Zynga ($ZNGA) is up more than 15% in the last two days in a flat market. This is a classic Billionaires stock, it is basically a call option with zero downside. Zynga has zero debt and $1.67 in cash per share. The stock traded for almost its cash position at $2 just over three month ago.
Now there are rumors that Zynga is going to be a big player in the online gambling market. Better yet one of the world’s best Billionaire Hedge Funds Tiger Consumer puchased millions of shares of Zynga last quarter, and is now up more than 50% on their position.
So as every retail investor trys to pick and a bottom in Apple ($AAPL), (and is getting burned every time), instead you could have been making a low risk 50% return on Zynga.
How?
Well just go to http://www.billionairesportfolio.com and sign up for our free text alerts, which will alert you whenever a Billionaire Investor or Hedge Fund buys a significant chunk of any stock under $5.
As everyone knows I have been warning people about trying to bottom fish on Apple ($AAPL), too many people have lost their hard earned money trying to bottom tick this stock.
Regardless of David Einhorn’s lawsuit, Apple is not a buy until it breaks the downward trend channel it is in..
Bottom Line. How many analysts from Gene Munster to Goldman Sachs have told you to buy Apple ($AAPL) that technical analysis or momentum doesn’t matter, yet the stock continues to tick down. I promise you none of the Billionaires Investors I follow are buying or have purchased Apple, almost all of them sold Apple last quarter. This stock is not going to magically go up and more importantly you are missing other opportunities in the market. My service the Billionaires Portfolio has produced two stocks that have gained a 100% or more.
As everyone knows my goal in starting the Billionaires Portfolio, is to empower and educate the everyday investor on the investment strategies and techniques that Billionaire Investors and Hedge Funds use to generate huge eye popping returns in the markets. Remember the Billionaires I am talking about are self made Billionaires, they are investors who have compounded their money at 30% to 35% a year.
Think about it this way, the average 401k or retirement account today is $80,000 according to Fidelity, $80,000 compounded at 35% a year for 20 years is $32 million dollars, am amazing amount. You will never get even a 15% annual return from investing in mutual funds, so there is no point in putting your hard earned money in mutual funds, its an industry based on mediocrity. The top 5 biggest funds that manage a combined $100 billion dollars in stocks, averaged 7.5% a year over the last 10 years, an incredibly mediocre return.
So how do you return 30% to 35% a year, and how does the everyday person become a Billionaire? I have studied Billionaires and their investing habits for over 10 years and here are some secrets that I have found:
1) Billionaires and people who have become self made Billionaires never ever, let me repeat this again, never ever invested their money in mutual funds.
2) Billionaires use Leverage, it was just discovered by the genius Hedge Fund Firm AQR that 99% of Warren Buffett’s return has come from his use of leverage, his stock portfolio was leveraged 160% or 1.6 times. Buffett learned that you must take risk to get rich.
3) Billionaires make concentrated bets, when they feel that have an edge or their is a great trade, they bet big, that is why I only follow Billionaire Investors and Hedge Funds who buy 5% or more of a company.
4) Billionaires make money in a variety of ways, stocks, commodities, and going short, So how does the every day investor do this? through leveraged ETFs. Leveraged ETFs offer the cheapest leverage in the world a borrowing cost of 1% I can leverage my money by 300% using leveraged ETFs, if I tried this through a brokerage firm or a bank they would charge me 6% to get that type of leverage.
If you subscribe to my Billionaires Portfolio, not only will I tell you about the most lucrative stocks that the worlds best Billionaire Investors and Hedge Funds are buying, but I will also tell you when to buy these stocks, based on over 10 years of backtesting, and how much to buy. Also I will tell you all the secrets that I have learned from studying Billionaires and their investing habits.
Oh and by the way my service The Billionaires Portfolio has returned 16% in less than 6 months, that’s a 35% annualized return, right in line with the Billionaire Investors I follow.
To subscribe to the Billionaires Portfolio just click here https://www.fxtraderprofessional.com/order/billionaireport/,it takes less than 2 minutes to subscribe.
This is just one of a 100 examples of why you should be piggybacking Billionaire Investor’s stock picks. Just look at this chart of Netflix (NFLX), Carl Icahn the legendary Billionaire Activist purchased almost 10% of this stock at $60 a share. If you would have subscribed to our Billionaires Portfolio text alerts you would have been able to buy Netflix (NFLX) at almost the same price as Icahn around $65 a share. Today Netflix (NFLX) sells for $180 a share, a more than 150% return in less than 4 months. Not to mention option traders would have pocketed more than a 1000% on Netflix.
2/24/2013
Every week I run a screen to find the stocks that the best Billionaire Investors and Hedge Fund Managers are down the most on. While running my scan this weekend I came across Apollo Group (APOL), which is near its 52 week low, and is almost 50% below where Billionaire Investor Donald Yacktman payed for this stock in the summer of 2012.
Donald Yacktman, of Yacktman Asset Management runs a $17 Billion asset management firm, he has the best track record of any long only manager over the last 10 years. Mr Yacktman doubled his stake in this stock last summer at prices almost 50% above today. He currently owns 6.6% of Apollo Group (APOL).
This weekend I read a great academic paper and a series of articles on how Warren Buffett has consistently outperformed the market over the last 30 years. . He did the use of leverage. Please read the article below, its eye opening.
