Rule Breaker Portfolio

<THE RULE BREAKER PORTFOLIO>
What Happened to Fool Port?

Let There Be Light!
Happy Holidays to All

by Selena Maranjian (TMFSelena@aol.com)

ALEXANDRIA, VA (Dec. 24, 1998) --

"In this world, which is so plainly the antechamber of another, there are no happy men. The true division of humanity is between those who live in light and those who live in darkness. Our aim must be to diminish the number of the latter and increase the number of the former. That is why we demand education and knowledge."
   -- Victor Hugo

'Twas the night before Christmas and TMF Jeff, spending some time in the city of lights, handed the Rule Breaker report reins over to TMF Selena, who lives and works in the city of wigs. (Well, maybe Alexandria isn't known as the city of wigs, but it ought to be. A few blocks from Fool HQ, across the street from each other, are two wig stores. We're talking tacky wigs here. Hairdos that went out of fashion with pet rocks. But I digress.)

Before I digress again, as I'll invariably do, let me review today's market activity. Actually, let's be daring and skip it. That's right -- let's not review how our trusty portfolio did today. We get some flak now and then about how we stress long-term investing but then scrutinize our portfolios' performances each night. Well, we do that largely because it's fun to see how we've done each day. And because there are always lessons to be drawn. However, it's certainly not a requirement that Foolish investors check their portfolios so regularly. (Did you know that you can set up your own portfolios to track, right here at the Fool? Just click on the "My Portfolio" tab up top on our main web page at www.fool.com.)

Let's proceed to the heart of tonight's report: light. As Victor Hugo so eloquently said above, education helps people live in the light. What does this have to do with The Motley Fool and Christmas Eve? Well, plenty.

It should be clear to many that the Fool is trying its darnedest to offer education about investing and personal finance to all. We do it on our website, on our radio show, in our newspaper feature, and in our books. We even do it in elevators and airplanes, whenever some unenlightened person unwittingly finds himself next to us. For there are far too many people still in the dark. Too many people put all their life savings and their trust in underperforming mutual funds. Too many people don't even get that far, neglecting to save and perhaps even getting mired in credit card quicksand.

Look in the shadows around your life. Is that your sister living in financial darkness? Is that a black hole in your workmate's wallet? Is your neighbor taking "flyers" on hot stock tips and lottery tickets?

What's separating these folks from financial enlightenment? Is it... you? Are you enjoying the brightness all around you and at the same time casting a shadow on some people close to you? Step aside, Fool. Guide some loved ones to the light. Sit down with your sister and help plan her escape from credit card debt. Buy your neighbor a book on personal finance. Introduce your workmate to the Fool -- we're free, and open 24 hours a day. Getting nudged in the direction of financial security might be the biggest favor these folks ever receive. Imagine the pleasure of seeing a light bulb go on over their heads!

Light plays an important role at this time of the year. And I'm not just talking about Christmas, with its Advent candles, Christmas trees and Main Streets festooned and sparkling. (Note, though, that the real Christmas story began with just one light, shining overhead.)

Just as Christians around the world are preparing for Christmas, the faithful of many other faiths are likewise gearing up for or recovering from their own holidays. Interestingly, in many of them, light is an important element. Perhaps because we're pretty much at the shortest days of the year, light is more precious now.

Let's review some major religions and see what investing lessons we might draw from their respective holidays. We can do this because The Motley Fool is an open forum, respecting freedom of religion and freedom of financial opinion. (Within limits, of course. Technical analysis-oriented day-traders and followers of the Order of the Sacred Shrimp may be happier hanging out elsewhere.) If you're new to Fooldom and only read these Rule Breaker Portfolio (formerly Fool Portfolio) reports, know that there are other portfolios in our Hall, run by different Fools with different approaches. Likewise, within our community, there are thousands of message boards and thousands of opinions. Differences abound.

Consider Hanukkah, which has just passed. It's the Jewish Festival of Lights, lasting eight days, with a candle being lit on the first night and additional candles added on successive nights. Hanukkah commemorates the rededication of the second temple in Jerusalem. Looking at a menorah with nine candles, one might imagine a healthy Foolish portfolio, shimmering with nine stocks. The typical Fool should aim to hold between (roughly) eight and fifteen stocks. You'll need to understand and follow each one, so you shouldn't have more than you can handle. (Ever seen a birthday cake with scores of candles on it? Too many to control, too many to blow out... wax meltdown!)

Happening in October and November for Hindu believers is Diwali, one of the religion's biggest holidays, lasting five days. It's also called the Festival of Lights. One of the goddesses most feted at Diwali is Lakshmi. Of interest to Fools, she's the goddess of wealth and prosperity (among other bounties, such as health, family and brains). Diwali observers attend to removing darkness from their homes and hearts: cleaning, opening windows, and setting right their frames of mind. Lights are also lit around the home, with rivers lit up at night by myriad candles floating down them.

Diwali might inspire Fools to regularly scrub their portfolios clean. If there are some hopeless turkey investments still sitting in your portfolio, consider getting rid of them. (Read up on the tax implications first, though, online or in our book!) Once your portfolio is whittled down to the stocks you understand best and believe in most, it will take on a new glow of its own.

Occurring just after Christmas is Kwanzaa, celebrating African and African-American values and traditions. It lasts seven days, with each day dedicated to one of the following seven principles: Umoja (unity), Kujichagulia (self-determination), Ujima (collective work and responsibility), Ujamaa (cooperative economics), Nia (purpose), Kuumba (creativity) and Imani (faith). Not surprisingly, the holiday also includes the lighting of Kwanzaa candles.

