Rule Breaker Portfolio

Rule Breaker Portfolio
Change
Warm socks, chimneys, and Frost

By David Gardner

ALEXANDRIA, VA (Sept. 22, 1999) -- It happened last night, once again.

That annual discovery.

I slept poorly. With light covers on the bed, and traditional summer garb, I spent my standard six hours of sleep tossing and turning for comfort. No socks. What a mistake! I never really reached enough consciousness to get up and pull 'em on.

Autumn is here.

Over Alexandria, Virginia and much of the East Coast last night, a chill wind blew in and changed the seasons. It found me, as it always does once a year, unprepared. So I froze. But freezing like that precedes the pleasurable experience every year of "waking up" the next morning and opening my front door and breathing in the delicious coolness of the air outside, with its subtle, spicy autumn tang.

There is a natural burlap-sack robustness to autumn air that puts the thin heat of summer to shame. And every year, I love to encounter it once again, new, for the first time. It is a pleasure of the mid-Atlantic and New England states that is still missed by many people who grew up here but moved away. I love California as much as the next guy, and perhaps I'll spend my last decade or two in New Mexico. And I know that other areas of the country see delightful autumns as well. But for sheer polished brilliance, you simply can't beat the red and gold and purples and burnt orange of New England. Takes me back to my schoolboy days.

Or, like my son today, being three years old and lying in a huge heap of leaves. Just to breathe it all in.

We're feeling the changing of the seasons in this portfolio, as well. Jeff and I are looking to liquidate some positions in the portfolio this fall and bring on a few new upstarts to Rule Breakerdom. This is consonant with the seasons, that rhythm of change we encounter four times a year (which just so happens to be the number of times a year that public companies report their numbers). We bought Amazon in the fall two years ago. Can't remember whether it was chilly that day.

The Rule Breaker portfolio bolted 4.94% higher today, well outpacing the market averages. I don't have much else to say tonight, content instead to set aside the fleeting pleasure of a fine day on the stock market in order that I might make my way back into our autumn cool. Breathe in through the nostrils.

Perhaps blue smoke will trail in wisps out of the red-brick chimneys of Old Town tonight, where we live and work? I hope so.

Maybe read some Frost? And warm socks tonight.

Fool on.

-- David Gardner, September 22, 1999






Rule Breaker Portfolio

9/22/99 Closing Numbers
Ticker Company Dly Pr Chg Price
AMGNAMGEN INC3/16$83.88
AMZNAMAZON.COM3/4$66.00
AOLAMERICA ONLINE1/8$91.00
ATHMAT HOME CORP CL A21/32$38.31
CATCATERPILLAR INC5/16$56.19
CHVCHEVRON CORP-1/8$89.63
DDDU PONT (EI) DE NEMOURS7/8$62.31
EBAYEBAY INC1/2$149.13
GTGOODYEAR TIRE & RUBBER CO-1 7/8$45.44
IOMIOMEGA CORP-1/8$3.13
SBUXSTARBUCKS CORP1/2$21.00
TDFX3DFX INTERACTIVE-5/32$8.03

  Day Week Month Year
To Date
Since
8/5/94
Annualized
Rule Breaker 4.94% 2.65% 1.48% 17.39% 1,080.49% 61.75%
S&P 500 .22% -1.87% -.75% 6.61% 185.89% 22.71%
S&P 500(DA) .22% -1.87% -.75% 7.19% 200.15% 23.88%
NASDAQ 1.31% -.40% 4.34% 30.35% 296.87% 30.80%

Trade Date # Shares Ticker Cost/Share Price LT % Val Chg
8/5/942200AOL0.917$91.009,822.58%
9/9/972640AMZN3.188$66.001,970.58%
5/17/951960IOM1.280$3.13144.06%
12/16/98580AMGN42.889$83.8895.56%
2/26/99300EBAY100.527$149.1348.34%
12/4/98900ATHM28.040$38.3136.63%
2/23/99300CAT46.964$56.1919.64%
2/23/99180CHV79.169$89.6313.21%
2/20/98260DD58.844$62.315.89%
2/23/99290GT48.715$45.44-6.73%
7/2/98470SBUX27.955$21.00-24.88%
1/8/98425TDFX25.667$8.03-68.71%

Trade Date # Shares Ticker Cost Value LT $ Val Ch
8/5/942200AOL$2,017.62$200,200.00$198,182.40
9/9/972640AMZN$8,415.03$174,240.00$165,825.00
12/16/98580AMGN$24,875.50$48,647.50$23,772.00
2/26/99300EBAY$30,158.00$44,737.50$14,579.50
12/4/98900ATHM$25,236.13$34,481.25$9,245.13
5/17/951960IOM$2,509.63$6,125.00$3,615.37
2/23/99300CAT$14,089.25$16,856.25$2,767.00
2/23/99180CHV$14,250.50$16,132.50$1,882.00
2/20/98260DD$15,299.44$16,201.25$901.81
2/23/99290GT$14,127.38$13,176.88($950.50)
7/2/98470SBUX$13,138.63$9,870.00($3,268.63)
1/8/98425TDFX$10,908.63$3,413.28($7,495.34)
  Cash: $5,954.23  
  Total: $590,035.60  



Note
The Fool Portfolio was launched on August 5, 1994, with $50,000. It was renamed the Rule Breaker Portfolio in October 1998. The investing strategy began with the first investments of the Fool Port and has evolved with time and experience. In July 2001, the portfolio began adding $12,500 each quarter (We missed Jan. 2002, so we added $25,000 in April 2002). We skip a quarter if we have enough uninvested cash or cash available in stocks we would prefer to sell to make new investments. All transactions are shared and explained publicly before being made, and returns are compared in each week's column to the S&P 500 (including dividends where noted) and the Nasdaq composite. For a history of all transactions, please click here.