Closing the Book on Another Report Card

Closing the book on another Report Card... The rest of the grades are in... Which service received a coveted 'A++' this year?... Gold, silver, and options...

It's time to wrap up our annual review...

Two weeks ago, we kicked off this year's Report Card with a look at The Capital Portfolio and the eight traditional publications that correspond with that Stansberry Portfolio Solutions core product.

Then, in last Friday's Digest, I (Brett Aitken) graded The Income Portfolio, The Total Portfolio, and eight other services. Now, I'm ready to hand out my grades for everything else...

Today, we'll cover the final eight publications under our publishing umbrella. I'll grade The Defensive Portfolio, American Moonshots, Stansberry's Big Trade, Gold Stock Analyst, Silver Stock Analyst, Retirement Trader, Advanced Options, and Ten Stock Trader.

Before we go any further, please note that I won't be grading Stansberry's Forever Portfolio, Stansberry's Election 2020 Portfolio, or True Wealth Real Estate this year. That's because we launched all three of these services within the past year... So we consider them too young to have any meaningful track record for this year's grading period.

As I've explained the past two weeks, you should start by reading the "Our Grading Criteria" box in the February 5 Digest. And after you've done that, check out the rest of the grades...

The Defensive Portfolio: A

We launched The Defensive Portfolio in May 2019. So this product's track record is much shorter than most of the other publications that we're grading this year...

As I've noted, this year's Report Card is based on the performance of our services over the past five years. Meanwhile, The Defensive Portfolio's track record is just 18 months long.

Still, in such a short span, it has certainly been tested for its main purpose...

Our goal with this portfolio – which falls under our Stansberry Portfolio Solutions coverage – is to help you prepare before a big correction hits. It's about playing defense.

Some of the strategies implemented in The Defensive Portfolio will help protect your assets in a massive market decline... and some are even designed to profit when that happens. And finally, portfolio manager Austin Root and his team seek to deploy one critical strategy with this product once we're well into the depths of a bear market – bargain hunting.

The Defensive Portfolio is a diversified, fully allocated portfolio of about 20 to 25 names, with positions in gold and cash... blue-chip "forever stocks"... "uncorrelated gems"... "anti-fragile" stocks... and some short positions as "portfolio insurance."

It's conservative in nature, designed mostly to help folks stay wealthy... That's different from The Capital Portfolio, which is intended to help subscribers get wealthy.

And as COVID-19 tested investors last spring, this defensive-minded strategy paid off...

In the throes of the March crash, Austin held two short positions in The Defensive Portfolio –struggling fashion retailer Nordstrom (JWN) and debt-laden car-rental company Hertz Global (HTZ).

As the overall market dropped 34% from February into March, Nordstrom fell more than 60% over a similar span... and Hertz plummeted more than 80%. Of course, regular readers know that short positions benefit when stocks go down. And that's what happened in this case...

Austin's short positions in Nordstrom and Hertz stopped out once the market rebounded off its lows. But they worked as designed... He booked 48% and 59% gains, respectively.

I mentioned this last week in our review of The Total Portfolio, but it's worth saying again... Having even a small part of your portfolio in a short position or two can help offset some of the losses that you'll experience on the long portion of your portfolio during a market crash.

Unfortunately, some of the long positions suffered along with the rest of the market last spring... Overall, this portfolio declined during the crash last February and March. And I know Austin was disappointed with that result. As he explained to subscribers of The Defensive Portfolio in January...

[The Defensive Portfolio] also had another solid year in 2020 when all was said and done. However, it did not perform as well as I'd hoped in the teeth of the market sell-off in March.

But importantly, it declined far less than the overall market did over the same span. Austin noted that this portfolio outperformed the S&P 500 Index by more than 14 percentage points (1,400 basis points).

It's also worth noting that Austin handles stops a little differently in this portfolio...

