capital preservation. “We have a fund that puts each one of those goals as a priority. And then we have an all-weather portfolio that does all three of those things that can be used for your entire portfolio,” says Root. Last year, each of the portfolios Root manages beat its comparable indexes... • The capital appreciation portfolio gained a 42% total return, besting the S&P 500’s total return of 31%. • The capital preservation portfolio gained 13% since its launch seven months ago – outperforming most safe cash – and bond- focused strategies. • The income portfolio earned investors a 4.9% yield for the year – more than triple the current yield of a U.S. Treasury Bill and more than double the average dividend of a S&P 500 stock. And it also delivered capital appreciation that took its overall total return to more than 27% gains – far better than most income-focused strategies, like the 21.5% return of the benchmark Vanguard Balanced Fund. • And the all-weather portfolio beat the Vanguard Balanced Fund and the S&P 500 with a total return of nearly 33%. These results for Main Street investors are even more shocking when you look at the average hedge-fund performance on Wall Street in 2019. The Bloomberg Global Hedge Fund Index shows that most have failed miserably... with the average hedge fund gaining just 7.8% last year – less than one-third the return of the S&P 500.
from Maverick Capital, Jonathan Auerbach of Hound Partners, and Charles Anderson of Fox Point Capital. “That’s where I pitched Domino’s Pizza (DPZ) at $7 a share,” says Root. And today as we go to print, Domino’s has climbed to almost $300... a more than 4,000% increase. Root ran his fund from 2009 to 2014, a time when the market climbed the so-called “wall of worry,” as most investors didn’t trust the economic recovery. “I remember 2011, as Europe looked like it was going to go back into the soup, markets got crushed. International markets got smoked. But we were up through that. “The key thing that we had was no down years... and really, more importantly, we made money for every one of our investors.” ‘MAIN STREET’ PORTFOLIO MANAGEMENT Today, Root runs the Stansberry Portfolio Solutions products at financial publishing firm Stansberry Research. Rather than giving advice to a handful of billionaires and their millionaire investors, he instead publishes the same sort of portfolio management recommendations to a group of about 20,000 Main Street investors... everyone from retired teachers and firefighters, business owners – and yes, even a few bank executives or hedge-fund managers. Root cites three primary goals that every investor has – long-term capital appreciation... safe, sturdy income... and
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