Income Builder

Income Builder is a research-oriented newsletter that covers the equity and fixed income markets for individual investors. The newsletter tracks three special equity model portfolios - The Conservative Investor, The Trend Trader and Venture Capital. It also tracks investments in mutual funds (primarily cash alternatives), fixed income and gold coins. Any investment that is generally available to individual investors - including stocks, bonds and mutual funds - might be covered by the newsletter and included in its model portfolios.

Download Free Sample issue:
Bulletin 1261, December 21, 2005, 152 KB
Bulletin 1273, June 7, 2006, 171 KB

Fixed Income Investing:
Bulletin 1315, February 28, 2008

Total Performance of Income Builder Portfolios vs. the S&P 500
January 1, 2003 – October 31, 2008

	YTD	1-year	3-year	5-year
	Total	Total	Avg. Total	Avg. Total
	Return	Return	Return	Return
	2008	2007	2007	2007
Income Builder equity portfolio
Conservative Investor	-23.5%	-2.5%	11.4%	15.4%
Trend Trader	-48.8%	-12.6%	0.8%	10.7%
Venture Capital	-62.2%	31.9%	NA	NA
Other Stocks			NA	NA
Total equity portfolio	-36.1%	-1.9%	4.7%	13.8%

Dow Jones Industrials	-27.7%	16.3%	11.2%	13.0%
S&P 500	-32.1%	5.5%	8.5%	12.7%
Nasdaq Composite	-34.6%	10.3%	7.8%	15.6%

Income Builder portfolio sector returns
Equity	-36.1%	-1.9%	4.7%	13.8%
Mortgage/housing special investment	-47.4%
Cash	1.8%	4.9%	4.0%	2.9%
Fixed income	-2.6%	8.7%	6.3%	5.7%
Mutual funds (TIPs, money mkt.)	2.3%	4.7%	3.4%	3.8%
Gold	-13.3%	39.6%	24.2%	18.2%
Total portfolio	-11.3%	4.8%	5.7%	9.3%

In 2007, the Income Builder equity portfolios generated a total return of -1.9%. The primary cause of the sub-par performance was a series of losses on financial stocks, real estate-related stocks and others sectors (e.g. newspapers and telecom equipment). These losses more than offset modest gains in other areas, including renewable energy, natural gas and telecommunications. As a result of those losses, the equity portfolio underperformed the major market averages significantly in that year. The fixed income portfolio generated solid returns, with a strong gain on a high yield investment and solid returns on investment-grade corporate bonds. Overall, including cash, common stocks, fixed income and other investments, the Income Builder model portfolio generated a total return of 4.8% in 2007.

For the first ten months of 2008, the equity portion of the Income Portfolio produced a total return of -36.1%, which was modestly worse than the major market averages. The portfolio's returns have been hurt by losses on many of the same investments as in 2007 and also by a decline on a special portfolio of mortgage- and housing-related stocks and bonds entered into in late July. The fixed income portfolio produced a modest loss, consistent with market returns. Overall, however, the losses in the total portfolio were limited to -11.3%, owing to the portfolio's light weighting (of around 20%) in common stocks and heavy weighting in cash.

(Supporting figures available upon request.)

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