He takes a more dynamic approach that provides flexibility with stocks that you want to hold for the long term – maybe because of the quality of the business, the growth potential, or the yield. So when these stocks sell off with the broader market, you're not whipsawed out of as many positions that you want to hold for the long haul.

Overall, The Defensive Portfolio produced a 27.2% total return from its inception in May 2019 through December 2020. It beat the benchmark by several percentage points. With this performance, it earns an "A" for this year's Report Card.

American Moonshots: A++

I don't recall seeing anything like it...

As a grader, I consider myself pretty tough. It takes something special to get an "A++."

Well, Austin has done "something special" with American Moonshots since its inception at the start of 2019. And with the 2020 version of this portfolio, he produced a colossal 115.6% portfolio gain... Yes, you read that right – a 115.6% return across the entire portfolio.

The concept behind this portfolio is relatively simple to understand...

Austin works with our team of more than 30 analysts to scan across everything we publish – and more. They have one objective... Find tiny stocks with "moonshot" potential.

This is an allocated portfolio approach... It isn't a list of regular monthly recommendations like our traditional publications. Austin starts each year with a dozen or so stocks – across a variety of sectors, including technology, health care, and traditional operating businesses.

As with any speculative portfolio, we expect some of the companies will be bought out – hopefully at a premium to our entry price... some won't work out as anticipated... and others will absolutely soar. And that's exactly what happened in 2020...

The entire American Moonshots portfolio returned 26% in 2019. That's a solid gain for a full year... But the 2020 version blew past that by more than four times.

Out of respect to Austin's paying subscribers, I can't give away any stock names here. One tip, though... You can keep an eye our "Top 10 Open Recommendations" table at the bottom of each day's Digest for some of his biggest winners over the past couple of years.

Just know that Austin had 13 positions in this portfolio at the end of 2020... Five stocks were showing triple-digit gains in a single year, including a 371% profit in a small but profitable and growing bank. Of the remaining positions, another five were up double-digit percentages in 2020, two were up single digits, and one showed a tiny 6% loss.

As I said, I don't recall ever seeing anything like this portfolio's performance. Having an entire portfolio soar 115.6% in a single year is simply unheard of.

From inception through the end of 2020, American Moonshots had a total return of 171.7%. That blew away its benchmark (the S&P SmallCap 600 Index), which returned just 44.9%.

These are extraordinary results...

I'm incredibly proud of what Austin has achieved with American Moonshots so far. And I'm delighted to award the publication with the only "A++" grade in this year's Report Card.

Stansberry's Big Trade: B

This is one of the most controversial – and least understood – services that we publish...

It's not for everyone. It's definitely not for faint-hearted investors. Plus, this is a bearish strategy. And it's volatile... really volatile.

Here's what I said in last year's Report Card, which we published on January 31, 2020...

We expect this Big Trade strategy to excel when volatility strikes again. And trust me, it will happen. We just don't know when... how hard it will hit... and for how long it will last.

Obviously, I didn't know the COVID-19 crash lurked just around the corner... or how severe it would prove to be. But as Stansberry's Big Trade subscribers discovered in 2020, the strategy that editor Bill McGilton uses in this publication did exactly what it's designed to do...

Excel when the market tanks.

Before I get to some of the details, please let me first reiterate something important...

If you use this strategy, you absolutely must diversify among Bill's recommendations. You also need to have conviction in your ideas, discipline not to "bet the farm" (despite the temptation for huge gains, only allocate tiny amounts of capital), and most of all...

You must exercise patience.

No one practiced these traits – with this strategy – better than commodity trader Everett Klipp... If you're unfamiliar with Klipp, you should know that he was sometimes called the "Babe Ruth" of the Chicago Board of Trade.

Klipp spent a 50-year career selling commodity futures, like soybeans and corn. He built one of the largest local firms – called Alpha Futures – in 1978 and ran it until he sold in 1994.

Hedge-fund manager and author Mark Spitznagel, who spoke at our Stansberry Conference several years ago, discussed Klipp's approach in his 2013 book The Dao of Capital: Austrian Investing in a Distorted World...

