Our Focus List Stocks: Long Model Portfolio, the best of our Long Ideas, and our Focus List Stocks: Short Model Portfolio, the best of our Danger Zone picks, beat the Risk-Free Rate (RFR) [1] as a long/short portfolio by 9% in the first half of 2026 (1H26). See Figure 1.
Longer term the Model Portfolio has outperformed the Risk-Free Rate as a long/short portfolio by 21% since the start of 2021 through 1H26. See Figure 2. This outperformance underscores how important reliable fundamental research is.
Figure 1: Focus List Stocks: Long/Short Performance vs. Risk-Free Rate: 1H26
Sources: New Constructs, LLC
Note: Gain/Decline performance analysis excludes transaction costs, dividends and rebates. The Risk-Free Rate is based on the 3-month T-bill.
The long portfolio was up ~12% and the short portfolio added ~2% for a net return of +14.1% compared to the Risk-Free Rate at +5.3% in 1H26. Note that short portfolios outperform when they fall more than the benchmark.
Figure 2: Focus List Stocks: Long/Short Performance vs. RFR: 2021 Through 1H26
Sources: New Constructs, LLC
Note: Gain/Decline performance analysis excludes transaction costs, dividends and rebates. The Risk-Free Rate is based on the 3-month T-bill.
Figure 3 details the Model Portfolios’ performance, which includes all stocks present in the Model Portfolios at any point in 1H26.
Figure 3: 1H26 Long/Short Performance of Stocks in the Focus List Model Portfolios
Sources: New Constructs, LLC
Performance includes stocks in the Model Portfolio in 1H26 as well as those removed during the same time (6 stocks).
The Focus List Stocks: Long Model Portfolio leverages superior fundamental data, which provides novel alpha. Professional and Institutional members get real-time updates and can track all Model Portfolios on our site.
We’re here to help you navigate any market cycle. Our uniquely rigorous fundamental research consistently earns #1 rankings in several categories on SumZero over the last 61 months.
Check Out the Indices Based on New Constructs Research
While we’re writing about how our Focus List Stocks: Long Model Portfolio finds winning stocks, we should highlight the indices we’ve developed with Bloomberg’s Index Licensing Group. All three have outperformed the S&P 500 over the past five years. See Figures 4-6.
- Bloomberg New Constructs Core Earnings Leaders Index (ticker: BCORET:IND)
- Bloomberg New Constructs Ratings VA-1 Index (ticker: BNCVA1T:IND)
- Bloomberg New Constructs 500 Index (ticker: B500NCT:IND)
The Bloomberg New Constructs Core Earnings Leaders Index, which allocates based on Earnings Capture and Core Earnings, beat the S&P 500 by 37% over the past five years. The Index (ticker: BCORET:IND) was up 109% while the S&P 500 was up 71%.
Figure 4: Bloomberg New Constructs Core Earnings Leaders Index Outperforms S&P 500: Last 5 Years
Sources: Bloomberg as of July 3, 2026
Note: Past performance is no guarantee of future results.
The “Very Attractive Stocks” Index, which allocates to stocks that get a Very Attractive rating by our AI Agent for Investing, beat the S&P 500 by 20% over the last five years. Bloomberg’s official name for the index is Bloomberg New Constructs Ratings VA-1Index (ticker: BNCVAT1T:IND). Figure 5 shows it was up 91% while the S&P 500 was up 71%.
Figure 5: Very Attractive-Rated Stocks Strongly Outperform the S&P 500: Last Five Years
Sources: Bloomberg as of July 3, 2026
Note: Past performance is no guarantee of future results.
Our “Core-Earnings Weighted S&P 500” Index, which weights the largest 500 U.S. companies by Core Earnings instead of market cap, beat the S&P 500 by 24% over the past five years. Bloomberg’s official name for the index is Bloomberg New Constructs 500 Total Return Index (ticker: B500NCT:IND). Figure 6 shows it was up 95% while the S&P 500 was up 71%.
Figure 6: Bloomberg New Constructs 500 Index Strongly Outperforms the S&P 500: Last Five Years
Sources: Bloomberg as of July 3, 2026
Note: Past performance is no guarantee of future results.
This article was originally published on July 8, 2026.
Disclosure: David Trainer and Kyle Guske II receive no compensation to write about any specific stock, sector, style, or theme.
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[1] The Risk-Free Rate is based on the 3-month T-bill.