Hot List Newsletter

Most Recent Hot List Issues

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

12/31/2015

Validea Hot List

The "Magic" Behind Greenblatt's Winning Formula

In theory, a winning investment strategy is a bit like a beautiful, secluded tropical island: Don't let too many people know about it, or else it will be ruined. Well, a decade ago, Joel Greenblatt told the world about a highly successful strategy that, until then, had been the equivalent of a beautiful, secluded tropical island. And guess what? Investment "tourists" have yet to ruin it. In this week's newsletter, we take a look at Greenblatt's "Magic Formula", and examine why the strategy -- and the strategies of other investment greats -- continue to work long after academic theories say they should.

12/18/2015

Validea Hot List

Believing In Value

While history has shown that smaller stocks tend to beat their larger peers by a significant margin over the long haul, we've seen a divergence from that trend over the past couple years. So, are value stocks dead? We find that notion very unlikely. That's because we don't think the historical outperformance of value stocks is due to circumstance or coincidence. Value stocks have outperformed because of human nature and the very nature of business itself.

12/4/2015

Validea Hot List

A Look at Martin Zweig's "Super" Market Timing Strategy

In this issue, we look at the timing system developed by the late, great Martin Zweig, one of the gurus upon whom I base my strategies. Zweig developed a number of timing tools that he used to determine how invested he would be in the market at any given time. Included in his "Monetary Model" are factors like the discount rate, the prime rate and installment debt.

11/20/2015

Validea Hot List

A Quant's Journey: The Mental Lessons

After 12 years of running my guru-inspired investment models, I've learned a number of lessons about the mental approach needed to succeed with quantitative strategies. Read this week's newsletter to see what the greatest of those lessons are.

11/6/2015

Validea Hot List

Juggernaut Stock Selection Strategies for the Long-Term

In this week's Validea Hot List, we provide an update on the current Hot List portfolio and also outline the research conducted by James O'Shaughnessy in the various editions of his book, "What Works on Wall Street". The combination of value investing and momentum outlined in the book is a very powerful way to select stocks and we highlight the studies from O'Shaughnessy to support this.

10/23/2015

Validea Hot List

A Quant's Journey - 4 Key Lessons I've Learned Over 10+ Years of Following Systematic Strategies

It has now been more than 12 years since I started running my quantitative guru-inspired investment strategies. Read this week's newsletter to see what the greatest lessons I've learned along the way are. Plus, the Validea Hot List is being rebalanced and four new stocks are being added to the portfolio

10/9/2015

Validea Hot List

Spotlighting One of the Greatest Fund Managers of All-Time: Peter Lynch and His Strategy

In this issue of the Validea Hot List, we highlight Peter Lynch and his exceptional performance track record while at the helm of the Fidelity Magellan Fund. We outline our Lynch-based model and include the top 10 scoring stocks that meet the Growth At A Reasonable Price (GARP) investment criteria based on his book, "One Up on Wall Street". Also, we provide an update on the Validea Hot List portfolio, which has clawed its way back into the black for the year.

9/25/2015

Validea Hot List

How Many Stocks Is Enough? The Long Term Risk & Return Data Behind Our 10 & 20 Stock Portfolios.

In this issue of the Validea Hot List we take a deep look at the pros and cons of running a highly concentrated stock portfolio, and why using a fundamental ranking system, like the Validea investing approach, can help give focused portfolios, such as the Validea Hot List, a strong performance advantage over time. Also, the Validea Hot List portfolio is being rebalanced and a few new names, including the retailer Zumiez, are being added to the buy list.

9/11/2015

Validea Hot List

Spotlighting Benjamin Graham and Great Value Investors

In this issue of the Validea Hot List, we provide an update on the US economy and our performance, and review some recent strong performers in the portfolio. Also included is a highlight on our Ben Graham deep value model and how great value investors use fundamentals, discipline and a long-term investment horizon to give themselves the best chance to beat the market.

8/28/2015

Validea Hot List

The Hidden Downside of Investing in Market Cap Weighted Indices

In this issue, we explore how market-cap weighted indices are constructed and the risks associated with them and why strategies that select stocks based on fundamentals offer a viable long term alternative to disciplined investors. Also, the Validea Hot List portfolio is being rebalanced and we are adding a handful of new names, including a two firms in the insurance sector and two new small cap bank names.

8/14/2015

Validea Hot List

Sticking to the Fundamentals - like that of John Neff and other Gurus - is Key to Long Term Success

The market - and the Hot List - have encountered some turbulence recently. Read this week's newsletter to see how we're handling the bumps in the road. Also included in this issue is an overview of John Neff's investing approach, which includes independent thinking and a fundamental-focus when selecting stocks and the investing for the long run.

7/31/2015

Validea Hot List

Beyond Value -- How Momentum can Peacefully Co-exist with Value Investing

In this issue, we look at various fundamental-based strategies that use a combination of value and momentum factors. Also, the Hot List portfolio, which is having a solid year performance wise, is being rebalanced and four new names are coming into the portfolio, including a small-cap community bank with nice fundamentals.

7/17/2015

Validea Hot List

Buying Selling and Buffett -- How a Systematic Sell Discipline Can Improve Your Returns

How do you know when it's time to sell a stock? In this week's newsletter, we tackle that question by looking at how Validea's Warren Buffett inspired strategy has fared using different buy/sell frequencies - and the results may surprise you. Also included is an overview of the current economic back drop and how the Hot List portfolio is faring so far in 2015.