The principles above relate well to Fooldom. Look at our message boards and you'll see cooperative economics in action. And a little unity, too. Creativity abounds, particularly in Fribbles. By taking control of our own finances, we can determine our own futures.

Buddhists observe Bodhi Day in November or December, commemorating Buddha's enlightenment, which took place around 596 B.C. The light for this holiday is one of revelation, as the Buddha finally discovered the root of suffering: desire. There might be some Fools out there who've circled on their calendars the date when they experienced their own financial enlightenment. Others may have noticed that the root of stock market suffering is often desire. It's greed that makes us think about risky and un-Foolish enterprises like options, futures, and titanium mines in Upper Armenia.

Ramadan, observed by Muslims in honor of Mohammed's revelations, began a few days ago and lasts 30 days. It involves fasting from sunrise through sunset (no mean feat for Muslims near the Arctic Circle when it falls in summer!). Light plays a part in this tradition, too. If I recall correctly from my expatriate childhood in a Muslim country, fasting ended when a designated person holding a hair from a black goat and a hair from a white goat could no longer tell them apart and began again when he could. (Cannons were fired, to let people know when the moment occurred.) Many Muslims believe that by fasting, they not only worship God, but also gain insight into what it's like to be poor and hungry, thus fueling charitable giving.

Here at the Fool, we're also in favor of contributing what we can to those who don't have what we have. We won't ask you to fast, though. Instead, we ask that you grab a few dollars (or shares of stock) and send them on their way to our annual Share Our Strength charity drive. (Act now! The drive ends in about a week.) We realize that you can and probably do already contribute to other causes you favor... but please take a few minutes to read about what we're up to here. We'd like every Fool out there to send in something -- even if just a dollar. Be counted, so that we can be reminded how many Fools with hearts are out there! Let's not, in the words of Shakespeare, "waste our lights in vain, like lamps by day."

Finally, we return to Christmas. To Christians, the holiday commemorates a big gift from God. Thanks partly to American ingenuity and capitalism, we've transformed the holiday into one of massive giving to each other. (It's funny when you think about it. God offers forgiveness and grace. We offer fruitcakes, fluffy slippers, and Furbies.)

Fool, this year, when you admire the lights of the season, think about how you can spread some financial light to others around you. Scrub down your portfolio so that your holdings can shine more brightly. Light a candle for self-determination. And...

Happy Holidays!

[Note to readers: I hope I haven't mangled the facts of any religion covered here. I did my best.]

--Selena Maranjian


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Bookmark Live Rule Breaker Port Quotes

12/24/98 Close
Stock  Change    Bid 
 ---------------- 
AMZN  -  3/16 324.81
AMGN  -1 1/4  101.00
AOL   -1 3/4  136.25
T     -  5/16  74.56
ATHM  +8 7/8   80.88
DJT     ---     4.00
DD    +1       55.94
XON   -  3/8   74.63
IP    +  1/4   43.31
IOM   +  1/8    8.06
LU    -2 7/16 107.50
SBUX  +1 1/8   52.38
TDFX  -  3/16  12.19
 
                   Day   Month    Year  History  Annualized 
      R-BREAKER  +0.42%  39.26% 188.31%  867.58%   67.78%
        S&P:     -0.18%   5.38%  26.36%  167.51%   25.15%
        NASDAQ:  -0.44%  10.95%  37.74%  200.35%   28.50%


    Rec'd    #  Security     In At       Now      Change
   8/5/94  1100 AmOnline       1.82    136.25    7395.74%
   9/9/97   440 Amazon.com    19.74    324.81    1545.64%
  5/17/95  1960 Iomega Cor     1.28      8.06     529.68%
  10/1/96    84 LucentTech    23.81    107.50     351.53%
  8/12/96   130 AT&T          39.58     74.56      88.39%
  4/30/97 -1170*Trump*         8.47      4.00      52.77%
  12/4/98   450@Home Corp.    56.08     80.88      44.21%
 12/16/98   290 Amgen         85.75    101.00      17.78%
  2/20/98   200 Exxon         64.09     74.63      16.44%
   7/2/98   235 Starbucks     55.91     52.38      -6.32%
  2/20/98   215 DuPont        59.83     55.94      -6.51%
  2/20/98   270 Int'l Pape    47.69     43.31      -9.18%
   1/8/98   425 3Dfx          25.67     12.19     -52.52%

    Rec'd    #  Security     In At     Value      Change
   9/9/97   440 Amazon.com  8684.60 142917.50  $134232.90
   8/5/94  1100 AmOnline    1999.47 149875.00  $147875.53
  5/17/95  1960 Iomega Cor  2509.60  15802.50   $13292.90
  12/4/98   450@Home Corp. 25236.13  36393.75   $11157.62
  10/1/96    84 LucentTech  1999.88   9030.00    $7030.12
  4/30/97 -1170*Trump*     -9908.50  -4680.00    $5228.50
  8/12/96   130 AT&T        5145.11   9693.13    $4548.02
 12/16/98   290 Amgen      24867.50  29290.00    $4422.50
  2/20/98   200 Exxon      12818.00  14925.00    $2107.00
   7/2/98   235 Starbucks  13138.63  12308.13    -$830.50
  2/20/98   215 DuPont     12864.25  12026.56    -$837.69
  2/20/98   270 Int'l Pape 12876.75  11694.38   -$1182.38
   1/8/98   425 3Dfx       10908.63   5179.69   -$5728.94

                              CASH  $39332.55
                             TOTAL $483788.18

</THE RULE BREAKER PORTFOLIO>

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