As Spitznagel explained, Klipp showed his young students how people are naturally impatient... and refuse to take losses. So he taught them how to be patient... and how to manage losses.

Obviously, Klipp didn't want to take any losses. But he knew he could withstand them – a lot of them – if he kept the losses small. That way he could stand to fight another day... The big wins would more than make up for the many small losses he took along the way.

Spitznagel now runs a multibillion-dollar hedge fund. And part of his success came from making Klipp-like bets... similar to the kind that Bill makes in Stansberry's Big Trade.

We launched this publication in October 2016... With trillions of dollars in car loans, student debt, credit cards, and corporate debt – most of which was just one notch above "junk" credit – we believed the credit cycle was about to roll over.

As I mentioned last week, that hasn't happened... not yet at least. But it will at some point.

In the meantime, Bill scans the markets for companies that have broken business models... are bloated with debt... or both. He then makes small, asymmetrical bets – using put options – that their stocks will fall... As that happens, the premiums for the puts will soar.

Given that the market has been in a roaring uptrend for more than a decade, it has been tough to successfully execute this publication's core strategy. Let's face it... A rising tide can lift even some of the world's leakiest boats – at least for a while.

But last spring, all the patience prevailed for Bill and his loyal followers... We experienced the fastest and most severe crash in recent history. And as I wrote in Part I of the annual Report Card a couple of weeks ago...

Over just a few weeks in March and April, Big Trade editor Bill McGilton closed a series of triple-digit winners – including a 228% gain on cruise line Royal Caribbean (RCL), a 152% gain on carmaker Ford Motor (F), and a 140% gain on financial giant Ally Financial (ALLY).

Putting just a small amount of money in those ideas could have saved your portfolio.

Then, as Bill booked this series of huge wins with his put-buying approach during the 2020 crash, he knew selling had hit an extreme level. More important, this extreme meant the put options were now trading at ludicrously high prices.

So Bill pivoted... and started selling puts on some of the world's highest-quality names.

He recommended selling options on companies whose share prices were selling at multiples lower than they had in years, like beverage giant Coca-Cola (KO) and chocolate maker Hershey (HSY). This sell-off – and subsequent rise in volatility – also meant the put options for these companies were trading at higher premiums than they had seen in years.

If there's such a thing as "free money" in the market... this was it. And Bill didn't hesitate... Overall, he put on seven trades using this strategy. And in the end, he booked double-digit gains on all seven for a 100% win rate and nearly 50% average gains.

I was thrilled to see Bill adapt to the changing market at the time... He showed his subscribers how to take advantage of an opportunity that doesn't come along every day.

Stansberry's Big Trade hasn't been around for the full five-year grading period of our 2020 Report Card. However, its track record of more than four years is still meaningful...

And on the surface, its 47% win rate and 2.6% average annualized gain might not catch your eyes. But remember... This is portfolio insurance.

I don't know any other insurance policy that pays you a small premium to hold it. So squeaking out a small gain is a win for this bearish strategy – especially during a four-year period when the overall stock market has ripped higher.

By comparison, if you were simply holding the benchmark – the ProShares Short S&P500 Fund (SH) – as portfolio insurance, you would've lost 15.5% over the same holding periods (17.9% annualized).

These results earn Bill and Stansberry's Big Trade a "B" for this year's Report Card.

Gold Stock Analyst: A

John Doody officially joined Stansberry Research in the summer of 2019. But his experience extends much longer than that... He has penned this publication for more than two decades.

And after working alongside his analyst Garrett Goggin for many years, John has built an incredible data and knowledge base to track all the notable gold mines around the world. He uses his own proprietary methodology to evaluate what a precious metals business is worth... and then identifies the right time for his subscribers to get into its stock.

John knows everyone in the precious metals industry. And he has developed a great reputation across the sector thanks to his thorough, credible, and trustworthy research.

