Tortoise, Hare To Pace S&P 500
The paper portfolios will debut in the group’s newly revamped monthly newsletter, Morningstar StockInvestor, to be mailed in mid-July and will highlight the group’s approach to investing.
Slow and Steady
Although both portfolio’s will aim to outperform the S&P 500, the value oriented Tortoise portfolio is targeted at conservative equity investors, and maintains exposures to stocks that have lower-than-average valuation ratios.
The Tortoise portfolio comprises the following 12 stocks:
- Berkshire-Hathaway
- Black & Decker
- Humana
- Interpublic Group
- Jones Apparel
- Kemet
- Kimberly-Clark
- Liz Claiborne
- Office Depot
- Sears
- Service Corp International
- Sherwin-Williams
Fast and Furious
The Hare portfolio on the other hand is designed for investors with a higher risk tolerance, holding stocks with stocks with higher-than-average valuation ratios, signifying loftier investor expectations. The 11 stocks held within this portfolio are:
- Alcide
- Autodesk
- Boston Scientific
- Charles Schwab
- EMC
- Knight Trading
- Nokia
- Oracle
- Reuters
- Sprint
- Sun Microsystems
Real World
In order to simulate the real-world experience of investors, the portfolios will assume:
- a $10 brokerage commission per trade,
- a 28% tax rate on all short-term capital gains,
- a 20% tax rate on long-term capital gains, and
- monthly dividends reinvestment.
The investment decisions will be made by:
- Mark Sellers, editor-in-chief of Morningstar StockInvestor,
- Pat Dorsey, director of stock analysis,
- Haywood Kelly, editor of Morningstar.com, and
- Morningstar’s senior stock analysts,
Composition updates and performance data for each portfolio will be published in Morningstar StockInvestor, along with a commentary on the portfolios.
You Might Also Like:
« FIRST CONTACT – Hewitt Brings Consulting Expertise To Employees