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GREAT PROFITS IN THE COMPANY OF GOOD FRIENDS | JANUARY 1, 2018, VOLUME 31, NO. 1

The Oxford Club Investor’s Forecast 2018

Alexander Green Chief Investment Strategist 2017 Was Another Blockbuster Matthew Benjamin Editorial Director Year for Us Samuel Taube Managing Editor Now Watch This Cancer Company Blast Higher in 2018

Anne Mathews Managing Copy Editor Dear Member, Allison Brickell The past year was another exceptional one for Oxfordians. Copy Editor As I write, 18 of the 19 positions in our Oxford Trading Portfolio are Alison Kassimir Art Director profitable, with gains as high as 284%. Five of the six positions in our Oxford All-Star Portfolio are profitable, with gains as high as 442%. All Chelsea Centineo of the positions in our Gone Fishin’ Portfolio are profitable, with gains as Graphic Designer high as 410%. ALEXANDER GREEN James Boxley Cooke Honorary Chairman While the individual stocks in our Ten-Baggers Portfolio have fluctuated widely – as I sug- gested they would from the outset – the portfolio has doubled the market so far in 2017, Julia Guth including a realized gain of 227% in Kite Pharma. CEO & Executive Director I look forward to another prosperous year in 2018. And one sector looks particularly prom- Ryan Fitzwater Director of Research ising: small cap to midcap biotechnology stocks.

Chris Matthai I see two reasons for a rally here. One is that the industry has recently undergone a signifi- Senior Research Analyst cant correction and valuations are far more reasonable. Steven King The other is that the FDA just announced plans to allow quick approval of cancer drugs if Event Director they show early and “outsized” survival benefits for patients, even in smaller studies. Nathan Hurd Director of VIP Trading In other words, many cancer drug companies just got cheaper as their prospects became Services more favorable. That’s a good combination. This month I highlight a leading cancer drug company that could rise severalfold in the months ahead. The firm already has a leading cancer drug with FDA approval – and annual revenue of more than $1 billion. Its up-and-coming pipeline should lead to more approvals this year.

Please read on... m e m o f r o m t h e c h i e f 2

Sales and earnings will almost certainly drive these That protects both our principal and our profits. shares higher. But we use a different sell discipline to avoid But there is also a chance the company will be stopping out of these more volatile stocks too soon. bought out by a larger competitor like Amgen (Nasdaq: AMGN), Celgene (Nasdaq: CELG) or Here we sell only when there is a fundamental Gilead Sciences (Nasdaq: GILD). change in the business outlook or the company misses the quarterly consensus earnings estimate by That’s why it’s the newest addition to our Ten- 25% or more. Baggers of Tomorrow Portfolio. As I mentioned, this approach has allowed us to The companies in this portfolio are different from roughly double the market’s return this year. And our other recommendations. today I have a new addition to our Ten-Baggers Portfolio: Incyte Corp. (Nasdaq: INCY). They tend to be younger, smaller and more volatile. Based in Wilmington, Delaware, Incyte is a They also have to have the realistic potential to rise biotech focused on the discovery, development tenfold or more. and commercialization of proprietary therapeutics, From the beginning, the companies in this portfo- mostly in the field of cancer treatment. lio have had to meet six minimum requirements: Although the company has a diverse and growing • They must be tremendous innovators, offering portfolio of drug candidates, its first commercial revolutionary technologies, new medical product – Jakafi – is approved in the U.S. for devices, blockbuster drugs, or other cutting- patients with intermediate or high-risk myelofibro- sis, a cancer of the bone marrow. edge products and services. • They must experience terrific sales growth. In Jakafi is a big hit with both doctors and investors. this case, top-line expansion has to be 30% or Oncologists and their patients are excited by the more. drug’s effectiveness. • They must protect their margins. A firm needs Investors are wowed by its list price: $11,587 a to rebuff competition with patents, trademarks month, indefinitely. (This is generally covered by or brand names. insurance.) • They must beat consensus estimates. In the Investors are also excited about a new Incyte short term, share outperformance is all about medicine, epacadostat. Epacadostat amplifies the beating expectations. Even if a company loses potency of two drugs made by Bristol-Myers money, it can still register as a significant beat Squibb (NYSE: BMY) and Merck (NYSE: MRK). if the loss is smaller than expected. Both unlock the human immune system, allowing • They must be small cap to midcap companies. it to attack tumors. Mega-corporations simply cannot grow at the high rates of smaller firms. In clinical studies, for example, patients with advanced forms of the deadly skin cancer melanoma • They must be relatively unknown. Once a see their tumors disappear with a combination of company becomes a household name, the para- epacadostat and one of these other drugs. bolic move higher is often over. Investors who recognize opportunities early have a substantial A big trial will be completed in the first quarter of advantage. 2018. Success here could light a fire under Incyte. Our sell discipline is different here too. Unlike most of its competitors, Incyte focuses on the basic chemistry of making drug molecules. In our Oxford Trading Portfolio, for example, we sell any stock that closes 25% or more below its That’s a technical part of the drug discovery closing high. process that many biotechs outsource. m e m o f r o m t h e c h i e f 3

