Model Portfolio Performance
We are committed to having as complete disclosure of the performance of the Biotech Stock Research LLC (BSR) Model Portfolio as possible. However, we have to balance that commitment with the recognition the Model Portfolio is a large part of what our Subscribers are paying for.
What we have decided to do is provide only the bottom line comparison figures for the performance of the BSR Model Portfolio. The specific companies that populate the portfolio and their relative weightings are for Subscribers only.
The other hard part about disclosing performance is what to measure. We firmly believe the best indication of a portfolio's performance is by measuring it from the date of its inception. This is the only way to gauge the true ability (or lack of ability) of the team creating the portfolio. The table appearing immediately below is the performance for the BSR Model Portfolio from its inception August 27, 2001 to the "as of" date listed. The indices are also listed over the same time period for comparison purposes.
Subscribers can see additional details including current positions and transaction history by clicking here.
To compete as a business, we must provide you information that allows you to compare our performance with the performance of others. Few teams disclose performance over the life of the portfolio, but they are fond of disclosing year-to-date performance. We share our year-to-date performance of the BSR Model Portfolio for 2008 to the "as of" date indicated.
The following chart shows the performance of the BSR Model Portfolio for 2007.
The following chart shows the performance of the BSR Model Portfolio for 2006.
The following chart shows the performance of the BSR Model Portfolio for 2005.
The following chart shows the performance of the BSR Model Portfolio for 2004.
The following chart shows the performance of the BSR Model Portfolio for 2003.
The following chart shows the performance of the BSR Model Portfolio for 2002.
We should note that past performance -- however it is calculated -- is not always a good predictor of future returns. In addition, these returns are not audited by any independent agency. Finally, and importantly, they do not account for trading fees or income taxes incurred.
Yearly performance charts provide a completely different (and potentially inaccurate, in our view) picture of performance since the components of the portfolio are re-valued according to their price at the beginning of the year measured.
For example, assume we're calculating performance for calendar year 2002. The portfolio added stock XXYZ at $23/share in June of 2001. By the close on December 31, 2001, the stock had fallen to $5/share. At the close on December 31, 2002, the stock was trading at $10/share. The real performance of XXYZ in the portfolio at the end of 2002 was a dismal -56.52%. However, just taking a snapshot of 2002 would suggest the portfolio managers were actually up 100% in XXYZ. Why? To measure 2002 performance the cost basis of XXYZ was adjusted ("marked to market") at where it opened trading for that year.
Those who defend this way of looking at performance note this can cut both ways as a stock finishing positive in a particular year has its basis increase for the following year. This is correct, but we still believe showing performance over the life of the portfolio is the most accurate representation.
Because our customer universe is always changing, we traditionally rebalanced the portfolios each January during the mark-to-market process. Since our rankings are dollar weighted, the number of shares would reset depending on where the stock was trading on January 1st. This mimics the performance a new Subscriber would see if they bought our Model Portfolio according to our dollar weightings on January 1 of each year. Beginning in January 1, 2006, we changed this approach because of our increased use of options on the Model Portfolio leads to some disconnects.
What we have decided to do is provide only the bottom line comparison figures for the performance of the BSR Model Portfolio. The specific companies that populate the portfolio and their relative weightings are for Subscribers only.
The other hard part about disclosing performance is what to measure. We firmly believe the best indication of a portfolio's performance is by measuring it from the date of its inception. This is the only way to gauge the true ability (or lack of ability) of the team creating the portfolio. The table appearing immediately below is the performance for the BSR Model Portfolio from its inception August 27, 2001 to the "as of" date listed. The indices are also listed over the same time period for comparison purposes.
Subscribers can see additional details including current positions and transaction history by clicking here.
| Overall Performance Comparisons 2001-present | |
| (as of 2/1/2008) | |
| BSR Model Portfolio | + 23.56% |
| NASDAQ Biotech Index | - 9.23% |
| AMEX Biotech Index | + 38.31% |
| NASDAQ Composite Index | + 26.20% |
| S&P-500 Index | + 17.82% |
| Russell 2000 Small Cap Index | + 52.61% |
| Dow Jones Industrial Average | + 22.74% |
| Measured from start date 08/27/2001 | |
To compete as a business, we must provide you information that allows you to compare our performance with the performance of others. Few teams disclose performance over the life of the portfolio, but they are fond of disclosing year-to-date performance. We share our year-to-date performance of the BSR Model Portfolio for 2008 to the "as of" date indicated.
| 2008 Performance Comparisons | |
| (as of 02/01/2008) | |
| BSR Model Portfolio | - 3.85% |
| NASDAQ Biotech Index | - 1.56% |
| AMEX Biotech Index | - 3.30% |
| NASDAQ Composite Index | - 9.01% |
| S&P-500 Index | - 4.97% |
| Russell 2000 Small Cap Index | - 4.57% |
| Dow Jones Industrial Average | - 3.94% |
| Measured from close 12/31/2007 | |
The following chart shows the performance of the BSR Model Portfolio for 2007.
