Hulbert Financial Digest Investment Newsletter Honor Roll for the sixth year in a row!

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“Stock buybacks are the simplest and best way a company can reward its investors.”  legendary investor Peter Lynch.

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We're on Hulbert's 2015 Honor Roll !

The Buyback Letter was named to The Hulbert Financial Digest 2015 Investment Newsletter Honor Roll for the sixth year in a row! There were only 12 that made the Honor Roll. To be in this select group, a newsletter must exhibit above-average performance in both up AND down markets. Just 16% of the newsletters that Hulbert monitors made it to the honor roll.

 

 

"David Fried's Buyback Letter is one of the best in the business. He makes money for subscribers year-in and year-out, in up and down markets, with honesty, integrity and consistency." - Jeffrey A. Hirsch, Stock Trader's Almanac


Remember to invest
for the future — it will be here before you know it.











 
 
User's Guide - Standard Edition
 

The Buyback Letter, a monthly online newsletter, is the only publication devoted to investing in companies that buy back their own stock. Editor David Fried’s exclusive research, evaluation and recommendations of buyback stocks put his subscribers at the head of the investing pack. All six of the portfolios we present in the newsletter are beating their benchmarks since inception. If fact, the Hulbert Financial Digest ranked The Buyback Letter #1 for risk-adjusted returns among stock-picking newsletters and #2 among all newsletters for the five-year period ending 12/31/2001, and it continues to rank in the Top 10 newsletters. The Hulbert Financial Digest named the Buyback Letter to it's honor roll in 2011, 2012 and 2013! We’re very proud of this ranking and will work hard to continue to earn it.


Please read the information below to learn how to get the most out of your subscription, and save it for future reference. Areas covered include:
  1. How to get your current issue now
  2. What is the Buyback strategy?
  3. The Buyback Letter explained
  4. How to get started
  5. Choosing which portfolio is right for you
  6. What else is on the web site for you?
  7. Subscription details
  8. Access to the editor

Each month The Buyback Newsletter is generally available by the 7th of the month at http://www.buybackletter.com/Members/. You will be notified by e-mail when the new edition is posted. Additionally, you will receive regular e-mail updates with trading instructions, our weekly sentiment readings and other pertinent information. These messages will be self-contained, and will not require you to visit the web site. You may cancel at any time.


2. What is the Buyback strategy?

David Fried created the Buyback strategy after he discovered the market-beating value of buying stock in select companies that are repurchasing their stock. By investing in these companies, you are putting the powerful forces of supply and demand to work in your favor. When a company buys back its own stock, it reduces the number of shares outstanding, which gives each remaining shareholder a larger percentage of ownership in the company. This often results in lower price/sales, price/earnings and price/cash flow ratios for a company’s stock, which then can lead to higher share prices and better-than-average returns.

Our quantitatively based, disciplined investing strategy is based on examining hundreds of buybacks with low risk but the potential for high returns. We start by tracking all major corporate buyback announcements. Next, he makes sure these companies actually buy back a significant number of shares (a surprisingly large number do not), so the buyback has a real impact on the value of the stock. If a stock meets all of those criteria, Fried and his staff scrutinize the firm's financial strength, cash flow, management, prospects for growth, contracts and other crucial factors to ensure that the company is rock-solid and its shares are reasonably priced.

For us to recommend a company, the stock must have the potential to double in 2-4 years, a good business story, good management and a current buyback program already underway.

Only a handful of stocks meet these rigorous standards and are recommended in The Buyback Letter.


3. The Buyback Letter explained

On the Web site, you will see that the newsletter is broken into segments, for easy viewing. You may view the segments by clicking on each hyperlink separately, which allows you to focus on only those portfolios you are following, or you may view the newsletter in its entirety by clicking on the printer-friendly version link.

Each month in The Buyback Letter you'll find:

Performance and Trading Summary: If you want to head straight for the numbers, this is your spot to find the month’s results for all portfolios as measured against their benchmarks, plus historical performance. We’ll also remind you of hotline actions that occurred during the month.

Buyback Value-Index Portfolios: Fried has three carefully selected Buyback Value-Index Portfolios. You can view the stocks currently held in these portfolios, and compare their returns against the S&P 500 and the DJIA. The following is a summary of these portfolios.

1. Buyback Dogs Portfolio®: One of our most popular portfolios, this five-stock portfolio features Dow Jones companies that have not only been most actively repurchasing their shares, but also boast excellent fundamentals. (The name is a play on “The Dogs of the Dow,” a strategy in which investors buy those DJIA companies with the lowest P/E ratios and highest dividend yields.) In our Buyback Dogs Portfolio, we are selecting Dow stocks that are cheapest relative to their peers on an overall fundamental basis, and are buying back stock.

2. The Buyback Index: A more diversified 20-stock portfolio that consists of broad market companies that have repurchased a significant amount of their shares recently.

3. Buyback Income Index: A 10-stock portfolio for those interested in income. It features buyback companies that also pay high dividends.

Buyback Sector-Index Portfolios: Two portfolios are presented that follow specific sectors of the market. You can view the stocks currently held in these portfolios, and compare their returns against the S&P 500 and the DJIA.

1. Buyback High-Tech Sector Portfolio®: A five-stock portfolio selected from the computer, software, electronics, semiconductor and telecommunication sectors of the market. We select five stocks that, as a group, have tremendous potential for appreciation.

2. Buyback Health & Bio-Tech Sector Portfolio: A five-stock portfolio selection from the drug, medical service, medical supply and medical equipment sectors of the market. We select five that, as a group, have tremendous potential for appreciation.