But Incyte does this work in-house because it has of healthcare, they generally point to drug prices. an army of qualified scientists and because it has Yet drugs are only 11% of overall U.S. healthcare access to the latest cutting-edge technology – like expenditures. the NMR spectrometer – that enables researchers to see individual molecules that can be turned into If effective drugs can reduce the need for the other 89% of costs, the price of treatment will come new drugs. down substantially. The numbers at Incyte are already impressive. Incyte is at the forefront of this movement. Third quarter results exceeded both top- and bottom-line estimates. As I write, the biotech sector – which was strong in the first three quarters of the year – has under- Revenue soared 42% year over year. (Jakafi sales gone a correction. alone jumped 36% to $304 million.) Earnings per share beat the consensus by 183%. Incyte itself has sold off, in part due to buyout rumors that didn’t materialize. This doesn’t mean And the future looks especially promising. the company is not still a takeover candidate. Along with earnings, Incyte It has over $1 billion in announced expansion of annual sales – and a valuable its collaboration agreement “If effective drugs can immunotherapy pipeline. with AstraZeneca’s research Incyte also has a healthy and development arm, reduce the need for the balance sheet with $1.3 MedImmune. other 89% of costs, the billion in cash and only $23.7 million of debt. The companies will evaluate price of treatment will the effectiveness and safety Historically, the best time of epacadostat in combina- come down substantially. to invest in biotech stocks is tion with an AstraZeneca after the short-term specula- drug for patients with non- Incyte is at the forefront tors have sold. small cell lung cancer. of this movement.” This appears to be one of Incyte CEO Hervé those times. The entire Hoppenot is not just sector has gotten a haircut focused on profits, incidentally. He intends to in recent weeks. Yet there have been no clinical overturn the entire field of cancer therapy. failures at Incyte and no earnings miss. Indeed, the company recently blasted estimates. In a recent interview with Forbes, Hoppenot said, “If we are successful, the entire cost of treating In short, Incyte is a potential ten-bagger. The firm cancer should be drugs. That is my hope, not is experiencing dynamic revenue growth and sig- from a business standpoint but from a medical nificant progress in its clinical development port- standpoint. What you would like is being able to folio. replace palliative treatment and hospital treatment for patients who are a few months from dying with The firm just turned the corner on profitability medicines that are very effective against cancer.” and should earn almost a dollar a share in 2018. This is no pipe dream. Successful drugs – even While sales and earnings growth will be prodi- costly ones – will ultimately save the healthcare gious... Incyte remains an attractive buyout candi- system money. date too. How? By reducing the need for even more expen- Action to Take: Buy Incyte Corp. (Nasdaq: INCY) Safety Switch sive services. at market. We will notify you with a Alert if the company reports quarterly results 25% or When Americans complain about the high cost more below the consensus estimate. n b e y o n d w e a l t h 4 How Pessimists Make Getting Rich Easy Alexander Green, Chief Investment Strategist, The Oxford Club

