Fool Portfolio Report
Friday, November 3, 1995

Tom and I have talked about it, and we're now thinking of retiring to the Caribbean. You know, give up this online gig. Cash out of our America Online, our Ride, our Iomega, our surging semiconductor stocks (OK, and our Sonic too) and just forget about ambition, duty, meaning, existence.

The past week was that good.

A check of our total return through last Friday showed 72.75%. Five trading days later, we're sporting a somewhat gaudier 87.23% return, dated from the online genesis of Foolishness on August 5th, 1994. Over the same period, the S&P 500 has put up gains of 28.83%. The perspective that I sometimes lose, but one always worth remembering, is that MOST mutual funds and money managers are LOSING to the S&P 500 over that period. Most are probably not even up 25%, including many of your acquaintances and mine, whose money is mired in the mutual-fund morass.

Then there are short sellers, money managers who spend all their time playing the market for a drop. They're losing lots for their customers, as the Wall Street Journal detailed in an article earlier this week. We enjoy shorting (although fortunately we didn't add any shorts to the portfolio this summer), but why would ANYONE ever want to go WHOLE-HOG into shorting the market? There is too much ongoing upside. Our eternal Foolish allocation, which you can read about in our Fool's School, talks about aggressive Foolish investors maintaining some short positions but keeping them to never more than 20% of their portfolio, and cashing out of any short positions that have lost them 20% 20% on their investment. Investors who short the market have had a bad run in 1995, reminding us all of the importance of keeping the vast majority of our money invested long, and Foolishly.

Friday came with its own assortment of splendid moves, as America Online rose $1 7/8 to an all-time closing high of $87, Applied Materials jumped $2 5/8 to $55 1/8 (within two points of our cost), and KLA Instruments scored a $3 3/4 gain, putting us back in the black again. For the week, these stocks were even better, as you can see below. In fact, it was such a stellar week that I want to list the five-day moves for all 10 of our stocks (ordered by historic total return):

America Online up $12 3/4 to $78
Ride Inc. down $1/8 to $23 1/2
Iomega Corp. up $1 3/8 to $24 5/8
Sears up $1 7/8 to $35 7/8
The Gap up $4 5/8 to $41 7/8
GE up $1/2 to $62 3/4
Chevron up $1 5/8 to $47 7/8
KLA Instrument up $4 3/4 to 46 1/2
Applied Materials up $6 3/8 to $55 1/8
Sonic Solutions down $3/8 to $7 3/4

The most spirited moves came from America Online and The Gap. America Online had a banner week, including the introduction of its new GNN Internet-only service, its showing at the Internet World convention in Boston, its annual meeting, and the announcement of its 2-for-1 stock split. AMER closed within $3/8 of becoming our first six-bagger, Friday. The Gap soared on a strong same-store sales report in October, moving from a return of 14% overall to a 29% total return in just one week. And The Gap is supposed to be one of those dull, lumbering multibillion-dollar giants!

Anyway, I have looked into the possibility of air tickets to the Caribbean and they look pretty booked up for now. So we probably aren't going to leave our online digs anytime soon. In fact, we're having far more fun than should be allowed. We hope that you too, dear reader, are enjoying signing into the Motley Fool on a daily basis and have found something here in the online world that you can point to and say, "That was worth buying my 28,800-baud modem for."

(Anyone else see that advertising screen that AOL put in our faces before signing on today?)

Folly forever.

---David Gardner, November 3, 1995


Today's Moves

AMER +1 7/8 AMAT +2 5/8 CHV + 1/2 GE - 1/2 GPS - 3/8 IOMG + 1/2 KLAC +3 3/4 RIDE - 1/8 S - 1/4 SNIC ---

Today's Numbers

Day Month Year History FOOL +1.52% 4.55% 68.63% 87.23% S&P 500 +0.14% 1.56% 28.59% 28.83% NASDAQ +0.79% 2.86% 41.72% 47.97% Rec'd # Security In At Now Change 8/5/94 340 AmOnline 14.55 87.00 498.11% 5/23/95 510 Ride Inc. 9.91 23.50 137.21% 5/17/95 335 Iomega Corp 15.11 24.63 62.93% 4/20/95 155 The Gap 32.55 41.88 28.65% 8/5/94 165 Sears 28.93 35.88 24.03% 8/11/95 95 GenElec 57.91 62.75 8.35% 8/24/95 130 KLA Instrm 44.71 46.50 4.00% 8/11/95 110 Chevron 49.00 47.88 -2.30% 8/24/95 100 AppldMatl 57.52 55.13 -4.17% 12/23/94 340 SonicSol 14.48 7.75 -46.49% Rec'd # Security Cost Value Change 8/5/94 340 AmOnline 4945.56 29580.00 $24634.44 5/23/95 510 Ride Inc. 5052.44 11985.00 $6932.56 5/17/95 335 Iomega Corp 5063.13 8249.38 $3186.25 4/20/95 155 The Gap 5045.25 6490.63 $1445.38 8/5/94 165 Sears 4772.65 5919.38 $1146.73 8/11/95 95 GenElec 5501.87 5961.25 $459.38 8/24/95130 KLA Instrm 5812.49 6045.00 $232.51 8/11/95 110 Chevron 5389.99 5266.25 -$123.74 8/24/95 100 AppldMatl 5752.49 5512.50 -$239.99 12/23/94 340 SonicSol 4924.18 2635.00 -$2289.18 CASH $5969.86 TOTAL $93614.24