Hot List Newsletter

Most Recent Hot List Issues

3 most recent issues require subscription. Historical issues can be viewed free of charge.

12/24/2010

Validea Hot List

Are you Invested with a Closet Indexer?

Closet indexing has been on the rise and investors are better served, over the long run, looking for stock selection strategies that look different than most major indices. Validea's models offer a refreshing alternative for those looking for differentiation in today's hyper competitve stock market.

12/10/2010

Validea Hot List

What a Difference a Year Makes

As we head into the home stretch of 2010, the mood on Wall Street and Main Street seems to be one of trepidation, mixed with a touch of very cautious optimism. A deeper look at where we stand using key economic facts and figures.

11/26/2010

Validea Hot List

Looking Past the Fear With a Focus on Fundamentals

Market participants could be too negative and fearful, a result of the emotional overhang from the financial crisis. According to one expert, we could be entering the second phase of the bull market, which will be a period where growth is rewarded by investors.

11/12/2010

Validea Hot List

Please Hold The Market Talk Froth, For Now

The broader market picture looks far from frothy, particularly when it comes to U.S. stocks. Despite the fact that many high-quality U.S. stocks are trading at very attractive values -- and the fact that bond prices are very high and yields are very low -- investors are continuing to dump more cash into the perceived safety of bonds.

10/29/2010

Validea Hot List

The Fed's Decision -- To Ease Or Not To Ease

The Fed's decision to embark on quantitative easing could be signifcant for the markets. In this issue, we look at what QE2 could mean for stocks and the economy.

10/15/2010

Validea Hot List

It's Not (Just) The Economy, Stupid

In today's world of instant information, it can be easy to get caught up in the reems of economic data that investors are deluged with every day. But as you wade through the ocean of economic figures, it's important not to lose sight of a key broader point: The stock market is not the economy. Learn why in this Hot List issue.

10/1/2010

Validea Hot List

A Portfolio of All Shapes and Sizes

Investors can find values in companies of all sizes (small, mid and large) and in both value and growth companies. The key, as we outline in this issue, to find stocks that meet certain fundamentals and not be restrict your investable universe.

9/17/2010

Validea Hot List

Investing During Periods of Discipline Amid Turmoil

Staying disciplined through difficult and volatile times is, in fact, something that the majority of the gurus who inspired our strategies at Validea talked about extensively. Here we review the lessons from Buffett, Lynch and other great investors.

9/3/2010

Validea Hot List

All Bull Markets Come with Corrections

In this issue, we review how past bull markets have developed, to see what has happened historically after a bull run first hits trouble (as it has recently). To do so, we examined four bull markets (using the S&P 500) that cross a wide span: those that started in 1957, 1974, 1982, and 2002.

8/20/2010

Validea Hot List

The 800 lb Gorilla - Unemployment

In our continued look at different levels of our economy, today we look at where we stand with unemployment and where today's figures compare to past economic recoveries.

8/6/2010

Validea Hot List

Fears of a "Double-Dip" Recession Pick Up

The recovery has slowed in the past couple months, and there are still very legitimate concerns about the economy. But before you get caught up in the headlines announcing the slowing GDP and manufacturing growth, we point out a few key economic facts. Read this issue to learn more.

7/23/2010

Validea Hot List

The Seven-Year Report Card of Validea's Guru Investing System

In this newsletter, we report on the performance of our guru models and our consensus portfolios. It's been a profitable seven years, and while the 2008 Bear Market was tough, our strategies have bounced back nicely.

7/9/2010

Validea Hot List

Adding a Diverse Quartet of New Names

The Hot List is shaking things up today on its regular monthly rebalancing, selling four of its holdings and replacing them with four that are now garnering higher scores on my guru-based models. The newcomers to the portfolio are quite a mix.

6/25/2010

Validea Hot List

Get Your Head Out of the Game

Predictions, emotions and lack of discipline are all factors that impact our investing returns, but by understanding the limitations we have as humans, you can utilize systems and models to put the odds in your favor when investing. Read this issue to find out more.

6/11/2010

Validea Hot List

Thinking Outside the Style Box

In the dozen or so years spent studying history's most successful investment strategies, we've found that paying too much attention to such style-box distinctions (i.e. large cap value, mid-cap growth) can be harmful to your returns. Here are the reasons why and what you should be aware of.

5/14/2010

Validea Hot List

What Makes Stocks Tick

What drives stock prices over time? The four key factors are 1) inflation 2) dividend income 3) real book value growth and 4) price-to-book growth. We discuss each of these and the biggest factor might surprise you.