According to a new report from Credit Suisse, If this is Armageddon, bring it on. America has 43% of the world’s millionaires, the most of any nation. Of course, it’s not Armageddon. And you’d think someone who shows up every day at the Carnegie There are currently 15.35 million millionaires in Endowment for International Peace might have a the U.S. That’s 1.1 million more than last year. little better perspective on the state of modern gov- ernance, human rights, economics and prosperity: Some ask how there could possibly be so many. I’m more interested in understanding why there • The number of democracies worldwide is rising. aren’t far more. Autocracies and theocracies are declining. • People enjoy broad property rights and the After all, the four-step formula that most million- freedom to trade goods and services without aires follow is straightforward: work hard... save... oppressive restrictions. According to The invest... compound. Heritage Foundation’s annual Index of Plenty of Americans work hard, of course. Most Economic Freedom, more people are enjoying save (if not enough). more economic freedoms than ever before. But too few invest suc- “Too few invest • Rights – to life, liberty, cessfully or reinvest their property, marriage, repro- interest, dividends and successfully or reinvest duction, speech, worship, capital gains so their gains their interest, dividends assembly and protest – are compound. and capital gains so their more widespread than ever. In my experience, many • Poverty is declining world- don’t because they are pes- gains compound.” wide, and First World afflu- simistic – if not downright ence is on the rise. Since fearful – about the future. 1990, the percentage of the world’s population living in poverty has For example, Christopher Smart, a senior fellow at declined by 50%. And the Federal Reserve the Carnegie Endowment for International Peace, recently reported that U.S. household net kicked off an article in Barron’s last month with worth hit $96.2 trillion in the second quarter, this blunt statement: an all-time record. “One of the great mysteries of today’s global • More people in more places are living longer markets is their irrepressible enthusiasm, even than ever before. The human life span has as the world appears on the verge of chaos or nearly doubled over the last hundred years. collapse.” • A smaller percentage of people die as a result of violent conflict than at any time in human Mr. Smart clearly spends a lot of time watching history. Contrast this with the 20th century, cable news. with its two world wars and countless regional If he turned it off, he might recognize that the and civil wars. market’s “irrepressible enthusiasm” has something • Homicide rates have fallen precipitously from to do with synchronized global growth, low infla- over 100 murders per 100,000 people in the tion, rock-bottom interest rates, cheap energy, full Middle Ages to less than one per 100,000 employment and record corporate profits. today in the West. b e y o n d w e a l t h 5

• Violent crime has fallen for years. Despite the too high and Starbucks is unimaginative because sensational images on TV, the chance of dying the stores are all the same, he concludes, “We are a violent death in the U.S. is the lowest it has living in a Blade Runner-esque dystopia.” ever been. Got that? • Torture and the death penalty have been outlawed by most nations, and the latter is less It’s not that society has problems. It’s not that frequently practiced where it is legal. things could be better. • Citizens of most nations are treated more We live in a dystopia. equally under the law than at any time in the past. In the United States, our rights – Personally, I hope folks like Mr. Stanley and Mr. enumerated in the (ahem) Smart keep preach- Constitution and Bill ing their anti-prosperity of Rights – protect “In my experience, gospel. individuals from being many don’t because they After all, if everyone realized discriminated against that we enjoy political, because of their race, are pessimistic – if not economic and religious color, creed, gender and downright fearful – about freedoms denied to billions sexual orientation. around the world and the future.” throughout history... and We in the West today are that we live in a free market living longer, richer, safer, society where entrepreneurs freer lives than any people and businesspeople constantly knock themselves in the history of the planet. out to bring us new products and services that are Despite this widespread affluence, pessimism better, cheaper and longer lasting... and that edu- reigns – and not just in the United States. cational attainment has never been greater, human life spans have never been longer and standards of While touring England and Scotland recently, I living have never been higher, there would be a lot read an eye-opening column by Tim Stanley of more competition for investment ideas. The Daily Telegraph. So do yourself – and other clear-thinking individu- Grousing that he “hates” London because rents are als – a favor. Don’t spread the word. n

5:07: Wall Street Gets BLINDSIDED The 5:07 mark of this video is VERY CONTROVERSIAL. It’s no wonder Wall Street has sent out diversionary tactics on this strategy. They’ve been beaten at their own game!

