A Week Chock Full of 52-Week Highs

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

It was a very good week for your Alpha Investor Letter portfolio. The Dow Jones jumped 2.54%, hitting a new record high. The S&P 500 rose 2.86%. The MCSI Emerging Markets Index also recovered 1.11%.


It is encouraging that the S&P 500 broke out of a recent trading range yesterday. Its next major point of resistance is around 1,565. That said, if history is any guide, it will take a while for it to break through that long-term resistance level.

Your biggest gainers included Two Harbors (TWO), soaring 6.84%; Berkshire Hathaway (BRK-B), leaping 3.99%; S&P Global Timber & Forestry Index Fund (WOOD), gaining 3.61%; WisdomTree Japan SmallCap Dividend ETF (DFJ), leaping 3.36%; and Wisdom Tree Japan Hedged Equity (DXJ), jumping 3.06%.

All of these positions hit 52-week and/or all-time highs. Tighten your stop on Berkshire Hathaway (BRK-B) to $98.00 and on Two Harbors (TWO) to $12.10.


Vanguard Global ex-U.S. Real Estate Index Fund (VNQI) rose 2.44% and moved back to a BUY.

All of your current Alpha Investor Letter positions are profitable and are BUYs.

The last six months have been quite strong for many of your Alpha Investor Letter-based positions.

Just look at how Berkshire Hathaway (BRK-B) has performed against the S&P 500 over the past six months.

It also is worth noting that your bet on private equity through PowerShares Global Listed Private Equity Portfolio ETF (PSP) has outperformed the U.S. market by over 2 to 1 during that same time period.

The same can be said of your bet in timber through S&P Global Timber & Forestry Index Fund (WOOD).

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Your two bets on Japan — the best-performing major global stock market of the past four months — have also performed equally impressively.

Overall, your current Alpha Investor Letter portfolio is well-positioned to profit from the current market rally.

Portfolio Update

Berkshire Hathaway (BRK-B) jumped 3.99% last week and hit a new 52-week high. Warren Buffett was back in the news this week after sitting down for an interview Monday morning on CNBC. He said the economic recovery will continue and added “it’s not going to reverse, and I do not think the sequester will cause it to go into reverse.” These words are comforting, coming from a man who usually gets things right. BRK-B is a BUY.

Visa Inc. (V) rose 1.56% last week. V’s battle to break meaningfully above the $160-price level raged on for its eighth week last week. However, a concerted move upwards should materialize within the next few weeks as the 50-day moving average is on the rise directly below. V is a BUY.

WisdomTree Japan SmallCap Dividend ETF (DFJ) gained 3.36% last week. DFJ is showing just what a little “economic stimulus” can do. Japan’s new monetary policy appears to have set the fires burning under DFJ, propelling it to two new highs not seen in nearly one year’s time — the $45-price level and a new 52-week high above $46. DFJ is a resounding BUY.

PowerShares Global Listed Private Equity Portfolio ETF (PSP) rose 2.27%, erasing last week’s dip. Markets have been in rally mode for quite some time now, as has PSP. With “bank stress test” results due out on Thursday, positive numbers on the financial sector could be a further good catalyst for a rally in PSP. PSP is a BUY.

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Vanguard Global ex-U.S. Real Estate Index Fund (VNQI) added 2.44% over the past five trading days. The cooling-off in the housing sector is proving quite short-lived, making the recent dip in VNQI appear to be just another chance to buy. VNQI not only closed yesterday at a new 52-week high, but moved back to a BUY as well.

S&P Global Timber & Forestry Index Fund (WOOD) rose 3.61% last week as it followed the same road to recovery as VNQI — and managed a new 52-week high as well. Thursday and Friday saw buying volume hit levels not seen since 2010, as investors piled back into WOOD (pun intended). WOOD is a BUY.

Two Harbors (TWO) jumped 6.84% last week. Forming the third member of the “housing recovery” triad in your portfolio, TWO also managed a new 52-week high. The Street currently rates TWO as a “Buy,” citing good revenue growth, low valuation and rising profit margins. TWO is a BUY.

Wisdom Tree Japan Hedged Equity (DXJ) gained 3.06%. After several weeks of trading sideways, DXJ rose as the Japanese yen resumed its downward move — a positive for this yen-hedged position. DXJ is a BUY.

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