Rule Breaker Port to Sell Foolish Four Holdings
February 24, 2000

**This trade is being made under the regular portfolio policy, namely, once the Fool announces an intention to trade, that trade will be made within the next five trading days. For more detail, please read the New Trades section of the Rule Breaker Portfolio.**

At some point in the next five market days, the Rule Breaker Portfolio will SELL

  • 300 shares of Caterpillar (NYSE: CAT)
  • 180 shares of Chevron (NYSE: CHV)
  • 260 shares of DuPont (NYSE: DD)
  • 290 shares of Goodyear Tire (NYSE: GT)

    Transaction Stats:
    On March 3, 2000, the RB Port sold its 300 shares of Caterpillar at $34 11/16; its 180 shares of Chevron at $75 11/16; its 260 shares of DuPont at $47 7/8; and its 290 shares of Goodyear at $22 1/4. Each trade cost $8 in online trading commissions, for a total of $32 in commissions.

    Farewell Four Friends

    The Rule Breaker Portfolio will sell its Foolish Four holdings sometime in the next five market days, as it has done every 12 months. This time, however, we will not replace the stocks sold with the new, updated group of Foolish Four stocks as the Foolish Four system dictates.

    Why not? For a few simple reasons.

    First, the Fool now has, and has had for 14 months, a real-money Foolish Four Portfolio that covers this investment strategy comprehensively, describing several variations of the strategy while offering a daily column as well. Given this extensive offering, we no longer feel the need to demonstrate the strategy in the Rule Breaker Portfolio. It has become redundant.

    This leads us to our second reason for selling the holdings: We want to focus entirely on Rule Breakers! The BreakerPort is happy to free up some money (about $40,000 with these sales) to invest in new Rule Breakers. So, from here on the Rule Breaker Port will focus only on Rule Breakers, just as the Rule Maker Port focuses only on Rule Makers, and the Fool Four Port buys only... you got it, the Foolish Four.

    Some Fools may ask, "But isn't the Fool Four a good foundation for any portfolio?"

    Our opinion hasn't changed. We believe that it can be. However, in the case of the aggressive BreakerPort, our best Breaker investments have grown so much that the relevance of the Foolish Four holdings in our portfolio has been greatly diminished. We suspect that this trend would only continue over the years, so we're nipping it in the bud.

    The reasons for this sale are explained in more detail in a Rule Breaker column from February 17, 2000. That column was titled A Pure Rule Breaker Port. Please see that link for more explanation of this sale and visit the Rule Breaker boards (linked on that page) if you wish to discuss this trade.

    Fool on!