Click here to discover the shocking reveal at the 5:07 mark... and why it could help regular people collect $103K in the next 12 months. b e y o n d w e a l t h 6 The Beauty of Slowing Down Alexander Green, Chief Investment Strategist, The Oxford Club

I have several friends who are financially inde- • Doctors say slower breathing is one of the pendent, but they are certainly not wealthy. Why? simplest ways to better health. Deep breath- Because their schedules are packed, their days over- ing lowers stress and reduces systolic blood loaded and they regularly carp about having no pressure. It allows oxygen to get down to free time. the smallest airways in our lungs, the alveoli, where the oxygen exchange is most efficient. What kind of affluence is that? They have money Quick, shallow breathing causes your body but not the time to enjoy it. They have financial to release less nitric oxide, so your organs and freedom but choose to relentlessly pursue more tissues are less oxygenated. instead. They are victims of mindlessness, ambition • Eat more slowly, and you will eat less. There is or distraction. In many ways, their lives are more a lag time between when the stretch receptors impoverished than those who have far less. in your stomach signal it is time to stop eating Of course, it’s not easy to find the right balance and your brain gets the message. If you slow between achievement and enjoyment. But when your intake, you won’t just savor your meals things are out of whack, the symptoms are pretty more. Researchers at the University of Rhode obvious. The people around us are talking, but Island discovered that people who eat more we’re not listening. slowly consume 70 fewer calories per meal. Multiply that by three meals a day, and you’ll We’re divided between what is happening here drop 20 pounds over the next year. and what is happening somewhere else. Or we’re • Slowness won’t hurt your love life. Mae West thinking about what will happen tomorrow... or once remarked that anything worth doing is 15 minutes from now. In the process, we miss a worth doing slowly... very slowly. Marriage lot. counselor Lori Buckley of Pasadena agrees, Modern society puts a premium on speed and effi- “Often, the first thing to disappear from a ciency, too. We figure we can accomplish more by marital relationship is the long, lingering, doing two or three things at once. teasing kiss.” • Slowing down prevents accidents. It’s impossi- But this distraction comes at a price. ble to calculate the number of motorists killed John Freeman, editor of Freeman’s and author of or injured each year because they were in a rush. Insurance companies have found that the The Tyranny of E-mail, writes, “We will die, that overwhelming majority of job site accidents much is certain; and everyone we have ever loved can be traced to hurrying. will die, too, sometimes – heartbreakingly – before us... Busyness numbs the pain of this awareness, • Slowness is even part of successful money but it can never totally submerge it. Given that management. Some folks realize late in life our days are limited, our hours precious, we have that they haven’t saved enough for retire- to decide what we want to do, what we want to ment. To make up for lost time, they often say, what and who we care about, and how we decide to roll the dice by trading risky deriva- want to allocate our time to these things within tives (futures and options), penny stocks, the limits that do not and cannot change. In short, cryptocurrencies, or hot tips from friends and we need to slow down.” colleagues. Big mistake. When it comes to meeting long-term investment goals, starting He has a point. And we have a choice to do some- early, investing regularly and reacting slowly is thing about it. a winning combination. b e y o n d w e a l t h 7

