.

Both Compass and Imperial Tobacco are among Britain’s biggest listed companies, with market capitalisations of £10 billion and nearly £20 billion respectively. Valued by the market at under £1 billion, Debenhams and WHSmith are much nearer the £500 million lower limit for the Nifty Thrifty portfolio.

The forthcoming January 2011 edition features Richard Beddard’s analysis of the Thrifty Thirty to date and explanation of an anomaly in the interpretation of the Magic Formula.