Content Changes and Portfolio Performance Update for 6/30/09

Thanks to those who reminded me to update what has happened to the subscriber newsletter and specifically the three VIX and More portfolios over the course of the last quarter.

Starting with the newsletter content, I see at least four areas in particular in which I have expanded and enhanced the information and analysis. These include:

• more earnings data and a new earnings surprise graphic
• increased focus on key economic reports, with an emphasis on looking under the hood at the full set of numbers to get at the nuances the major media headlines missed or glossed over
• a broader scope of analysis for the Volatility Corner feature and an expansion of the accompanying Volatility Update graphic
• a more detailed discussion of the Stock of the Week selection

With these changes, I have heard from some subscribers about the dangers of page creep. For now I am capping the weekly newsletter at 10 single-spaced pages and am targeting 8-10 pages for each issue.

The graphic below shows the updated performance data for the VIX and More portfolios since inception. To reiterate, these are long-only portfolios of individual stocks that do not invest in ETFs or options and are rebalanced only on weekends. The Focus portfolios derive their name from the fact that each portfolio is limited to only five stocks. The Focus Growth 2 Model Portfolio was launched on August 31, 2008 and utilizes the S&P 500 index as a benchmark; the Focus Foreign Growth, was launched on March 30, 2008 and uses as a benchmark the EAFE (Europe, Australasia and the Far East) Index ETF (EFA).

Focus Growth 2 was up 5.6% for the first half of the year, nearly doubling the performance of the benchmark SPX. The three stocks that were the strongest performers were FRPT, HRBN and HOGS. Even more impressive were the results turned in by the Focus Foreign Growth portfolio, which gained 56.1% for the six months ended 6/30/09, 52.4% better than the benchmark. The biggest winner was TSL, which gained 242% since being purchased in late February. The portfolio, which was heavily weighted in Chinese stocks during the second quarter, also benefited from a 124% gain in SNDA.

As impressive as the Foreign Growth returns were, the star attraction has clearly been the Stock of the Week ‘Sequential Portfolio,’ which ended June up 101% for the first six months of 2009. During the second quarter, the SOTW saw a streak of 13 consecutive gains come to an end. The biggest winner was Kirkland’s (KIRK), which gained 29.9% one week in the middle of May. For more details on specific picks, check out VIX and More Stock of the Week Selection Up 343% in 14 Months.

Starting next quarter, when I provide an update through September 30^th, I will provide some more detailed portfolio performance data in this space.

As a reminder, I am currently offering a 14-day free trial to the subscriber newsletter for new subscriber.

Finally, for those who may be interested, I updated the second quarter performance for EVALS earlier in the month in EVALS Q2 2009 Update: +18.47%.