Top Advisers Not Selling

Few stock newsletter writers have beaten the market in both the 2007-09 bear market and the current bull market — but those who have are saying this isn’t the time to ditch stocks, according to newsletter tracker Mark Hulbert.

Only six of the 200 or so advisers Hulbert tracks produced market-beating returns in both the current bull and the previous bear, Hulbert writes in The Wall Street Journal. “Though only three provide a specific forecast of where the S&P 500 will trade at the end of the year, all six believe that you should remain at or close to fully invested in your equity portfolios,” he says. “The predictions of the three that offer a specific forecast: a full-year rise of 10%, 10% to 15% and 15%.” The other three advisers aren’t offering a specific forecast but “are nevertheless remaining fully invested in their model portfolios, for several reasons: None gives high odds of a 2008-09 magnitude bear market beginning this year — and they believe that, even if market were to be flat for the rest of the year, well-chosen stocks should still provide a handsome return,” Hulbert says.

In addition, these advisers don’t believe in short term market timing. “Short-term trading can be a fun game, but we don’t believe it leads to investing success,” Tom Gardner of The Motley Fool, which has three separate newsletters that have beaten the market in the bull and the preceding bear, said. Gardner told Hulbert that he thinks the Fool’s newsletters have succeeded because of their buy-and-hold strategy.

Hulbert also says that right now, stocks that are liked by two or more of the six advisers tend to be those projected to produce strong growth.

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