In 1984 I launched my own investment publishing business with the first edition of Quantum Leap going out to a handful of subscribers in October 1984. The only stock profiled in that maiden issue was Body Shop International, the famous organic skin and beauty products business founded by Anita and Gordon Roddick. The shares rose 50-fold after I tipped them, which I have always regarded as a good omen for my subsequent career as a stock picker. It seemed the gods wanted to give me a sign that I had chosen wisely in what I wanted to do.
I believe investors managing their own investment portfolios want to make a lot of money, while taking a sensible level of risk. I am looking for stocks that go up a lot and the evidence strongly suggests that I am finding them. Unsurprisingly, my strategy works better in a bull market. If you look at My record you will see that the gains from the 1980s and 1990s are much larger than those achieved since 2000. There are two reasons for this. First, the earlier recommendations have had longer to perform. It takes time for shares to deliver really large gains. Secondly, the period between 1982 and 2000 saw an exceptionally powerful secular bull market in UK and US shares. Since 2000 the market has endured two ferocious bear markets and even now is barely better than convalescent after the latest series of financial and economic shocks. Even so, I think I am still doing well. To see how my recommendations have performed recently, click here.
A key element in Quantum Leap is that its success is not dependent on second-guessing what the whole stock market is going to do. In the very long term it goes up, which helps, but in the shorter term anything can happen. I am actually quite good at spotting the onset of periods of weakness and periods of strength, popularly known as bear and bull markets. For instance, I was extremely bullish in the early 1980s, at the onset of a fabulous long-running bull market, which saw the US NASDAQ index rise 50-fold driven in particular by dramatic gains in technology shares. The FTSE All Share index rose 52-fold between 1974 and 2000, with most of those gains coming after 1982. I also turned very cautious in the autumn of 2007.
It is not crucial to the case for subscribing to Quantum Leap but I am very bullish now. In 1982, the global economy was in the early, stuttering stages of recovery from a deep recession. Just as now economists spoke of a 'jobless recovery' with unemployment remaining stubbornly high as we start to recover from a deep recession between 2008 and 2009. There is another extraordinary parallel. In 1982, the US Dow Jones index was trading at around 950. This was the same level first reached 17 years earlier in 1965. This extended period of sideways trading was the spring board for the long-running bull market that followed. A similar thing happened in the 1930s, when shares traded sideways until 1950 before embarking on the famous 'cult of the equity' bull market between 1950 and 1965, when share prices quintupled. This was achieved against a background of low inflation so in real (inflation-adjusted) terms it was an impressive performance laying the ground work for the vast fortunes accumulated by investors like Warren Buffet.
Now, consider the present position. Key indices like the Dow Jones and the UK's FTSE All Share index are trading close to levels first achieved around 13 years ago. This is extraordinary if you consider what has happened over that period. The growth in emerging markets has proceeded to the point where China alone has become a key driver of trends in the global economy. At the same time technology and globalisation have opened world markets, even to relatively tiny companies. Whereas, 25 years ago, the market for an ambitious UK growth company was largely confined to some 50m people living in the UK, now the world is their oyster. A reasonable guesstimate is that there are at least three billion increasingly prosperous consumers in capitalist nations around the globe available as targets for your goods and services.
I believe that we could be, indeed probably are, on the brink of a new long-running bull market in global stock markets, including those of the UK and USA. You may not feel very bullish. The newspapers are full of doom and gloom with pundits anxious about high levels of indebtedness for countries and individuals and worried about a renewed economic slowdown, the feared second dip of a double-dip recession. Paradoxically this nervousness is bullish. History strongly suggests that bull markets begin not when everybody is bursting with optimism but when investors are fearful and cautious, just like now. Last but not least of the factors making me so optimistic on the medium and longer-term outlook is the quality and potential I am seeing right now in so many individual companies. I am spoiled for choice in the number of exciting shares that I am finding to recommend in Quantum Leap. The position is reminiscent of the early 1990s, another great time for buying shares.
In summary, my long term record as a stock picker is good, I am doing well right now, beating the indices by miles and I think we could be on the brink of an exciting new bull market, a real one, not just a recovery from the lows, which is what we have had so far. What should you be doing? Very simple. You should be building a portfolio of first class shares to deliver potentially dramatic capital gains over the coming years. I think Quantum Leap is the ideal publication to help you do this. I am biased, of course but I really think you should subscribe. It is a lovely feeling making money in the stock market.
Don't delay. Go for it and sign up now while these comments are fresh in your mind. Investing with good advice, can be a lot of fun, especially if a huge new bull market is just around the corner.