2009 Mid-Year Report and Comments
Through the first half of this year, we’ve demonstrated once again that we know how to make money for our subscribers in a RISING market, as well as protect it when the markets decline.
To recap, last year (2008) was one of the worst years for stocks on record. Big double-digit declines hit all the major stock indices; worse still—for those too heavily exposed to commodity-related holdings—the pain was magnified. When all was said and done, though, The National Investor’s average recommended holdings finished the year essentially flat. We would have liked to do better; indeed, at mid-year we were the top letter in the country as measured by the Hulbert Financial Digest. In our mea culpa to subscribers at year-end, we admitted that we should have been even more defensive in the second half than we were. Nevertheless, the level of caution we did advocate kept subscribers even when most others were WAY under water, and gave us the 11th best performance for the year.
Through June of this year, our average recommended portfolio is up 18.6% year-to-date, handily beating the market averages. More important, our 5-year record (also through the end of June) is one we are even more proud of! For the last five years, our recommended holdings have posted gains of 13.3% per year. It is important to remember that most of this time, the markets were weak; indeed, most major market indices, cumulatively, were lower at the end of June than they were 5 years previously.
Our 5-year performance is the THIRD BEST of the 140 newsletters covered by Mark Hulbert for the period. From our perspective, it shows that a slow and steady approach wins the race. Sure, we’ve hit our share of “home runs.” And we’ll be the first to tell you that—in the current rebound—there are many publications and advisers who are throwing caution to the wind, and logging greater short-term returns as a result. The trouble is, they usually give much of those gains back once things turn sour. Historically, we most often have not.
I invite you—if you’re a visitor to the site—to look around. If I may suggest, take the time to read my August, 2004 Special Report entitled “Understanding the Game.” It best describes the financial world in which we live, and teaches critical truths you generally will find nowhere else (and, if I may be a bit immodest, it was quite prophetic, as things turned out!) It will also give you an idea of how we approach things here at The National Investor; a look into our mindset, so you know what you are in store for once you become a subscriber!
Feel free to write me with your questions and comments at chris@nationalinvestor.com.
Sincerely,
Chris Temple, Editor
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