Buyback Hotlines: In addition to The Buyback Letter, which is posted monthly, we send out periodic e-mail Hotlines to our subscribers. These usually are sent weekly, but will be sent more often if market conditions dictate. Hotlines contain any new buy or sell recommendations for all of our portfolios, and a “sentiment indicator,” which is an average of investor sentiment readings from Investors Intelligence, Consensus Index, AAII Index and Market Vane. We use this tool as a guide for investing new funds into the market, not as a way to time the market. We do not advocate market timing since we know of no market timing systems that are reliable over time.

The current and prior Hotlines are also available on the web site near the newsletter links.
PDFs: As you navigate down on the Standard Edition page, you will see the Back Issues area where you can look up any prior issues. The most recent of them are also available in a PDF should you prefer that format.


4. How to get started  

We suggest the purchase of at least 20 stocks for a diversified investment. Consider purchasing two or three of our portfolios. Commit an equal dollar amount to each portfolio, and then buy equal dollar amounts of each stock held in the model portfolios that you have selected.

For example, you might choose our 20-stock Buyback Index®, a highly diversified portfolio of companies across the market. If you chose this option you would invest equal dollar amounts in all 20 stocks. Or try a combination of the 5-stock Buyback Dogs® portfolio, the 5-stock Buyback High-Tech Portfolio® and the 10-stock Buyback Income Index®, which would also give you 20 different stocks. (If you choose this option, you would invest 5.0% of your funds in each stock in the 10-stock Buyback Income Index®, while placing 5.0% of your funds in each stock in the 5-stock Buyback Dogs® portfolio and 5.0% of your funds in each stock in the 5-stock Buyback High-Tech Portfolio®
There are several other ways investors might choose to begin. Which you choose depends on your personality and goals. Please remember that the object is for you to generally model the percentage of your stock holdings by following our model portfolios. We realize that by following our advice to put an equal dollar amount into each stock in several portfolios, your percentages will naturally differ from ours in the models, since ours will reflect appreciation over time.

Whatever combinations of stocks you choose, we recommend that you buy all the stocks in a given model portfolio. For example, please do not cherry pick 2 stocks from one of the sector portfolios, and 3 stocks from the index fund, and ignore the rest in those model portfolios. This flawed technique will expose you to unacceptable risk. If you are going to model your holdings on a certain portfolio, please buy all the stocks in that portfolio.

No matter what technique you use, follow along with our Hotlines each month, buying and selling the stocks we recommend as we update the portfolios.


5. Choosing which portfolio is right for you    

Only you can determine how much money you are comfortable investing. Once you have decided that, when choosing from among our various options you also may wish to consider risk, how much trading activity we recommend in each portfolio and how long we generally hold the stocks, and the number of stocks in each portfolio.

Here’s a brief snapshot of each portfolio, for easy comparison. Keep in mind that figures are approximate and may vary over time:

The Buyback Dogs
No. of stocks: 5
Average annual turnover: 40%
Frequency of trading: Changes are made at the beginning of each month. Average of 3 trades a year.*
Investment style: This portfolio is designed for investors seeking appreciation through large cap growth.

Buyback Income Index
No. of stocks: 10
Average annual turnover: 30%
Frequency of trading: Changes are made as needed on an ongoing basis, usually 2-3 trades per year. *
Investment style: This portfolio is designed for investors seeking income and growth.

Buyback Index
No. of stocks: 20
Average annual turnover: 80%
Frequency of trading: Changes are made at the beginning of each quarter; there is 30%-35% turnover quarterly.*
Investment style: This portfolio is for growth investors who seek a diversified portfolio.

Buyback High-Tech Sector
No. of stocks: 5
Average annual turnover: 100%
Frequency of trading: Changes are made at the beginning of each quarter; there is about 60%-80% turnover each quarter.*
Trading style: This portfolio is for investors who seek aggressive growth.

Buyback Health & Bio-Tech Sector
No. of stocks: 5
Average annual turnover: 100%
Frequency of trading: Changes are made at the beginning of each quarter; there is about 60%-80% turnover each quarter.*
Trading style: This portfolio is for investors who seek aggressive growth.

*Stocks may be sold mid-month at the editor's discretion based on disappointing earnings or unexpected negative surprises. This allows us to get rid of stocks likely to be "dead money" or have further declines. Replacement stocks are selected using the same careful rules that we use for all stock selections.


6. What else is on the web site for you?

Buyback research: Be sure to read all of the free information available on the Buybackletter.com home page. This information is listed at the bottom of the page under the headline “The Buyback Advantage--Free Information on Buyback Stocks." The information contained in these reports will give you important insight and background so you can take full advantage of The Buyback Letter.


 

7. Subscription details

Remember, you can get the current issue at: http://www.buybackletter.com. You may wish to bookmark this page for quick reference.
If you have questions or comments regarding your Buyback Letter member account, please contact us at webmaster@buybackletter.com


8. Access to the editor

If you need help in trying to decide how to make the best use of the newsletter, feel free to call the editor, David Fried, at (310) 459-9196 or e-mail him at david@buybackletter.com. We are always glad to get your feedback and your suggestions on improving The Buyback Letter.

 

Thank you!
Thank you for selecting The Buyback Letter as a tool for your investment
decisions. Remember to invest in the future – it will be here before you know it.

The Buyback Letter
David Fried Enterprises, Inc.
http://www.buybackletter.com

 
 

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