Investor Relations
About Us
Investor Relations
 Press Release
U.S. Media Contact+1 312 696-6241
Kathy Panagopouloskathy.panagopoulos@morningstar.com
Morningstar's Tortoise Portfolio Wins One-Year 'Race'

CHICAGO, Jul 15, 2002 – Morningstar, Inc., a global investment research firm, today released the one-year performance of two stock portfolios, the Tortoise Portfolio and the Hare Portfolio, which are designed to help investors find undervalued stocks with good long-term prospects. Morningstar launched the two stock portfolios in June 2001, and the performance results were released in the July 2002 issue of Morningstar® StockInvestorSM, a monthly newsletter for individual investors. 

The value-oriented Tortoise Portfolio returned nearly 20 percent for the 12-month period ending June 17, 2002, outperforming the S&P 500 index by 34 percentage points, and beating more than 99 percent of large-cap blend mutual funds during the same period. 

The growth-oriented Hare Portfolio lost 19 percent of its value from June 18, 2001 to June 17, 2002, underperforming the S&P 500 index by almost 5 percentage points. The average domestic-growth fund lost nearly 20 percent for the 12 months ending June 17, 2002. The Nasdaq fell nearly 22 percent in the same period.

Combined, the two Morningstar portfolios returned 0.39 percent from June 18, 2001 to June 17, 2002, and beat the S&P 500 index by nearly 15 percentage points. The S&P 500 index was down 14 percent during the same period. 

"Just as a rising tide lifts all yachts, a receding tide sinks them," said Mark Sellers, editor of Morningstar® StockInvestorTM and manager of both portfolios. "Since last June, when we introduced the Tortoise and the Hare Portfolios, value and growth stocks have diverged widely. Not surprisingly, so have the performances of the Tortoise and the Hare. Still, we managed to outperform the averages during a bear market and we're pleased with the overall performance of the portfolios."

Top performers in the Tortoise Portfolio, from June 18, 2001 to June 17, 2002, included Jo-Ann Stores (JAS.A), up 189 percent, Humana (HUM), increasing 68 percent, and Office Depot (ODP), gaining 56 percent. 

The portfolio's retail stocks, which rose in value because of strong consumer spending and falling interest rates, helped the Tortoise outperform the S&P 500 index. Except for Schering-Plough (SGP), which fell 16 percent, all stocks in the Tortoise portfolio outperformed the S&P 500 index during the 12-month period.

Top performers in the Hare Portfolio during the 12-month period ending June 17, 2002, included Boston Scientific (BSX), increasing 65 percent, Dell (DELL) up 60 percent, and Microsoft (MSFT), posting a 39 percent gain. The Hare Portfolio's performance benefited most from holding a large cash position throughout the year, cushioning it somewhat from the brutal sell-off in large-cap growth stocks. Bad bets on telecom and technology, however, caused the portfolio to underperform the S&P 500 index by nearly five percentage points. 

Morningstar's portfolio committee makes each buy/sell decision. The committee is led by Sellers and includes Patrick Dorsey, director of stock analysis, senior stock analysts, and Haywood Kelly, Morningstar's editor in chief. Morningstar tracks, analyzes, and writes detailed research reports on 1,000 stocks. 

Morningstar's performance goal is for each portfolio to outpace the S&P 500--an index considered to be a proxy for the performance of the stock market--on a long-term, tax-adjusted basis. 

About Morningstar® StockInvestorTM
Morningstar launched the StockInvestor newsletter in 1998 and redesigned the publication in July 2001. Every month, the newsletter includes straightforward commentary on the Tortoise and Hare Portfolios, Bull and Bear debates on two high-profile stocks, and the proprietary Morningstar Rating for stocks. The newsletter also includes red flag alerts of stocks to avoid and a watch list of 50 stocks that possess large "economic moats," or competitive advantages. An annual subscription costs $89 and can be ordered by calling 1-800-735-0700 or via the Morningstar Web site, www.morningstar.com/products/ymsi

About Morningstar, Inc.
Chicago-based Morningstar, Inc. is a global investment research firm, offering an extensive line of print, software, and Internet-based products and services for individuals, financial advisors, institutions, and the media. The company is a trusted source for investment information, data, and analysis of stocks, mutual funds, and exchange-traded funds.

Editor's Note: For a complimentary subscription to Morningstar® StockInvestorSM, or for a complete list of stocks in each portfolio, contact Kathy Habiger, Morningstar Corporate Communications, 312-696-6241.

 Printer-friendly version
SEC Filings
Annual Reports
Earnings Releases
Calendar of Events
Analyst Coverage
Corporate Governance
Investor Communications
Investor Questions
Stock Information
Safe Harbor Provision
Investor Relations Contacts
News and SEC Filing Alerts
Request an investor information kit 
© Morningstar. All rights reserved.