Who's the Best at S&A?

Stansberry & Associates Top 10 Open Recommendations
(Top 10 highest-returning open positions across all S&A portfolios)

As of 07/08/2013

Baltimore, Maryland

* * * Goldsmith is working on a new assignment for me – tracking special dividend payments. As you know, when a $20 stock pays a $10 special dividend, the share price falls by $10 (the amount of the dividend) immediately after the dividend has been paid. But then a strange thing happens: The share price moves back up to its old high within 12 months. Financial theory says this shouldn’t happen. But we’ve studied nearly 30 of these situations over the last few years. In every case, the share price moved back up to a new high, except once (Microsoft). No, these opportunities don’t come along every day, but there are enough of them to follow closely.

Right now, Goldsmith is working on one deal in the biotech sector. A $24 biotech stock is selling some assets and has promised to distribute the cash it receives from the sale to shareholders. We estimate the dividend will be almost $14 per share. You could buy the stock now and get the $14 dividend. Or, even better, if you buy the stock after the dividend is paid, you’ve got a great chance at seeing a $14 stock move up to $24 within 12 months. That’s a low-risk way to make 71%.

* * * The latest from Hancock (who’s got China on the brain): "Starbucks plans on opening at least 100 stores a year in China… That’s part of 20,000 stores Starbucks plans on opening internationally, 10,000 of which are slated for Asia alone. When I lived in Hong Kong, you couldn’t get a seat in a Hong Kong Starbucks. It’s like a Macau casino. The same was true of the Starbucks in Shanghai."

* * * More data on your fellow deadbeat Americans: Total spending last year exceeded American earnings by $41,600,000,000. The average number of credit cards per U.S. household: 12.7. One-third of Americans have no savings at all, while the next third have less than $3,000 in savings.

It seems like most people aren’t prepared for any downturn in our economy. And given the role government has assumed (nanny), I know what’s going to happen when most people go broke. The deadbeats will vote themselves everything we’ve got. Hope my wife likes our place in Nicaragua…

* * * Dan Ferris has a hot hand. His latest semiconductor equipment recommendation (loaded with cash) is up 10% today. Lots of other new highs too: Oakley, Excelon, KHD Humboldt, and Qiao Xing. If you’re using trailing stops, move ’em up.

* * * Oh boy… Paid-up subscriber Don Wiginton begins his e-mail to us with this subject line: "Suck wind you shil [sic]." And it didn’t get much better (for us) from there. He continues, "All you guys do is knock, denigrate and downgrade anything of value… I would almost wager that you gold buggering negative thinking so and so made your money by inheriting stolen value… I myself have learned that any mail or e-correspondence from within 150 miles of Fredrick MD is likened to the pleas of a television preacher: I respond by reaching to confirm that my wallet is still in my pocket…" Ouch. For the record: I don’t know about the other guys in the office, but the only thing I ever inherited was a stubborn streak.

* * * Paid-up subscriber Hans Martin is worried about Glacier National Park. He notes that according to the Park Service, "The glaciers in Glacier National Park are melting. In 1850, 150 glaciers covered the landscape. Today in 2006, there are only 27 glaciers left inside the park, a 75-80% decrease. If current warming trends continue, it is projected that between 2030 and 2050, there will be no more glaciers in Glacier National Park." Hans asks, "So Porter, what will you call Glacier National Park when the glaciers are gone?" Mmmnnn… That’s a good question. How does the Al Gore National Wilderness sound to you?

* * * My favorite comment today comes from paid-up subscriber Fred Wiedemann, who wrote knowingly of my upcoming bull and oyster roast, "I can imagine that with a lot of investment advisors around that there will be a lot of bull…" You’ve got that right, Fred.

* * * Finally… human nature dictates that anytime you ask for comments about your work, the only people motivated to respond are the folks who are mad at you. Thus, we’ve long suspected that anyone who sends us positive feedback is drunk, crazy… or related to us. We were right: "I think Porter’s writing is great… Of course, I am his mother! Hope all of you are having a great week, and I hope to see you all this weekend!" Thanks, Mom.

* * * The anxiety is building at my house. We’ve got half a dozen guests staying with us… and another 100 or so people coming over for dinner on Saturday… a bluegrass band… horseshoe pits… two full bars… "Porter, I need you to pick up the garden hose and put it in the barn," my wife told me early this morning.

"Okay… I can do that… but why do we need to put the hose away? It’s just sitting in the flowerbed. It’s not going to bother anyone."

"JUST DO IT!"

* * * * * * * * * * * * * * * * *

So… who is really the best at S&A?

Mea Culpa. I was wrong.

For a long time, I was sure Dan Ferris was our best stock picker. Jeff Clark said nothing. And I had no idea just how good his picks had been, because they move in and out of his portfolio so quickly.

Now the facts are in. We’ve been publishing Jeff Clark’s newsletter (The Big Trend Report) for one year. In that time, Jeff initiated and closed out 10 positions. Nine of these investments made money (90%). The average return of these 10 recommendations was 48%.

Incredibly, the average holding period was only five months.

I’ve always been skeptical of rapid-fire investing. From my experience, I’d learned that the more trades you make, the more likely you are to stumble into a bad pick… and suffer a big loss. But not Jeff.

How did he do it?

Jeff has been a professional investor for more than 20 years. It’s obvious that he’s become an expert at anticipating major trends in the market – and just as importantly, knowing when to get out of an idea.

Late last year, the entire metals complex took off. Jeff told readers it was going to happen and had a bunch of picks lined up to jump on the trend.

Jeff’s Big Trend Report made 104% on North American Palladium – the very first recommendation in the newsletter. He scored similar gains in Desert Sun Mining (77%), Stillwater Mining (60%), and Northgate Minerals (128%). Early this year, China started heading higher. Jeff recommended Qiao Xing in February, already has sold half of the position, and is up 116%.

Now I understand why Jeff objects to our focus on "open positions." By focusing on trends instead of individual stocks, Jeff is able to pile up multiple winning positions all based on the same investment rationale. Doing so makes money – quickly.

What Jeff has accomplished is impressive – and is head-and-shoulders better than any other editor (myself included) at Stansberry & Associates.

Ironically, today one of Jeff’s picks (Qiao Xing) unseated Elan (one of my picks) on our top-10 open positions list (see below). Even so, our focus on open positions hasn’t given Jeff the credit he deserves.

To recognize Jeff’s excellence, we’re now going to publish a "Hall of Fame" list – the 20 best recommendations we’ve ever made (all closed positions). As you can see below, Jeff’s picks make up about half of our Hall of Fame.

With these results, I’ve gotta crown Jeff Clark the best stock picker at Stansberry & Associates. Congratulations, Jeff.

It goes without saying that if you’re not reading The Big Trend Report every month, you’re missing out on the very best material we publish.

Good investing,

Porter Stansberry

P.S. Yes… you can bet that my competitive juices are flowing. My plan is to outperform Jeff over the long term, by picking totally safe stocks that will compound at a faster rate than he can earn with trading profits. In a few years… we’ll see who wins.

Stansberry & Associates Top 10 Open Recommendations

Stansberry & Associates Hall of Fame