The Magic Formula portfolio is relatively flat compared to the S&P 500. Having so much cash is really making it tough to get a real view of the magic formula performance. Thus, I will add 2 stocks each month in order to avoid having a cash hoard. Also, Chris made a great observation in the last post about portfolio policy. Each stock will now be sold after one year.

So it is time for this months purchases.

Airvana, Inc. (AIRV) provides network infrastructure products used by wireless operators to provide mobile broadband services.The company currently trades with a pretax earning yield of 91% and pretax return on capital greater than 100%.

,Avici Systems (AVCI), Inc. provides resource control systems that realize NGN software-provisioned services in the new Carrier Ethernet transport network. The company currently trades with a pretax earning yield of 99%! and pretax return on capital greater than 100%.

I also added SOAP.

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