• A more deliberate pace enhances your quality wealthy, not rich; to study hard, think quietly, talk of life. There’s an old Chinese saying, “He gently, act frankly... await occasions, hurry never... who hurries cannot walk with dignity.” A in a word, to let the spiritual, unbidden and constant flurry of activity does not present unconscious, grow up through the common – this an attractive image. And it creates stress and is to be my symphony.” anxiety, causing you to miss a lot of what is We all have obligations and deadlines. But hurry going on around you. As the philosopher Lin and extreme future-mindedness impoverish the Yutang noted, the wise man is not hurried and present. What we value most is love, friendship, the hurried man is not wise. solace, beauty and humor. Yet these things are best Deep down, most of us realize this. But it never appreciated or communicated face to face in a hurts to be reminded – and perhaps take things calm, relaxed setting. down a notch. More than 150 year ago, clergyman Slowing down enhances your sense of gratitude, and transcendentalist William Henry Channing improves your mental and physical health, allows described the slower, more relaxed life as his you to gain control of your life, lets you appreciate “Symphony”: beauty, and enables you to reconnect with those around you. “To live content with small means; to seek elegance rather than luxury, and refinement rather Sometimes the best way to spend a day is simply than fashion; to be worthy, not respectable, and savoring what you have before it’s gone. n

The Oxford Club’s 20th Annual Investment U Conference March 15-18, 2018 | Four Seasons | Las Vegas

Are you free March 15-18? If so, please join us at the Four Seasons in Las Vegas for our 20th Annual Investment U Conference! Here’s your chance to connect with like-minded individuals, get inspired by our brilliant guest speakers and learn new investment ideas from our entire team of renowned experts. Our presenters include Chief Investment Strategist Alexander Green... crowd favorites such as Sprott U.S. Holdings CEO Rick Rule and TradeStops CEO Richard Smith... and our exciting keynote speakers, the senior advisor to MIT’s Digital Currency Initiative, Michael Casey, and former Merrill Lynch stockbroker Mark Jeffries. Together, our speakers will teach you how to master the “Art of Intelligent Speculation” – and they won’t leave any topic uncovered. You’ll learn everything you need to know about cryptocurrency, today’s hottest technology plays, the art of independent investing and so much more. As always, it wouldn’t be an Oxford Club event without a jam-packed schedule of exciting new moneymaking strat- egies and spectacular receptions, all of which will make this the most rewarding trip you’ll take all year.

Spots are filling up fast, but you still have time to reserve your seat. For all the details, simply click here. The Oxford Portfolio REVIEW by Alexander Green

This bull market is fast approaching its 9th That was below expectations, and Expedia dropped birthday. We’ve taken full advantage in our Oxford from over $150 a share to around $120. investment portfolios, locking in dozens of profits over this period. Since Liberty’s value is tied to Expedia’s, its shares fell in unison. Looking forward, however, there are Yet I still see plenty of opportunities out there. One good reasons for optimism. of them is Liberty Expedia (Nasdaq: LEXEA), a Colorado-based holding company. For example, expenses rose last quarter because Expedia made the conscious choice to advertise One of its principal assets is 16% ownership of more heavily, something it needed to do in the face Expedia (Nasdaq: EXPE), through 10.8 million of increasing marketing efforts by competitors like shares of common stock and 12.8 million shares of Priceline and TripAdvisor. Class B common stock – representing an approxi- It’s already paying off. Bookings increased 11% in mately 52% voting interest. the September quarter. It also owns 100% of Vitalize – formerly known as Plus, the industry itself is expanding. An analysis by Bodybuilding – a holding company with health, eMarketer estimates a 45% expansion in the sales fitness and media-related businesses. of digital travel services between 2016 and 2020. One of the biggest challenges facing businesses That amounts to more than $817 billion. today is getting valuable but fickle customers – The total travel market is estimated at around $1.3 always alert to lower prices and better deals – to trillion globally. So while Expedia is already a major stick with them over the long haul. player, it holds only a mid-single-digit percentage Expedia – one of the world’s leading travel com- market share. That means there is still enormous panies – has done that in spades. Through its opportunity here. website (or toll-free number), consumers and busi- CEO Mark Okerstrom said in a conference call nesses can book airline tickets, hotel reservations, following the release of third quarter earnings, car rentals, cruises, vacation packages and even “We now find ourselves in the enviable position of attraction tickets. having all of the essential assets needed to realize Expedia owns over 200 travel booking sites in our full potential as a company. Looking forward, more than 75 countries. It offers rooms in over we are more optimistic than ever.” 435,000 properties, tickets on more than 500 I couldn’t agree more. Keep buying. airlines, bookings for dozens of car rental com- panies and cruise lines, and tickets to more than 25,000 attractions. Equity Residential: Put a Fortress in The company also owns some of the world’s Your Portfolio leading online travel brands, including Trivago, Over the past several decades, commercial real Orbitz, Travelocity, HomeAway, Classic Vacations, estate has been one of the most rewarding invest- SilverRail and Hotwire. ments in the country. In the past 12 months, it generated $9.8 billion in Unfortunately, the sector is not particularly acces- sales on gross bookings of more than $83.8 billion. sible to the broad investing public. In October, however, the company reported that Most investors don’t have the cash or the credit line earnings per share rose 7% on a 15% increase in necessary to buy apartment buildings, industrial revenue. parks, shopping centers and warehouses. p o r t f o l i o r e v i e w 9

