The Post's stock picker, Hilary Kramer, is leaving the competition in the dust.

Kramer's 14 stock picks this year are up an impressive 7 percent while the Dow Jones industrial average is down 14.9 percent and the S&P 500 is off 14.0 percent. Even Warren Buffett's Berkshire Hathaway is 15.3 percent on the downside in 2008.

That's right, if you invested $1,000 in each of her 14 stock picks this year, you'd be sitting pretty with a portfolio balance of $14,973.43.

Eleven of Kramer's 14 picks are in positive territory, led by a 63 percent gain in LeapFrog Enterprises, which Kramer picked back on Jan. 13 when it was trading at $4.97. It closed Thursday at $7.85.

http://www.nypost.com

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So, after the news of the past couple days, I have added to the position in Dow Chemical (DOW). At prices averaging $32, even we tripled the position in Dow yesterday and today.

Current yield, 5.25% and rock solid safe. Think about it: Berkshire Hathaway's (BRK.A) Warren Buffett only got 8.5% on his $3 billion convertible and it is underwater if shares are under $41 and change (28% higher than today) in 5 years ($41 is the conversion price).

Now, Warren's 8.5% is stagnant. My dividend will grow and I will also gain the additional 28% price appreciation of the shares if they sit at $41 when Warren converts at no gain other than the interest he has received.

Dow has increased the dividend 18% over the past three years. Assuming a consistent growth, three years from now the dividend will be $1.94 for a yield on my investment of 6%. Again given the same growth, I will get $2.17 a share when Warren converts his shares and I will be yielding 6.8% on my initial investment.

The dividend growth enjoyed by shareholders may just turn out to be a conservative growth rate that I am using for comps. The reality may very well be far better than that, but is very unlikely to be anything less than the current yield given the company's history. Even were the dividend to stay flat for 5 years (again, very unlikely scenario), the common at these prices offers superior appreciation prospects.

When you add the 28% share price growth I will get in order for shares to get to $41, right now, common share buyers today are getting a better deal than Warren. He will receive interest totaling a 42.5% over the five years and if the dividend on the common stays the same for 5 five years, I will receive 26.25% plus the 28% appreciation in the shares for a total return of 54.25%. Should the dividend grow as is has, the return on my invested cash goes to 58% plus.

Chances do not come around very often to get a better deal than Warren....grab it.

Source: http://seekingalpha.com

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To generate investment profit in today's turbulent market environment, it is important to focus on long-term fundamentals and select stocks that are well positioned for long-term growth.

In addition, when one goes "bottom fishing" for stocks that have been beaten down, it is important to focus on stocks with strong fundamentals to avoid picking up "dead fish" that do not recover when the market goes back up.

As the price of oil continues to skyrocket, there are several industries that are well positioned for long-term growth - these include demand response, solar, and wind power.

Demand-response solution providers allow utilities to be able to deal with peak demand in the electrical power grid without building additional expensive peaking power plants that also pollute the environment.

* EnerNOC is currently the market leader in the demand response business. Its shares closed Thursday at $17.82. Last year revenues grew 124 percent, which demonstrated the strong growth potential of this company. My 12-month price target is $23, which means you should start taking profit as the stock goes above $21.

* Comverge is also a leader in the demand response business which in February 2008 executed a new long-term pay-for-performance virtual peaking capacity contract with Southern Maryland Electric Cooperative. Comverge shares closed last week at $13.04. In the last 12 months, it had revenue growth of 77 percent, which is also outstanding. My 12-month price target is $18, which mean profit taking should start above $16.

* MEMC Electronic Materials is a global leader in the manufacture and sale of wafers for solar photovoltaic cells and have been a pioneer in the design and development of wafer technologies over the past four decades. Its shares closed July 3 at $54.96 per share. While its revenue growth was only 21 percent last year, its earnings growth was 47 percent. My 12-month price target is $95, which means profit taking should take place at prices above $85.

* American Superconductors is a leading energy technologies company that serves the wind power and electric power grid transmission industries. Its shares closed last week at $31.98. Revenue for the last year grew at a very healthy clip of 115 percent - and that growth is also expected to continue through 2008. My 12-month price target is $49, which means profit taking should start at prices above $45.

Hilary Kramer runs a green investment fund that owns long positions in the above stocks.

