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By Matthew Coffina, CFA and Jeremy Glaser | 01-07-2016 12:00 AM

StockInvestor: 2015 Winners and Losers

Alphabet, Visa, and Novo Nordisk outperformed, while energy and basic materials were a drag on returns, says Morningstar's Matt Coffina.

Jeremy Glaser: For Morningstar, I'm Jeremy Glaser. I'm joined today by Matt Coffina--he's the editor of Morningstar StockInvestor newsletter. We're going to look back at his 2015 performance.

Matt, thanks for joining me.

Matt Coffina: Thanks for having me, Jeremy.

Glaser: You manage two real-money portfolios in the StockInvestor newsletter. What did your performance look like last year?

Coffina: We didn't have a great year. It wasn't a great year for the S&P 500 either. The S&P 500 was up 1.4%, including dividends; without dividends, it would have actually been down slightly. Our Hare portfolio was up 1.7%, so we just eked out some outperformance versus the S&P. The good news is that this was our fourth-straight year of outperforming the S&P. In the prior three years, we had a significantly larger margin of victory.

The Tortoise didn't do as well. It was down 1.3% for the year, underperforming the S&P by about 270 basis points. We were only up about 0.2% when you combine the two portfolios. So, we were trailing the S&P by about 124 basis points. It's not terrible, but I certainly hope to do better in the future.

Glaser: With your strategy, would you be surprised to underperform at any one given year?

Coffina: No. We have very much focused on the long term--the next five to 10 years. In our roughly 15-year history, we've underperformed in about five years and outperformed in the other 10. The goal is outperforming over a full market cycle. [2014] was a great year for the Tortoise; it outperformed by close to 800 basis points. So, I just see underperforming [in 2015] as giving back a little bit of the gains we had the prior year. What we're really focused on is whether, through a full bull and bear market, we are able to outperform the S&P, and we've done that historically. I'm optimistic that we'll be able to do that through the next market cycle.

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