Naturally, we're thrilled that John and Garrett have joined the Stansberry Research family. And as you can see, the results for Gold Stock Analyst speak for themselves...

From 2001 through 2020, John racked up an incredible 1,239.7% cumulative gain – 24.1% average annual gains for 20 years. Those returns crushed both gold and regular stocks...

If you instead would've placed your hard-earned cash into the S&P 500 back in 2001, you would've made 322.2% over that span – or 9.1% average annual gains. And it's a similar story if you would've just bought physical gold... Your holdings would've gained 585.6% (11.2% average annual return).

That would be an incredible feat for any analyst selecting across many industry sectors... And John did it by holding no more than 10 gold stocks at any given time. It's what he calls the "GSA Top 10" – the best of the best. And he doesn't let just any company in...

For example, in early 2020, John held just nine gold stocks in his portfolio for a few months after selling one of his positions in January. Rather than fill the spot with a "next in line" approach, John simply held the cash while he did his due diligence to find a suitable replacement.

Then, after a few months, he finally filled the spot in May. And his patient approach paid off... This gold stock was up roughly 60% by the end of the year. Meanwhile, gold mostly traded sideways from May through December... It was up just 11% over the same period.

This example demonstrates the benefits of having an expert like John as your guide – especially in the volatile precious metals sector.

Over the five-year grading period in our 2020 Report Card, John's GSA Top 10 produced a total return of 185.3%. And his average annual return of 25.8% beat the 23.9% average annual return of the VanEck Vectors Gold Miners Fund (GDX) over the same holding period.

That earns John an "A" for this year's Report Card.

Silver Stock Analyst: A+

This publication is like Gold Stock Analyst on steroids...

Similar to what John and Garrett do with the GSA Top 10, they hold no more than five silver stocks at any given time. This is silver's best of the best... It's called the "Fave 5."

Every month, Garrett provides the latest insights on the silver industry – including raw data on the miners, prices, and market indicators. I doubt you'll find more thorough research on the industry anywhere else on the planet. And like John does with the GSA Top 10, Garrett applies a proprietary methodology to figure out how much to pay for these silver stocks.

Remember, both the GSA Top 10 and Silver Stock Analyst's Fave 5 are designed as fully allocated portfolios... They aren't just recommendation lists like our traditional publications.

And just like the GSA Top 10, the Fave 5 is producing some truly outstanding results...

Over the past five years, this portfolio has produced a total return of 401.3%. And the average annual return is 45.2% over that span. Meanwhile, the benchmark for this publication – the Philadelphia Gold and Silver Index – returned 218.3% over the same period. And its average annual return equaled 30.3%.

So Silver Stock Analyst subscribers who followed all the advice from John and Garrett in the Fave 5 would've made almost double the return of the benchmark. And with silver up just 89% in that span, they would've made more than four times the precious metal's gains with the Fave 5.

These are extraordinary results... And just as Silver Stock Analyst did in its inaugural Stansberry Research Report Card a year ago, it earns an "A+" once again.

Retirement Trader: B

This is where a successful career on Wall Street really pays off...

Longtime Digest readers know that Dr. David "Doc" Eifrig spent more than a decade working for major institutions like Chase Manhattan and Goldman Sachs before he retired... for the first time.

Sick of the greed and hypocrisy of Wall Street, Doc then turned his attention to the medical profession... and became a board-eligible eye surgeon. He eventually retired again and joined us at Stansberry Research.

In short, Doc has one of the most interesting – and successful – careers of anyone I know. He brings a wealth of worldliness and experience to our team and adds tremendous value for our subscribers. Among his biggest achievements is the success of this publication...

The 94% win rate since Doc launched Retirement Trader in 2010 "almost" tells it all. I don't believe you will find another research service on the planet offering consistent winning results like that in the options market.

So how does he do it?