4/30/2010

Validea Hot List

The Gloomy Bull Market Marches On

Stocks are up close to 80% off their March 2009 lows, the economy is showing clear signs of recovery, and companies are posting strong earnings and in many cases sporting solid balance sheets. But you probably wouldn't know it if you listen to the financial news or read what the pundits have to say.

4/16/2010

Validea Hot List

The Benefits of Blending Various Value and Growth Investment Strategies

The combining of value and growth investment strategies, like we do with the Hot List or Top Five Guru models, provides a level of strategy diverisification that is worth discussing. Learn more in this Hot List edition.

4/2/2010

Validea Hot List

Stocks the Best Game in Town

Stocks are looking to be the best alternative for decent returns according to many, including PIMCO's Bill Gross.

3/19/2010

Validea Hot List

A (Re-)Balancing Act

In this issue, we discuss the importance of having a disciplined portfolio rebalancing methodology that looks to sell and buy stocks at predetermined intervals based on factors that have changed.

3/5/2010

Validea Hot List

Old Principles, New Features via Validea Professional

We walk investors through our Validea Professional service - a new add-on for investors looking to further leverage our guru-based models through high conviction trade alerts, country and sector portfolios and guru stock reports.

2/19/2010

Validea Hot List

Are we Really Doomed by Debt?

All the talk of the US fiscal health has us looking back at other periods of time where the country ran up high deficits and how the stock market performed during and after those periods. Equities have and will still offer long term investors an opportunity for solid returns despite all the talk of too much debt.

2/5/2010

Validea Hot List

Finding Profits in the "Lost Decade"

While the 2000s was likely a lost decade for investors who plopped money into broader U.S. market index funds, they weren't lost for others. If you had a simple, sensible, disciplined approach, you could have kept your portfolio in the black; you might even have generated some big gains.

1/22/2010

Validea Hot List

Study: What Works At this Stage in the Market Cycle

James O'Shaughnessy, one of the investors who we admire and respect (and one of our gurus), and his firm recently published a research paper outlining what types of stocks performed best, typically, at various Bull Market stages. The conclusion: we will likely start to see a shift toward superior performance from higher quality stocks.

1/8/2010

Validea Hot List

Five Reasons for Optimism in 2010

While we shy away from making macro calls, we do like to look at the facts and give our readers a sense of how we are feeling and why we may be more (vs. less) optimistic on equities in the short to mid term. Here are five reasons why we are constructive on stocks right now.
Performance Disclaimer: Returns presented on Validea.com are model returns and do not represent actual trading. As a result, they do not incorporate any commissions or other trading costs or fees. Model portfolios with inception dates on or after 12/30/2005 include a combination of back tested and live model returns. The back-tested performance results shown are hypothetical and are not the result of real-time management of actual accounts. The back-testing of performance differs from actual account performance because the investment strategy may be adjusted at any time, for any reason and can continue to be changed until desired or better performance results are achieved. Back-tested returns are presented to provide general information regarding how the underlying strategy behind the portfolio performed in our historical testing. A back-tested strategy has the benefit of hindsight and the results do not reflect the impact that material economic or market factors may have had on advisor's decision-making if actual client assets were being managed using this approach. The model portfolios offered on Validea are concentrated and as a result they will exhibit high levels of volatility and their performance can be substantially impacted by the performance of individual positions.

Optimal portfolios presented on Validea.com represent the rebalancing period that has led to the best historical performance for each of our equity models. Each optimal portfolio was determined after the fact with performance information that was not available at portfolio inception. As a result, an investor could not have invested in the optimal portfolio since its inception. Optimal portfolios are presented to allow investors to quickly determine the portfolio size and rebalancing period that has performed best for each of our models in our historical testing.

Both the model portfolio and benchmark returns presented for all equity portfolios on Validea.com are not inclusive of dividends. Returns for our ETF portfolios and trend following system, and the benchmarks they are compared to, are inclusive of dividends. The S&P 500 is presented as a benchmark because it is the most widely followed benchmark of the overall US market and is most often used by investors for return comparison purposes. As with any investment strategy, there is potential for profit as well as the possibility of loss and investors may incur a loss despite a past history of gains. Past performance does not guarantee future results. Results will vary with economic and market conditions.

Validea.com is a research provider that is owned and operated by The Reese Group, LLC. Validea.com offers model portfolios, screening and stock analysis that is not customized to any individual. No information on Validea.com should be construed as investment advice. Validea Capital Management is a separate investment advisory firm registered with the state of Connecticut. Validea Capital offers investment management services directly to clients and is a separate entity from The Reese Group, LLC. The Reese Group and Validea Capital are affiliated entities and share partial common ownership.