7/2/2015

Validea Hot List

New Gains and New Names for the Validea Hot List

Still well ahead of the market in 2015, the Hot List is adding three new holdings on today's rebalancing. Also in this issue is a review of the market's overall valuation using the Shiller P/E, Tobin's Q, the market's Price-to-Sales ratio, and other metrics.

6/19/2015

Validea Hot List

A Look at David Dreman's Contrarian Philosophy and Investment Approach

In this issue we look at David Dreman's investment philosophy and approach as outlined in his timeless book, "Contrarian Investment Strategies". Also, in this issue you'll find an update on the Validea The Hot List portfolio, which has been flying high in 2015. Find out which holdings have been driving the portfolio's recent performance in this week's newsletter.

6/2/2015

Validea Hot List

The Rate Hikes Are Coming, The Rate Hikes Are Coming! (Some Day. Honest )

A historical look at the impact of rising interest rates on the stock market. Also, the Hot List continues its strong performance this year and four new stocks are coming into the portfolio, including an energy name, a semi-conductor company and a beaten down flooring firm that looks troubled, but could be a great long-term opportunity.

5/22/2015

Validea Hot List

A Closer Look Joel Greenblatt's Magic Formula Value Investing Model and Its Top 10 Ideas Right Now

Amid mixed economic data, the Hot List has been trying to build on its strong 2015 performance. Read this week's newsletter to see which of its holdings are leading the way. Plus, Greenblatt's Magic Formula model is discussed and this issue features the top ten scoring value stock ideas that score highest according to the model.

5/8/2015

Validea Hot List

Battling Your Investment Biases and Improving Your Long-Term Returns

The Hot List is continuing to have a strong year, but it is always important to have a plan for when times get tough. Read this week's newsletter to see how the portfolio is designed to eliminate the behavioral biases that can wreak havoc during market turmoil. Also, the Hot List is rebalanced today and there are four new positions, mostly in the small-cap arena, being introduced to the portfolio.

4/24/2015

Validea Hot List

Markets Working Through the Adjustment Period

The broader stock market's gains have been tepid as the economy adjusts to a low-oil-price world, but the Hot List remains well ahead of its benchmark in 2015. Read this week's newsletter to see which holdings are leading the way. Plus, the Ken Fisher Super Stock model is in the Guru Spotlight this week.

4/10/2015

Validea Hot List

The Case For Guru Strategies -- How and Why these Investment Models Still Work in Today's Market

The stock market and economy have gone through many changes over the past few decades. Read this week's newsletter to find out why old strategies still work in the new financial world. Plus, the Hot List portfolio, which is having an excellent year so far in 2015, is undergoing its monthly re-balancing and two new fundamentally sound stocks are being added to the portfolio today.

3/27/2015

Validea Hot List

10 Slow Growing, High-Dividend Lynch-Based Model Picks

In this issue of the Validea Hot List, we highlight another way to utilize our stock screening models by providing a sampling of stocks that pass the Lynch based model, have dividend yields of at least 3.5%, and have five year annualized growth rates under 10%. The Hot List portfolio is also in the spotlight given the very good performance so far in 2015 and over the long-term.

3/13/2015

Validea Hot List

Investing Lessons from The Oracle of Omaha's Annual Letter to Shareholders

Warren Buffett recently released his annual letter to shareholders. Read this week's newsletter to see what lessons investors can take from Buffetts latest missive. Plus, the Validea Hot List is rebalanced and we have four new stocks coming into the portfolio.

2/27/2015

Validea Hot List

Quantitative Value and Growth Guru Strategies On The Rebound

The Hot List is continuing its strong bounce-back in 2015. See which holdings are leading the way in this week's newsletter. Also, we highlight the Martin Zweig growth investor model, which is based on Zweig's book Winning on Wall Street. During the 15 years that it was monitored, Zweig's stock recommendation newsletter returned an average of 15.9 percent per year, during which time it was ranked number one based on risk-adjusted returns by Hulbert Financial Digest.

2/13/2015

Validea Hot List

Looking at the Markets Valuation Using Multiple Fundamental Factors

In this issue of the Validea Hot List, the market's valuation is looked at using a number of factors, including the P/E, P/S, Shiller P/E, Stock Market/GDP ratio and Q Ratio. Also, after a strong start to 2015 the Hot List Portfolio is adding five new holdings, including one of the biggest names in the market that is favored by the Peter Lynch and Warren Buffett factor based models.

1/30/2015

Validea Hot List

Hot List Portfolio Bouncing Back in Early 2015

A month into the new year, the Hot List is bouncing back strong from a disappointing 2014. See which holdings are leading the way in this week's newsletter. Also included are other strong performing model portfolios. Our Consumer Non Cyclical Portfolio is highlighted as well as the strategy based on James O Shaughnessy's long-term research and studies.

1/16/2015

Validea Hot List

Reasons to Stay Optimistic in 2015 and over the Long-Term

As 2015 begins, there are a number of reasons to be optimistic about how our guru inspired portfolios are positioned. Read this week's newsletter to find out what those reasons are. Plus, the Hot List portfolio is having its first rebalancing of the year and three fundamentally sound stocks are being added to the portfolio today.

1/2/2015

Validea Hot List

U.S. Economy And Markets Finish 2014 On A High Note

The U.S. economy ended 2014 on a high note. Read this week's newsletter to see how the Hot Lists holdings are faring amid the economic improvement. Plus, the Peter Lynch investing model is featured along with 10 top stock ideas according to the Lynch inspired strategy.
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.