Well, a lot of people buy options because they provide leverage... meaning you can get more bang for your buck. But it's like a double-edged sword due to the elevated risk...

Most inexperienced traders put far too much money into a single trade because they only see the potential gain – not the potential downside, which is losing it all... and fast. Options will burn you if used incorrectly.

Doc flips this thinking around... He sells them. And he only uses this strategy on companies that he knows, understands, and believes come with a high margin of safety for success.

Doc then places a small bet that the stock will not trade below a certain threshold within a limited time frame... Each of his recommendations lasts a few months, on average.

These are not "home run" triple-digit winners that you might see in other trading services. They're smaller single- and double-digit winners. And over the long run, this strategy proves to be much safer than many others... as you can see with his win rate.

Doc hits one single after another... And over the course of a year or two, these gains really start to add up. It's a brilliant way to earn safe, steady income for retirees – or anyone.

And it works in any market... Even when stocks sold off last spring, Doc and his team identified plenty of moneymaking opportunities.

For example, last March, Doc recommended a trade on iPhone maker Apple (AAPL). He held the position for just 46 days... booking a 3.6% gain on capital at risk (or roughly 17% on margin).

Again, that might not sound like much when you see huge, triple-digit gains in other places... However, when Doc says "capital at risk," he's not just looking at the prices of the options, but the cost of having those options exercised.

In other words, if his recommendation brings in $100 for selling a put that comes with the obligation to potentially buy $10,000 worth of stock... he counts that as a conservative 1% gain. Most options traders calculate their gains only on the prices of the options.

Also, this strategy is so repeatable that Doc finds new trades for his subscribers every couple of weeks. And keep in mind that these trades only last a couple of months in general... So the annualized return on that trade with Apple, for example, was roughly 29% on capital at risk.

Throughout 2020, Doc made similarly successful trades on big-box retailer Walmart (WMT), credit-card giant American Express (AXP), Coca-Cola, and several other high-quality companies.

Over the five-year grading period for this year's Report Card, the average gain in Retirement Trader was just 1.2% – which trailed its benchmark. Doc only holds these positions for around 109 days, on average... So his average annualized gain was 4.6%.

The good thing is... because his win rate is so high, this really is a "rinse and repeat" strategy.

Doc recommended 257 trades over the past five years. He had 241 winners in this grading period – a 94% win rate. That's an impressive win rate... But to hand out a higher grade, I need to see higher average and annualized gains.

As a result, Retirement Trader earns a "B" in this year's Report Card.

When people tell me that trading options is too risky, I point them toward Doc's Retirement Trader. And the same goes for anyone reading this Report Card right now... If earning steady flows of income with low risk appeals to you, I'd encourage you to give it a try.

Advanced Options: A

Although Advanced Options is another options-focused publication, Doc and his research team approach things in a much different way than they do with Retirement Trader...

First, they look at the recommendations in our macro-level publications – like our flagship Stansberry's Investment Advisory, Dr. Steve Sjuggerud's True Wealth, or Doc's own Retirement Millionaire. Then, they design an options trade to "juice" the expected returns on the stocks recommended within these publications.

Now, they don't trade every recommendation from every monthly issue of these publications... For starters, some recommendations don't have an available options trade. Other times, Doc and his team don't believe a suitable trade on the stock exists.

Plain and simple... they won't force a trade if there isn't one to be made. Doc is always looking for a margin of safety. If he can't find that with the stocks that our team of analysts recommends in those macro-level publications, he'll look elsewhere for an alternative trade.

This strategy is more speculative and more aggressive than Retirement Trader. Doc and his analysts go after bigger gains, but they also suffer more losing trades. The key, of course, is how you do in the long run... You want to make sure your winners outpace your losers.

Let me walk you through a recent example of the Advanced Options strategy at work...

In December, the research team of Stansberry's Investment Advisory recommended buying shares of productivity-software company Asana (ASAN). The Advanced Options team also believed that Asana was ripe for a quick rise... So in their next issue, they opened a "bull spread" on the stock.

