By Rolfe Winkler (Option ARMageddon):
The latest results of Mark Hulbert’s long-term newsletter performance rankings are fascinating. His rankings track performance for 160 investor newsletters that have been around since 1980. There’s a new leader of the pack, Charles Allmon’s Growth Stock Outlook.
Allmon has been almost completely out of stocks for more than 20 years. It was in late 1986, in fact, that he became convinced that stocks were becoming overpriced, a belief that in turn led him to sell almost all of the stocks in his newsletter model portfolio and put the proceeds in cash.
With only one or two exceptions, his model portfolio has remained primarily in cash ever since. It currently owns just three stocks that collectively total 11% of total portfolio value, for example; the other 89% is parked in a money market fund.
Allmon’s perseverance in adhering to his high-cash position looked increasingly anachronistic during the bull market of the 1990s and the go-go years of the Internet boom, if not downright stubborn and obstinate.
But the bear market over the past year and a half has changed that. He has been creeping up in our long-term rankings in recent months, and as of the end of this past month, took over the first place position.
There isn’t one other guy who rode stocks a bit longer before going to cash? What about newsletters that have been net short recently? Surely there are some. But maybe not. It’s amazing that none of the other 150+ newsletters that Hulbert tracks backed out of the market in time. Hell, OA’s cash position has been 90%+ since 2006. And nobody pays us for advice!
A great story in any case.