<FOOLISH FOUR PORTFOLIO>

Tracking Your Portfolio
Have we got a deal for you!

by Ann Coleman
([email protected])

Reston, VA (December 16, 1998) -- One reason we are going through this step-by-step process of buying our new Foolish Four stocks in such a public way is that many people have expressed an interest in mirroring our portfolio.

That worried me. After all, the Motley Fool, this portfolio included, is here to teach people how to make their own investing decisions. Then I realized that many, if not most, of the people who wanted to duplicate our portfolio were perfectly aware that they could buy before or after we did and it probably wouldn't make much difference. They wanted to duplicate our stocks because they liked the idea of being able to click in here every night and see how "their" stocks did. That's cool. And certainly watching one's investments go up (when they go up!) is one of the more fun aspects of investing. I welcome the chance for us to do it together -- whichever way it goes next year... and the next.

However, not everyone wants to duplicate our portfolio (good for you!), and some who do won't be able to for various reasons. It's not that easy to match prices exactly, for one thing.

Have we got a deal for you! Our new My Portfolio area (AOLers: click the blue link. Webbers: look up.) will let you set up your very own Foolish Four portfolio (and many others if you like) and track it every day all year long.

Today's step (you do already have the paperwork in the mail if you need to set up a brokerage account, right?) is to learn how to set up and track a portfolio online. There are lots of places where you can do that, but if you want to use our version (please!), you can do so by simply registering a name and e-mail address with us (so we'll know know which portfolio is yours).

It's quick, easy, and free. Just click where it says Register. (If you don't see the word Register when you are on our website but do see My Fool on the tab bar, it means you are already logged on.)

All registered? Good, now all you have to do is go to My Portfolio and click on Create New. We will take you through the process of creating a portfolio. Don't be afraid to create a dummy portfolio for practice -- or a fantasy portfolio. My fantasy portfolio is 10,000 shares of Microsoft (Nasdaq: MSFT), 10,000 shares of Intel (Nasdaq: INTC) and 10,000 shares of Amazon.com (Nasdaq: AMZN) -- all purchased years ago at absurdly low prices, of course.

Your very own Foolish Four portfolio will give you a daily update on what your stocks are doing that day. The Long Term view will show you what they have done since you bought them. Yes, yes, of course, we list the performance of the Standard & Poor's 500 Index so you can see how your portfolio is doing relative to the market as a whole.

Speaking of how your portfolio is doing relative to the market as a whole, we've taken a drubbing these past two weeks! It's no fun watching your gains melt away as the market drops. That's one of the problems with all this wonderful information we have at our fingertips -- you get to see every bump and pothole on the road. Remember, though, the Foolish Four is a long-term strategy. An airplane view is probably much more appropriate. Ever fly over the Rockies? They look like a rumpled blanket from 35,000 feet.

I rarely write about the market's movement in this column for that very reason. I've looked at the long-term results and seen that there have been good years and bad years and sometimes there have been several years in a row when the market has beaten the strategy. This is likely to be such a year, and, if it is, it will be the second year in a row that the market has beaten both the Foolish Four and its RP variation.

Does this mean next year will be great? Heck, no! That's like betting heads will come up because the last four tosses have been tails. (You don't think that the past tosses influence the next toss, do you?) The correct way to bet is to bet that someone won't toss five heads in a row before he starts tossing. Those odds are in your favor. Odds for the next toss are always 50/50.

Here is a quick review of how the Foolish Four and the RP version of the Foolish Four have done over the last 15 years compared to the Dow and the S&P 500:

Year	Fool4	RP	Dow 30	S&P 500
1983	41.74%	36.72%	35.35%	22.51%
1984	10.24%	10.30%	-0.12%	6.27%
1985	22.85%	49.82%	30.98%	32.16%
1986	27.30%	29.67%	21.87%	18.47%
1987	18.75%	17.89%	15.93%	5.23%
1988	13.62%	22.08%	13.78%	16.81%
1989	15.28%	47.35%	31.95%	31.49%
1990	-17.61%	-17.61%	-9.14%	-3.17%
1991	81.61%	34.81%	30.36%	30.55%
1992	29.94%	29.94%	11.00%	7.67%
1993	26.22%	30.26%	17.91%	9.99%
1994	4.72%	7.59%	3.73%	1.31%
1995	30.42%	47.05%	36.69%	37.43%
1996	24.34%	26.56%	24.32%	23.07%
1997	22.31%	19.49%	22.33%	33.36%

Between now and next week, I am going to be reminding everyone that there are no guarantees when investing in stocks, that no one should invest any money that they expect to need within the next five years, and that neither I, nor anyone on the staff, nor anyone I know of has any special insight into what next year will bring. I am serious about that.

I get letters asking for my opinion on the near-term future all the time, but I have no such opinion. I do think that the next century is going to be incredibly exciting, with amazing technological advances and lots of opportunities for investors. But that doesn't rule out wars, famine, disease, and depression at various times, singly or all at once. And it certainly says nothing about the level of the S&P 500 next year.

Fool on and prosper!

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Get the Fool's new book - The Foolish Four

Current Dow Order | 1998 Dow Returns

12/16/98 Close

Stock Change Last -------------------- UK - 3/4 40.25 IP - 13/16 41.38 MO - 1/8 53.44 EK +1 3/8 73.06

Day Month Year FOOL-4 -0.37% -4.39% 9.13% DJIA -0.37% -3.58% 11.16% S&P 500 -0.07% -0.14% 19.74% NASDAQ -0.16% 3.07% 27.95% Rec'd # Security In At Now Change 12/31/97 206 Eastman Ko 60.56 73.06 20.64% 12/31/97 276 Philip Mor 45.25 53.44 18.09% 12/31/97 289 Int'l Pape 43.13 41.38 -4.06% 12/31/97 291 Union Carb 42.94 40.25 -6.26% Rec'd # Security In At Value Change 12/31/97 206 Eastman Ko 12475.88 15050.88 $2575.00 12/31/97 276 Philip Mor 12489.00 14748.75 $2259.75 12/31/97 289 Int'l Pape 12463.13 11957.38 -$505.75 12/31/97 291 Union Carb 12494.81 11712.75 -$782.06 Dividends Paid YTD $1092.81 TOTAL $54562.56 </FOOLISH FOUR PORTFOLIO>