3 Hot Tips From a Proven Winner

If Warren Buffett jumped off a cliff, would you follow him blindly?

Of course you wouldn't, but you could certainly do a lot worse than following in the footsteps of a winner like Buffett.

On Motley Fool CAPS, there is an ample supply of winning investors who are sharing entire portfolios with the world. Today, I'm looking at all-star CAPS member StatsGeek, who rarely makes a false market move. Currently ranked No. 38 out of over 70,000 CAPS members, StatsGeek has an uncanny 83.2% pick accuracy among 1,770 recommendations. Nobody is right all the time, but this player comes close.

What's going on here?
Most of StatsGeek's very best CAPS picks have been bullish bets on mining companies. Silver Wheaton and Ivanhoe Mines are the best performers on his scorecard. Mining isn't this player's only area of expertise, of course -- a well-timed outperform call on gadget guru Apple is another top scorer here.

But that's looking in the rearview mirror -- what I want to know is how this proven master investor would invest now. So here's a handful of StatsGeek's latest CAPS picks:

Remember the old adage about jumping off a cliff? The same thing applies here: Just because StatsGeek says a stock will or won't beat the market doesn't make it so. Rather than taking this as a buy-or-sell list, let's look a bit deeper as a starting point for your own research.

Damning with faint praise
Rating a security "outperform" doesn't necessarily make you a market bull. StatsGeek went on a rampage last month, giving thumbs-up ratings to seven sector-specific bearish ETF securities, of which UltraShort Financials is just one example. With wide-ranging negative bets covering real estate, semiconductors, industrial stocks, and mid-cap stocks in general, it's safe to say that StatsGeek sees the market going down hard, and they're all five-year predictions.

If you're going to take a negative position on any particular sector, the broad brushstrokes of a sector-focused ETF could be the way to go. You don't have to pick particular winners and losers in the field you're looking at, but still get to take action on particular market trends. This philosophy goes well with StatGeek's stated investing philosophy: "Big sector bets will mess ya up eventually."

It's also easier to buy single stocks than shorting them, given the inherent risks of short-selling and the multifaceted assumptions you have to make when buying put options or writing calls. So if you, like StatsGeek, think that the semiconductor industry is headed for a fall, go ahead and find the appropriate bearish sector fund. But if you're like me, and think that chip stocks are on their way up, you would be happier investing in Intel directly. Pick your battles, Fool.

Google this!
Indeed, StatsGeek seems to agree with me in terms of overall strategy. He thinks that Google is a great investment on its own, and I heartily agree. The undisputed leader in online search and advertising is only getting started in new businesses like smartphones with mobile connectivity, TV advertising, electric cars -- you name it and Google is probably thinking about it. Hard.

When we look back on 2010 from the year 2020, we shall hardly recognize today's online-only little business when we look at the then-contemporary Google stretching into every facet of modern life. But for starters, it's comforting to know that Google's heart is in the right place even as its head is going places you'd never expect. I'm in for the very long haul, warts and all.

Choking on a BlackBerry
Finally, StatsGeek feels confident that Research In Motion is overvalued today. Fellow all-star CAPS player QualityPicks outlines one possible explanation: "People are slowly abandoning blackberries in favor of iPhones."

Me, I have a slightly different idea of what's going on. The BlackBerry is still holding up all right in the market, though iPhones and Google Androids are catching up in the long run. But RIM's stock is priced as if the competition was choking on BlackBerries and about to die. The Canadians will be around for a long time, but the inflated share price might not. Besides, if you want to invest in smartphone stocks, you don't have to pick the low-hanging fruit every time.

What do we do now?
There are hundreds more stock picks on StatsGeek's roster, and then hundreds of other top-notch investors sharing their secrets on CAPS. I suggest that you grab a free CAPS account and dive in on your own. Find your own favorite CAPS members, copy their best strategies, and add your own special sauce -- and maybe next time, I'll write about following in your footsteps.