Mr. Market proved no match for Apple (Nasdaq: AAPL) and Google (Nasdaq: GOOG) as week 33 saw the Big Idea Portfolio reclaim a double-digit lead over the S&P 500 index, the first I've had in three months. I'm going head-to-head with the index in a three-year showdown to see who's better at producing returns for investors:


Starting Price*

Recent Price

Total Return

Rackspace Hosting$41.65$55.8133.9%
Riverbed Technology$25.95$21.09(18.7%)$100.93$147.2345.9%
S&P 500 SPDR$126.50**$142.1812.39%

Source: Yahoo! Finance.
*Tracking began at market close on Jan. 6, 2012.
**Adjusted for dividends and other returns of capital.

So far, so good, but the markets aren't making my job easy. All four indexes ended last week higher, for the fifth consecutive week, led by the small-cap Russell 2000, which closed up 2.29%. Both the S&P 500 and Dow Jones Industrial managed gains, rising 0.87% and 0.51%, respectively, but only the tech-heavy Nasdaq came close to the Russell's return. Big gains by Apple, Google, and other Silicon Valley heavyweights led the Nasdaq Composite up 1.84% for the week, CNBC reports.

Notable newsmakers
More than anything else, optimism appears to be fueling the rally. The Chicago Board of Exchange's Volatility Index, or VIX, widely considered the best gauge of fear in the stock market, fell another 8.6% and is now off more than 42% year to date. At 13.47, the VIX now sits at a five-year low, CNBC reports.

And that's in spite of worrying news from some parts of the tech world. Facebook (Nasdaq: FB) finished the week down 12% after some early investors were freed from selling restrictions. Volume soared on Thursday and Friday as selling turned to dumping.

Facebook shares fell more than 4% on Friday alone, hurting thousands of employees, IPO investors, and Netflix (Nasdaq: NFLX) founder Reed Hastings, who also happens to be a board member. He recently purchased 48,000 shares at around $21 apiece. My Foolish colleagues Anders Bylund and Rick Munarriz have dueling opinions over whether this amounts to a legitimate buy signal. I'm more inclined to agree with Rick, who thinks Hastings made a smart buy, since Facebook is an active Motley Fool Rule Breakers recommendation.

On Friday, Groupon (Nasdaq: GRPN) touched a 52-week low of $4.51 a share after the company failed to meet second-quarter revenue targets. Separately, an analyst at Evercore Partners downgraded the stock to "sell" on concerns that rising expenses would damage Groupon's pristine balance sheet -- blessed with more than $1.2 billion in net cash -- sooner than expected. I've been bearish on the daily deals supplier for some time now, but I'd be lying if I said I knew the stock would suffer a freefall this quickly.

Finally, both Apple and Google rallied, but for different reasons. The search king soared on cost-cutting news. Management is laying off some 4,000 workers from its Motorola Mobility unit. A smaller division may divest interests in set-top boxes and concentrate on developing smartphones and tablets. Google also spent a reported $25 million to acquire the Frommer's guides in what appears to be an effort to get more of us searching the site for travel information.

Apple rose as speculation over its TV plans continued. The Wall Street Journal reports the company is in talks with cable providers about pumping live TV feeds through its set-top boxes. The next day, Jefferies & Co. raised its price target for the stock from $800 to $900 per share. Oh, and the Mac maker paid out its first cash dividend in 17 years. (You can see the impact in the adjusted starting price for my Apple position in the table above.)

What are you buying now?
As much as Apple is driving gains for the Big Idea portfolio so far, there's still a lot we don't know about the company's long-term strategy to own tablets or even TVs. That's why we've introduced a new premium Apple research service with a kick-off report that details the opportunities and challenges in store for shareholders. The research includes a full year of updates, but only if you act now. Get your copy today.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.