With a bull spread, you buy a call option at one strike price and sell another call at a higher strike price – both with the same expiration date. The income you receive from the higher-priced option helps reduce the cost of the option you buy. What you pay out is the risk, and the potential value is the difference between the two strike prices.

In this case, Asana traded at around $28 per share when Doc said to buy a January 2021 $25 call and sell a January 2021 $30 call. The cost of the spread was around $2.40 at the time. That means a subscriber would be risking $2.40 with the potential to turn it into $5.

Within just 28 days, Asana's stock had climbed to more than $32 per share. As a result, the bull spread rose to $4.70. Regular shareholders would've earned about 14% in that span... But the bull spread returned 96% in less than a month.

Still, not every trade works out as expected... Doc's team suffered a few losses as the markets turned lower in late February 2020. But the above example gives you some insight into the types of trade they look for in Advanced Options – and how they can play out.

For this example, you would've only had to pay as little as $240 to open a position. So you can implement this strategy with a small amount of capital. That's a great guideline to follow when trading options – especially if you're just getting started... Regular readers know that for speculative strategies like these, we always recommend only using small amounts that you can afford to lose.

For the most part, Doc and his team have placed bull spread trades since they launched Advanced Options in December 2018. That makes sense, given the market's general rise over that span. But they also look for bearish opportunities with "bear spreads"... as well as "calendar spreads" – which are trades designed to make money when a stock stays flat.

Don't let any of the jargon scare you... Doc and his team have developed an entire workbook as well as educational videos to walk you through each of these strategies and more.

While Advanced Options doesn't have a full five-year track record, the two-year results are compelling. So we wanted to share them with you in this year's Report Card...

Since launching the publication, Doc and his team have closed 40 winning trades from a total of 61 positions... That works out to a 66% win rate. The average gain is 9.7% over an average holding period of about 47 days. That's an average annualized return of 76%.

That's remarkable... It's almost three times better than the 26.5% return of the S&P 500 over similar holding periods. And that earns Doc and his team an "A" for Advanced Options.

Ten Stock Trader: B

Editor Greg Diamond made some great calls in 2020...

Last year alone, he booked 28 winners from 41 trades (68% win rate). His average gain for the year – including winners and losers – equaled 23%.

That's impressive for any investment strategy... But it's even more impressive when you realize that he mostly focuses on finding short-term trades and uses options to leverage the idea. That's why he emphasizes small position sizes in every trade that he makes.

Like Everett Klipp, who I mentioned earlier, Greg understands that preservation of capital is critical to success... And he knows that you're going to take losses along the way.

So he takes a portfolio approach and only allocates small percentages to each trade – usually between 0.5% and 2.5%. And as he showed his loyal followers last year, the big triple-digit winners more than make up for the inevitable small losers along the way.

For example, let's look at the period from February 2020 through August 2020...

That time frame included the previous market high, the dramatic 34% sell-off in February and March, as well as the period until the market recovered and broke out to a new high.

Greg opened 30 trades during this stretch. He took a loss on six straight trades in March... But they were all tiny bets of just 0.5% position size.

Think about that... On a $100,000 portfolio, that's just $500 per trade. Everyone should be able to handle a few tiny losses like that without losing any sleep.

And then, Greg went on a tear... He produced 14 winners from 19 trades. And even better, six of these trades were triple-digit winners.

Now, just to be clear...

Greg is a technical trader. He trades around price action – not the fundamental analysis of the stock. And he doesn't marry himself to any of the stocks in his portfolio. He trades these stocks because he can identify specific characteristics that suit his trading style.

Greg focuses on certain stocks that he trades often – both on the long and short side. And as the name of his publication suggests, he never holds more than 10 positions at a time.

Greg's subscribers know that Advanced Micro Devices (AMD) is one of his favorite stocks to trade. In case you're unfamiliar with the company, it's a $100 billion semiconductor maker.

