The Summer Hiatus Portfolio is a result of the recognition that high VST stocks go up over time. Thousands of tests have shown this to be true. In fact, the most recent results of 2,612 runs of buying and holding the top 20 stocks ranked by VST-Vector for at least one year show a 99.46% success rate. Only 14 runs out of 2,612 did not produce a profit! The average annual return was 18.35% and there was an average of 68.14% winning trades in each 20 stock portfolio. Phenomenal!

So why did the Summer Hiatus Portfolio produce only a 3.70% return with 45% winning trades? You could say it was the luck of the draw, but even that doesn't answer the question. With a standard deviation of 12.05%, there was only a five percent chance that I would get a return less than 6.30%. Am I that unlucky? I don't think so. It's just that I got too damn smart for my own good. See my essay of June 16, 2006 called "My Game Plan". In other words, I did not follow the test procedures exactly as they were conducted, so I learned, once again, that the market will do whatever it takes to keep you humble.

Had I bought the top 20 high VST stocks shown on October 6, 2006 and held them until the end of trading on July 6, 2007, I could have made a 21.31% return with a 55% winning trades. Had I bought the top 20 high VST stocks shown on October 6, 2006, sold on Rec = 'S' and replaced with top VST stocks, I could be up 25.86% with 54.24% winners as of yesterday. Moreover, I would own a blockbuster portfolio of stocks today.

Of course, I could go on and on all day long with should of, would of, could of's, but the test was not a failure. I also learned, once again, that I definitely am not a buy and hold kind of guy. In fact, I am a card carrying control freak. I could never sit still while stocks like SHOO, SYX, SIM and others went down in price. I like stocks that go up. When they don't, I get rid of them. I also learned that my faith in VectorVest is greater than it has ever been. Some high VST-Vector stocks may crash and burn, but over the long-term, they'll make money for you. Even if you get too smart like I did with The Summer Hiatus Portfolio.

P.S. The version of the Summer Hiatus Portfolio in which I used options for some positions made 5.57%.

P.P.S. The exact procedure we used for running the high VST performance tests is illustrated in this week's Strategy of the Week. To see this brilliant presentation, please click here: For further demonstration of this strategy, please see VectorVest University.