Our Focus List Stocks: Short Model Portfolio[1], the best of our Danger Zone picks, has beaten shorting the S&P 500 by 42% since the start of 2021 through the first nine months of 2025. See Figure 1. This outperformance underscores how important reliable fundamental research is.
Through the first nine months of 2025, however, the Model Portfolio underperformed the S&P 500 as a short by 4.6% (-17.1% vs. -12.5% for the S&P 500). See Figure 2.
Figure 1: Focus List Stocks: Short Performance Since Beginning of 2021
Sources: New Constructs, LLC
As a short portfolio, the Model Portfolio’s return increases when the underlying stocks go down.
Figure 2: Focus List Stocks: Short vs. S&P 500 in First Nine Months of 2025
Sources: New Constructs, LLC
Figure 3 details the Model Portfolio’s performance, which includes all stocks present in the Model Portfolio at any point in the first nine months of 2025.
Figure 3: First Nine Months of 2025 Performance of the Focus List Stocks: Short Model Portfolio
Sources: New Constructs, LLC
Performance includes stocks in the Model Portfolio in the first nine months of 2025 as well as those removed during the same time (3).
Professional and Institutional members get real-time updates and can track all Model Portfolios on our site. The Focus List Stocks: Short Model Portfolio leverages superior fundamental data, which provides a new source of alpha.
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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 over 48% over the past five years. The Index (ticker: BCORET:IND) was up 142% while the S&P 500 was up 93%.
Figure 4: Bloomberg New Constructs Core Earnings Leaders Index Outperforms S&P 500: Last 5 Years
Sources: Bloomberg as of October 3, 2025
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 62% 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 156% while the S&P 500 was up 93%.
Figure 5: Very Attractive-Rated Stocks Strongly Outperform the S&P 500: Last Five Years
Sources: Bloomberg as of October 3, 2025
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 31% 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 124% while the S&P 500 was up 93%.
Figure 6: Bloomberg New Constructs 500 Index Strongly Outperforms the S&P 500: Last Five Years
Sources: Bloomberg as of October 3, 2025
Note: Past performance is no guarantee of future results.
This article was originally published on October 10, 2025.
Disclosure: David Trainer, Kyle Guske II, and Hakan Salt receive no compensation to write about any specific stock, sector, style, or theme.
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[1] Stocks are in the Focus List Model Portfolios for different periods of time as we open and close positions during the year. When measuring outperformance of the Focus List Model Portfolios, we compare each stock’s return to the S&P 500’s return for the time each is in the Focus List Model Portfolios. This approach provides more of an apples-to-apples comparison of how each stock performed vs. the S&P 500.