Source : http://www.nypost.com

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There are many websites that will help you determine what your portfolio should look like. Easyallocator.com, for instance, will analyze your investments and measure what percentage should be in each asset type and in what types of accounts.

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Stock funds are on sale.

And while it's possible that the prices of stocks, and thus stock mutual funds, will be slashed even further, this is a good time for long-term investors to be thinking about putting more money to work in the market.

Many investors are feeling queasy with the Dow Jones Industrial Average down 20.3% from its October closing high -- now technically in bear-market territory, as commonly defined as a 20% drop. Last week the Dow slid 0.5%, bringing its year-to-date drop to 14.9%.

But if you're saving toward a distant goal like retirement, remember that your investment today buys more shares. Despite bear markets and recessions, over time the stock market tends to rise and those extra shares become worth more.

"Volatility is a friend to long-term investors" who can use the "opportunity to buy when things are cheap," says Curtis Jensen, manager of Third Avenue Small-Cap Value Fund.

One way to take advantage of today's discounts without losing too much sleep: seek out mutual funds that have strong long-term returns along with less downside risk than their peers.

Ten Funds to Consider

To that end, Morningstar analysts recently sorted through their database for U.S.-stock funds with strong 10-year records under long-tenured managers -- as well as "below average" or "low" risk ratings as figured by the Chicago research firm. Those risk ratings are based on how often a fund has lost money compared with others in the same category.

A total of 16 funds met these and some additional criteria, including assets of at least $1 billion; of those 16, the 10 funds with the best 2008 performance rankings in their respective categories, including Mr. Jensen's fund, are shown here.

Focusing on a fund's long-term performance allows investors to look past recent market volatility for a better picture of overall fund performance, including how "funds performed through various market cycles," says Morningstar analyst Karin Anderson.

Over the past decade, the 16 funds identified by Morningstar have delivered returns equivalent to 6.91% a year, versus just 2.88% a year for the Standard & Poor's 500-stock index, the most widely used benchmark for U.S.-stock funds.

But investing even in proven, less-volatile stock funds doesn't mean avoiding losses. Indeed, none of the 16 funds showed a positive return from the Dow's all-time high on Oct. 9 through midyear. Over that period, 14 of the funds had smaller declines than the Dow, and 13 had smaller drops than the S&P 500.

Long-Term Perspective

A number of the funds on Morningstar's list aim to hold shares of solid businesses for years at a time. For instance, Baron Growth Fund seeks well-managed small businesses with the potential to double in size every five years, while doubling the value of the fund's investment, says manager Ron Baron. "We look for companies that are going to grow in a long period of time, no matter what happens in the stock market."

While the companies may be growing, however, those share prices on average haven't grown in recent months: Baron Growth was down 14.18% from the market high through midyear.

Mr. Baron figures even the fund's worst-performing holdings this quarter, recreation and resort companies including Wynn Resorts and Ameristar Casinos, will eventually "see a comeback." People are trimming their spending now, but in time "everyone wants to go on vacation and will just work harder to get there," he says.

Mr. Jensen's Third Avenue Small-Cap Value has the best 10-year record among the 10 funds on our list, and it has also declined the least since the market peak. It ranks in the top 10% of Morningstar's "small value" fund category so far this year and over the past 12 months.

Mr. Jensen aims to invest in cheaply priced stocks of companies with strong balance sheets. The fund has benefited from significant holdings in the strong-performing energy sector while avoiding struggling financial companies and home builders.

Taking a different tack, Meridian Growth, run by Rick Aster, tends to avoid cyclical stocks like energy and industrials. "Meridian bets on consumer staples with a patient approach that has been holding up well," Ms. Anderson of Morningstar says. One recent top holding: dental-products supplier Dentsply International.

Stung by Financials

Some funds that favor stable dividend-paying stocks have been stung recently by losses on financial shares, traditionally a core holding of such funds.

For instance, American Century Equity Income Fund sold Citigroup and Freddie Mac at a loss in the second half of last year, co-manager Phil Davidson says. The fund declined 14.5% from the Dow's peak through midyear.

Still, the fund ranks in the top 20% of Morningstar's "large value" category this year and over the past 12 months. "It would be almost impossible not to be down, but we're keeping our record going on a relative basis and hoping for a smoother ride," Mr. Davidson says.

Source : http://online.wsj.com

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