Many of you know that I run a trading service called The Billionaires Portfolio which is an investing service that piggybacks the stock picks of the world’s greatest Billionaire investors and Hedge Funds. This service, all modesty aside, has performed excellent, our model portfolio is currently outperforming the S&P 500 by 5 to 1, and has produced two triple digit winners in less than six months since the service started. Moreover many of our subscribers are up more than 20% in their portfolios.
Remember the reason I started The Billionaires Portfolio is to show the everyday investor how the richest and smartest investors in the world are generating huge returns in the stock market, but not every Hedge Fund is the same.
Currently there are over 8000 Hedge Funds, yet only 5% or 400 of these hedge funds have actually outperformed the market on a consistent basis. So it’s crucial to know the Hedge Fund Industry the strategies these Hedge Funds employ and the managers who run them. To understand Hedge Funds you must have worked in the industry, my apologies to all journalists out there, but journalists and people who have never been employed as an analyst or trader by a real hedge fund or investment management firm (and by real I mean a firm with at least a 5 year track record and $100 million in assets), have no business analyzing or writing on Hedge Funds.
So Caveat Emptor, when you read articles on the internet about Hedge Funds, look at the author and see what their background is, because trust me its very important, as Hedge Funds use tricks and secrets that only people who have worked in the industry would be able to understand. For more on my background and how my service The Billionaires Portfolio has been able to crush the stock market, please register for my free Webinar on Wednesday February the 27th.
My first job out of graduate school was with a $1.2 Billion Dollar Institutional Hedge Fund run by a former Goldman Sachs Partner and Harvard MBA. I was lucky enough as a 25 year old kid to learn from one one of the top investment minds on Wall Street. My boss invested only in stocks and he used an investment philosophy called GARP. This is called Growth at a Reasonable Price. What this means is that you are looking to buy stocks that are growing but are still selling at a reasonable price.
My boss learned this style of investing while working as an equity analyst at Goldman Sachs, covering the retail sector. By using GARP our fund was able to beat 99% of other investment managers and our assets grew from $100 to over $1 billion in just 3 years. My point in writing this, is that GARP is the only proven investment style that works in all market conditions, both bull and bear markets. It is used by Stephen Mandel of Lone Pine Capital, who is considered the best stock picker in the hedge fund business, Mr. Mandel manages over $17 billion dollars and has averaged close to 30% a year since 1997 versus 6% in the S&P 500.
GARP works because it forces you to only buy stocks that are rising in terms of growth and price. We have seen what happens when you bottom fish or try and buy so called value stocks that are cheap or declining in price. Some of the most famous so called value managers lost more than 50% in 2008 and in 2011 using this philosophy.
So as someone who has worked at a real hedge fund, I am telling you to stay away from Apple, and ignore David Einhorn. Mr. Einhorn as I told you before, does not own enough of Apple stock to control the company or be an activist, Mr. Einhorn is just upset because he is a classic value manager who purchased Apple too high and is now down more than 20% on his position.
Apple is not a GARP stock, Apple was a GARP stock for the last 3 years, because its earnings and price kept moving up yet the stock always sold for a reasonable valuation, a P/E of 15 or less, now Apple is just a boring value stock. How do I know this? because all of the talk is not about Apple’s new products, but its about Apple’s cash, and how they are going to use it to pay a dividend. Dividend paying stocks are not growth stocks they are value stocks and oh by the way, do you know who else hates Dividend stocks, Warren Buffett.
So the bottom line is Apple is not a growth stock anymore its a value stock, its a dividend paying cash rich stock, which will never go up 50% or 100% in a year its now a nice safe company that value based mutual fund managers will buy in their funds so they can return a pedestrian 7% a year.
If you really want to make 25% to 30% returns a year in your portfolio you need to buy GARP stocks, stocks that are moving up in price and whose earnings and revenues are growing at a faster pace every year.
You can easily find great GARP stocks through our service at www.billionairesportfolio.com as we follow and piggyback the worlds best Billionaire Hedge Fund Managers like Stephen Mandel of Lone Pine Capital, who only buys great GARP stocks.
According to an article from eFinancialCareers.com yesterday, Activist Hedge Funds are primed to explode in 2013.
Performance Activist hedge funds made a killing, and are primed to be even more aggressive through the final 10 months of 2013.
Activist investor Jana Partners saw two of its funds gain over 23% in 2012, while Cevian Capital’s Cevian II fund gained roughly 25%, and Daniel Loeb’s Third Point delivered a 33.6% gain in 2012.
These strong performances are likely to attract more capital for activist hedge funds that are already sitting on piles of cash, according to a new report from Moody’s Investors Service. The rating agency expects big things from activist hedge fund managers in coming months – in technology, industrial goods, consumer goods, basic material, pharmaceuticals and energy sectors.
Proven Long Term Results from Activists Legendary Activist Carl Ichan has returned 26% a year over the last 20 years versus a 7.5% performance in the S&P 500 and that is only for the stocks in which he filed a 13D (5% or more ownership).
So what are you waiting for!! Our service The Billionaires Portfolio tracks over 200 of the biggest and best peforming Activist hedge funds and their stocks picks. We have already had some triple digit winners in less than 6 months and our portfolio is currently outperforming the S&P 500 by multiples of returns.
