Comment
0
Tweet
0
Print
RSS Feeds

Why "The World's Greatest Growth Portfolio" Continues to Outperform the Market

Tuesday - 6/25/2013, 2:52pm  ET

At the beginning of 2012, I decided the most honest and effective way to help the world invest better was to publicly show how I go about making decisions for a public portfolio aimed at innovative growth companies. The intent is to hold each company for at least a year and recalibrate only with each new year.

Since then, an investment of $50,000 would have grown to $67,900 -- or $5,500 more than if it had just been invested in an SPDR S&P 500 ETF. Read on to see what major developments have occurred with the companies in the portfolio and how you can find out which of these 13 stocks are great buys right now.

Core

Company

Allocation

Jan. 1st Balance

Current Balance

Change

Baidu 

11.5%

 $115.00

 $107.07

-6.9%

Google 

11.5%

 $115.00

 $143.18

24.5%

Amazon.com

11.5%

 $115.00

 $125.35

9%

Whole Foods 

11.5%

 $115.00

 $129.03

12.2%

Tier One

Starbucks 

7.5%

 $75.25

 $90.75

20.6%

Apple

7.5%

 $75.25

 $58.47

-22.3%

Intuitive Surgical 

7.5%

 $75.25

 $77.21

2.6%

IPG Photonics 

7.5%

 $75.25

 $67.20

-10.7%

Tier Two

3D Systems

5%

 $50.00

 $61.15

22.3%

LinkedIn 

5%

 $50.00

 $74.90

49.8%

Stratasys

5%

 $50.00

 $51.25

2.5%

Westport Innovations 

5%

 $50.00

 $53.55

7.1%

Lululemon Athletica

5%

 $50.00

 $40.60

-18.8%

 

       

Year to Date

 

 $1,000.00

 $1,079.70

8%

Returns Since Inception

     

35.8%

Source: YCharts. Because this portfolio is focused on capital appreciation, dividends are not accounted for in either individual stock or market returns.

Major developments
During June, two of the 13 companies in this portfolio made major announcements. The first was apparel company Lululemon. Although its quarterly report was impressive -- showing a 21% jump in revenue while earnings were basically flat due to the company's embarrassing Luon pants fiasco -- it was another revelation that caught investors off-guard: CEO Christine Day is stepping aside.

As best people can tell, Day really is leaving for "personal reasons." Investors are worried that without Day, whose track record at Lululemon is beyond impressive,  the company may lose the momentum it has built over the last five years. That helps explain why shares were down more than 20% in the days following the announcement.

The other major development came from 3-D printing company Stratasys. I have long said that I favored Stratasys over rival 3D Systems (though I own both) because I like the former's focus on fewer, more strategic mergers.

Well, Stratasys made its second major purchase in the past year, announcing that it would be merging with Makerbot for $400 million in stock. The move is important because Stratasys has focused primarily on industrial and business clients for its higher-end printers while 3D Systems has had the consumer market cornered for some time now. The addition of Makerbot, however, gives Stratasys some serious exposure to consumers, due in large part to its Replicator 2 printer.

Minor developments
Two other companies came out with news this month, though much tamer by comparison to Stratasys and Lululemon.

Apple held its Worldwide Developers Conference (WWDC). Among the big announcements:

  • iTunes Radio will be an ad-supported option for iTunes users and will offer real competition to Pandora.
  • iWork for iCloud will be a service that aims to compete with Google docs.
  • The company unveiled its newest operating system, iOS 7.
   1 2  -  Next page  >>