| 2007 Performance Comparisons | |
| BSR Model Portfolio | + 11.11% |
| NASDAQ Biotech Index | + 4.64% |
| AMEX Biotech Index | + 4.38% |
| NASDAQ Composite Index | + 9.81% |
| S&P-500 Index | + 3.53% |
| Russell 2000 Small Cap Index | - 2.79% |
| Dow Jones Industrial Average | + 6.44% |
| Measured from January 1, 2007 to December 31, 2007 | |
The following chart shows the performance of the BSR Model Portfolio for 2006.
| 2006 Performance Comparisons | |
| BSR Model Portfolio | - 1.60% |
| NASDAQ Biotech Index | + 1.01% |
| AMEX Biotech Index | + 10.72% |
| NASDAQ Composite Index | + 9.52% |
| S&P-500 Index | + 13.62% |
| Russell 2000 Small Cap Index | + 17.09% |
| Dow Jones Industrial Average | + 16.28% |
| Measured from January 1, 2006 to December 31, 2006 | |
The following chart shows the performance of the BSR Model Portfolio for 2005.
| 2005 Performance Comparisons | |
| BSR Model Portfolio | +0.21% |
| NASDAQ Biotech Index | +6.33% |
| AMEX Biotech Index | +27.05% |
| NASDAQ Composite Index | +3.62% |
| S&P-500 Index | +5.05% |
| Russell 2000 Small Cap Index | +6.49% |
| Dow Jones Industrial Average | +1.66% |
| Measured from January 1, 2005 to December 31, 2005 | |
The following chart shows the performance of the BSR Model Portfolio for 2004.
| 2004 Performance Comparisons | |
| BSR Model Portfolio | -14.64% |
| NASDAQ Biotech Index | +2.62% |
| AMEX Biotech Index | +9.39% |
| NASDAQ Composite Index | +6.24% |
| S&P-500 Index | +6.83% |
| Russell 2000 Small Cap Index | +13.46% |
| Dow Jones Industrial Average | +0.85% |
| Measured from January 1, 2004 to December 31, 2004 | |
The following chart shows the performance of the BSR Model Portfolio for 2003.
| 2003 Performance Comparisons | |
| BSR Model Portfolio | +88.69% |
| NASDAQ Biotech Index | +44.97% |
| AMEX Biotech Index | +45.72% |
| NASDAQ Composite Index | +49.93% |
| S&P-500 Index | +26.36% |
| Russell 2000 Small Cap Index | +45.43% |
| Dow Jones Industrial Average | +25.32% |
| Measured from January 1, 2003 to December 31, 2003 | |
The following chart shows the performance of the BSR Model Portfolio for 2002.
| 2002 Performance Comparisons | |
| BSR Model Portfolio | +5.66% |
| NASDAQ Biotech Index | -45.54% |
| AMEX Biotech Index | -41.82% |
| NASDAQ Composite Index | -31.49% |
| S&P-500 Index | -23.34% |
| Russell 2000 Small Cap Index | -21.68% |
| Dow Jones Industrial Average | -16.76% |
| Measured from January 1, 2002 to December 31, 2002 | |
We should note that past performance -- however it is calculated -- is not always a good predictor of future returns. In addition, these returns are not audited by any independent agency. Finally, and importantly, they do not account for trading fees or income taxes incurred.
Yearly performance charts provide a completely different (and potentially inaccurate, in our view) picture of performance since the components of the portfolio are re-valued according to their price at the beginning of the year measured.
For example, assume we're calculating performance for calendar year 2002. The portfolio added stock XXYZ at $23/share in June of 2001. By the close on December 31, 2001, the stock had fallen to $5/share. At the close on December 31, 2002, the stock was trading at $10/share. The real performance of XXYZ in the portfolio at the end of 2002 was a dismal -56.52%. However, just taking a snapshot of 2002 would suggest the portfolio managers were actually up 100% in XXYZ. Why? To measure 2002 performance the cost basis of XXYZ was adjusted ("marked to market") at where it opened trading for that year.
Those who defend this way of looking at performance note this can cut both ways as a stock finishing positive in a particular year has its basis increase for the following year. This is correct, but we still believe showing performance over the life of the portfolio is the most accurate representation.
Because our customer universe is always changing, we traditionally rebalanced the portfolios each January during the mark-to-market process. Since our rankings are dollar weighted, the number of shares would reset depending on where the stock was trading on January 1st. This mimics the performance a new Subscriber would see if they bought our Model Portfolio according to our dollar weightings on January 1 of each year. Beginning in January 1, 2006, we changed this approach because of our increased use of options on the Model Portfolio leads to some disconnects.
| The Biotech Stock Research LCC Model Portfolio is for illustration and discussion purposes only. It is not intended as investment advice nor is it a solicitation or offer to transact in the securities listed. Figures presented are based solely upon hypothetical results and do not reflect any actual managed investment account. Please see your financial advisor or tax professional before making any investment. This Model Portfolio is calculated according to varying dollar figures indicated when the portfolio addition is made plus subsequent additions or subtractions. The BSR Model Portfolio performance numbers do not include dividends, trading costs, interest earned, or taxes and are calculated as indicated in the discussions above. Returns on the S&P-500 Index, NASDAQ Index, AMEX Biotech Index, Dow Jones Industrial Average, and Russell 2000 Small Cap Index are also calculated as noted above and do not include dividends, trading costs, or taxes. Full details, including a complete transaction history, are available to BSR Subscribers at this link and by request from current single-issue purchasers made to any of the contact methods listed here. |
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