In 2020, he made 10 different trades on AMD alone – with his position sizes varying from 0.5% to 1%. He booked nine winners and one loser among those trades. Two were home runs – gains of 181% and 111%. And he booked high-double-digit returns on five others.

His one losing trade with AMD – a 45% loss – was just a 0.5% allocation.

On the hypothetical $100,000 portfolio size, Greg would've lost a tiny $226 on the one loser... and made $4,875 on the other nine winners.

That's an outstanding trade-off. And it shows what's possible with a disciplined approach.

But Ten Stock Trader is more than just a compilation of trades...

Greg tracks and monitors the macro environment, looking across all sectors and industries. He sends a "weekly market outlook" to subscribers bright and early every Monday morning. Then, he provides regular updates and trade recommendations in his "direct line" feed on our website. You can also access everything on the Ten Stock Trader phone app.

Overall, Greg is super passionate about the markets... and loves what he does. I've seen him make posts at all hours of the day and night as he follows markets around the globe.

It's hard to find anyone more dedicated or who works harder at this than Greg. That's not a sales pitch. I read all of our feedback. For example, paid-up subscriber Ryan R. said this...

Goodnight Greg! ... Just wanted to say Thanks for the round-the-clock updates. Greatly appreciated! Please pass on to your wife how incredibly grateful we are for the positive impact and life changing results your loyal followers are obtaining for our families lives because of the work you do, and how incredibly grateful we are for ALL that she does as well!!... Because we know that without them none of us would be able to achieve any desirable or meaningful success or true happiness!

And if you're a regular Digest reader, you've likely seen similar messages in the daily mailbag many times over the past year. His approach resonates with our subscriber base.

We only launched Ten Stock Trader a couple years ago – a "beta" version in 2018, then officially in 2019. We're using the 2019 and 2020 track record for this year's Report Card...

Over the two-year period, Greg's total return equaled 13.5% and his average annual return was 6.8%. He booked 49 winners from a total of 81 trades (a nearly 60% win rate).

With those results, Ten Stock Trader earns a "B" for this year's Report Card.

And with that, you've now seen our full 2020 Report Card...

So how did we do? Did we shape up as well as you anticipated? Did you get what you expected from your Stansberry Research subscriptions? We'd love to hear from you... Send us your thoughts – good and bad – to feedback@stansberryresearch.com.

New 52-week highs (as of 2/18/21): JPMorgan Chase (JPM), Southern Copper (SCCO), Seagate Technology (STX), and United States Commodity Index Fund (USCI).

In today's mailbag, some observations from a paid-up subscriber in Italy. Do you have a comment or question? As always, send us your thoughts at feedback@stansberryresearch.com.

"I'm a subscriber since 2015 and I think this has been one of the best investments in my life.

"Not only have I been able to book some very nice gains, but by reading S&A research I've become a far better investor, especially in portfolio allocation and risk management. And I think the guidance you are providing me with when markets are nervous is really priceless.

"And now some food for your thoughts and consideration.

"I live in Northern Italy and last week I decided to buy a new bicycle for my wife. We love cycling. Last year, in spite of COVID, we managed to ride 3,000 kilometers.

"We chose a model [to buy], not too fancy and produced in Italy, and we started looking for it. The task proved very difficult indeed: we managed to find only three bicycles in Piedmont, a region with 4.5 million inhabitants.

"The reason? Stocks were sold out last summer but, as many components are imported from China, their delivery [time] has skyrocketed to 9 to 10 months: bicycles ordered last August are scheduled for delivery next July. Therefore not only bicycle producers are losing revenues but also resellers are running out of spare parts and are forced to shut down.

"The markets are currently pricing in a fast business recovery after mass vaccination, but if we project this scenario to the entire industry, I think the recovery won't be fast nor easy." – Paid-up subscriber Claudio N.

Good investing,

Brett Aitken
Baltimore, Maryland
February 19, 2021