And of the trillions of dollars in commercial real and condos – for every budget and lifestyle – in estate in the U.S., very little of it is publicly traded. growth markets where people most want to live. That small percentage that does trade is generally in The meltdown in home prices during the recent the form of real estate investment trusts (REITs). financial crisis took the shine off the idea that everyone should be a homeowner. And in this A REIT is a security that invests directly in real sluggish economy, many consumers either can’t estate but trades on an exchange like a stock. afford a home or can’t qualify for the mortgage. According to the federal Bureau of Economic So the rental market is strong. Analysis, real estate, rentals and leasing make up 13% of our gross domestic product. Yet REITs rep- The trust takes in more than $2.4 billion in annual resent approximately just 3% of the S&P 500. revenue. It enjoys an operating margin of 34%. And you’ll collect a 2.9% dividend here, too. If you want a portfolio that reflects the U.S. economy, you need to own a piece of this sector. The executives at Equity Residential are actually looking forward to the Fed raising rates. Why? REITs are highly liquid. Because higher rates indicate an improving They allow you to own a diversified portfolio of economy, strong job growth and rising wages. That income-producing properties in a single investment. means increasing demand for industrial space, office space, retail and housing. They have a low correlation with the stock market, making REITs a great portfolio diversifier. And And for those who are nervous about this market, because they are required to pay out at least 90% of Chairman Sam Zell offers some encouraging words: their net income to shareholders each year, they are “We think of Equity Residential as a fortress for also reliable dividend payers. investors. We are a large, liquid company focused Some analysts believe the higher yields make them on strategic capital allocation, relentlessly driven vulnerable to an interest rate rise. But there is no to achieve superior operations and supported by evidence to support that. a balance sheet that enhances returns while main- taining capacity to take advantage of the next During five of the six periods since 1978 in which opportunity.” the Fed lifted short-term rates, REITs generated positive returns and outperformed both U.S. stocks Equity Residential has returned more than 275% and bonds. since we put it in our portfolio over a decade ago. Yet the shares remain attractive at current levels. That brings me to Equity Residential Properties Trust (NYSE: EQR) in our Oxford All-Star Portfolio. “What’s Up With the Ten-Baggers Equity Residential owns or has investments in Portfolio?” 302 properties consisting of 77,498 apartment The market is having an exceptional year. As of this units located primarily in Boston, New York City, writing, the S&P 500 – including dividends – has Seattle, San Francisco, Southern California and returned 20.13%. Washington, D.C. If you owned a mutual fund that returned twice as It was founded by Sam Zell and Bob Lurie – two much over this period, would you be happy with of the most successful property moguls in the that performance? nation – with the philosophy of investing in prop- erties at the right price and hiring the best people Most Members would answer with an unequivocal to manage them. “yes,” especially since three-quarters of all actively managed stock funds fail to beat their benchmarks The trust buys, builds, and rehabs apartments each year. p o r t f o l i o r e v i e w 10

