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The Investor SuperModels By Jon D. Markman
Since the start of 1998, the Investor editorial team has created and published a set of strictly
mechanical stock portfolios derived from Investment Finder screens. We modestly called them the
SuperModels. To monitor our efforts, and learn how you can build and benefit from your own versions,
check our regular progress reports and the links to individual SuperModels below.
Flare-Out Growth
10 stocks that have
rocketed in the past 12
months but faltered
recently
• Portfolio
Today's Picks
Redwood Growth
10 high-quality growth
stocks
• Portfolio
Today's Picks
Defensive Growth
10 stocks with consistent
growth, profitability and
dividend yield plus
market-beating price
gains
• Portfolio
Today's Picks
About the
SuperModels
Volatility
Momentum stocks can
be rewarding but also
present great risks.
Consider them only for
the aggressive growth
portion of your portfolio.
Rebalancing
The portfolios will be
rebalanced each quarter
in 1999.
Returns
Returns for each quarter
are calculated by
totaling gains and losses
of each portfolio's stocks
and dividing by the
number of stocks. The
models' total annual
returns are the sum of
the quarters' changes.
The Investor 30
To round out The
Investor 30, some
models feature more
than the recommended
10 stocks to compensate
for the securities that
appear in more than
one model.
Rebalancing Schedule
Qtr.
Buy
Sell
1
12/30/98
3/26/99
2
3/29/99
6/25/99
3
6/28/99
9/24/99
4
9/27/99
12/31/99
Feb. 25, 1999: Tech '99 best of show -- AOL, eBay and Cisco
Over the past four days, BancBoston Robertson Stephens turned the
basement of a swank San Francisco hotel into a virtual shopping mall of
technology stocks, a gorgeous emporium for public companies promising
everything from the mundane (digital postage stamps) to the marvelous
(Internet-ready kitchen appliances).
In the old days, brokerages like Robby Stephens staged these events to
introduce their institutional brokerage clients to their investment banking
clients; the gatherings were genteel and hushed. Today, they're still gilded
affairs, but with more of a carnival atmosphere. Young companies are more
crazed for investors' confidence than ever before, since most are selling a
hazy dream of the future rather than earnings from a solid bill of goods.
The manic purchase of stocks based on
expectations of future returns in exciting new
industries without historical foundation is virtually the
definition of a financial "euphoria," according to
economist John Kenneth Galbraith. And historically,
euphorias end very badly. But we own a lot of these
stocks in our SuperModel portfolios, nonetheless,
because they fit our price or earnings momentum
models. So I took the bait on Monday and Tuesday
and stalked the halls of Tech '99 to learn more. I'll dump my notebook here,
next Wednesday and in following weeks as I turn in my SuperModel updates.
Web-everything
Robertson Stephens' research director aptly noted in opening remarks that the
World Wide Web is "casting a growing shadow." Almost every technology
company today is focusing its attention on Web-based applications, Internet
infrastructure, communications and connectivity. Your new economy is
brought to you by the letter "e": e-business, e-commerce, e-tail, e-payment
and the new word for what used to be called a business, the enterprise.
Before you say "E-yuck!" consider the example of Cisco Systems (CSCO),
arguably the most important company in the networked world today.
Once upon a time, Cisco built equipment called routers that connected
businesses' internal data networks together. It was a nice niche that offered
exceptional growth, but nothing like the opportunities it faces today. The
company's goal, according to Executive Vice President Don Listwin, is to
restructure the $360 billion world ecosystem of fragmented
telecommunications equipment into one that's standardized for data according
to Cisco ideals. "We think it's good for us because we are good at leading
standards," he said. |
