When this portfolio is fully invested, it contains 20-25 stocks. We seek out the fastest growing stocks in the world today. These positions are equally weighted within the portfolio. These stocks must also have both excellent valuation and momentum characteristics. These stocks are a little hotter than large-cap growth stocks.
These stocks can be large, mid, or small-cap stocks. Most fall into the small to mid-cap range, however.
This portfolio is best suited for Aggressive Growth Investors that have a time horizon of at least 3-5 years. Small and Mid-Cap generally more volatile than Large-Cap stocks. They also carry with them a higher degree of risk.
This is an actively managed portfolio. We keep a shorter leash on these stocks to protect on the downside, but we seek long-term capital gains if possible.
We will also do our best to protect this portfolio from the next recession and bear market. We cannot guarantee anything, but we will raise cash and employ inverse index or sector ETF’s when we feel that the U.S. economy is finally headed into a recession.
We cannot protect investors from normal sell-offs (5-20%) along the way. These are secondary reactions within a Primary Trend. There have been many such sell-offs during the last ten years, but during that time, the S&P 500 has gone from 660 to over 3,000. Every sell-off over the last ten years has been a buying opportunity.
We will do some selling and raise cash during short-term sell-offs as a precautionary measure. We do have a line-in-the-sand on all of our holdings. While extremely important, this protection could cost you some performance over the long haul, however. That is the trade-off for having such protection.
This portfolio was started on January 1, 2012. Year by year results can be found in our weekly Best Stocks Now Newsletter.
If this downside protection is not important to you, then consider investing in our Dividend and Growth Buy and Hold portfolio. We use the same value and momentum criteria for this portfolio, but we give these stocks a longer leash. We really strive for long-term, capital gains here.
Many of these stocks in this portfolio are also in the Active version of this portfolio. We give them a longer leash, however. We do make changes if there is a big fundamental change in an individual stock.
We will also take action if there is a big macro-change in the economy. Investors need to be willing to ride through 5-30% swings in this portfolio along the way.
This portfolio was started on January 1, 2019. Performance of this portfolio can be found in our weekly Best Stocks Now Newsletter.