What if you owned a portfolio of individual stocks On the positive side, Proofpoint (Nasdaq: PFPT) that had doubled the return of the market over this is up nearly 17% and Accelerate Diagnostics period – would you also be satisfied with that? (Nasdaq: AXDX) is up 34%. And Kite Pharma was bought out a few weeks ago by Gilead Sciences I asked a friend this, and he gave me a puzzled look. (Nasdaq: GILD), handing us a 227% gain. “If the return is identical,” he said, “what difference would it make?” (When you earn a 227% profit, it makes up for a lot of missteps elsewhere.) All the difference in the world to some, I’ve learned. I mentioned this at a recent Oxford Club event, Investors are generally happy with a market-beating and a Member said, “But I didn’t buy Kite.” mutual fund, in part because they have no idea what is happening within the fund itself. That brings me to an important point. The Oxford Club doesn’t exist to offer a smorgasbord of “stock They don’t know how many stocks are up and how tips.” We recommend various investment portfo- many are down. They don’t know how many gains lios, each with a battle-tested strategy that includes have been realized or how many losses. They don’t a well-defined set of buy and sell criteria. even know which stocks the fund owns because by the time a fund publishes its holdings, they have If Members want to deviate from our approach and already changed, perhaps substantially. buy only the stocks they like or sell them when they prefer, their returns are bound to vary. An actively managed fund is essentially a black box that shareholders cannot see inside of. If your performance is better than ours, congratu- lations. But – overwhelmingly – I hear just the The same is not true for the stocks in your broker- opposite. age account. Most of the excuses – such as “I can’t buy them all” Members know what stocks they own and can see – are hard to justify. – in real time – how much they have moved up or down. They know (and can emotionally feel) the Razor-thin stock spreads and deep-discount com- losses they have taken and the profits they have missions make it easy to spread your bets. locked in. Yes, it would be impractical to buy every recom- For many, that changes their perception of the mendation in every investment letter out there. returns entirely. For example, as of this writing, our Nor should you want to. If you own hundreds of Ten-Baggers of Tomorrow Portfolio is up 32.6% stocks, it becomes nearly impossible to outperform year to date. the market. If we were mutual fund managers, shareholders Superior performance is the result of taking smart, would send us bouquets of roses. Yet we’ve been concentrated positions and then following an collecting brickbats instead. Consider this note ironclad sell discipline. from Member M. Baker: We do that with every portfolio in The Oxford “Your investment advice has been very poor... You Communiqué – and with each of our VIP Trading talk a good game, but the results do not back the Services. talk. I invest to make money not lose money.” If you’re not enjoying outsized returns, it would How can we double the market’s return and still behoove you to stop improvising and follow our make some Members unhappy? approach to the letter. Here’s how. Two of the five current positions are After all, it’s this approach that led the independent down. One is at breakeven. And last year we had Hulbert Financial Digest to put the Communiqué on realized losses in Stratasys (Nasdaq: SSYS) and its Honor Roll of the top 10 investment letters in First Solar (Nasdaq: FSLR). the nation for 16 consecutive years. n p o r t f o l i o s , j a n u a r y 2 0 1 8 11

THE OXFORD TRADING PORTFOLIO An active and diversified portfolio of the market’s most compelling opportunities.

COMPANY/SYMBOL REC. DATE REC. PRICE CURR. PRICE RATING TRAILING STOP TOTAL GAINS

American Water Works (NYSE: AWK) Apr-16 $68.59 $89.32 Buy $69.19 34.2% Check Point Software Technologies Ltd. May-14 $66.96 $105.43 Buy $89.35 57.5% (Nasdaq: CHKP) Diageo PLC (NYSE: DEO) Mar-09 $49.80 $140.61 Buy $106.93 234.8% Grupo Supervielle (NYSE: SUPV) Nov-17 $26.09 $29.51 Buy $22.13 13.1% iShares MSCI Emerging Markets Fund Nov-15 $35.94 $45.86 Buy $35.86 31.4% (NYSE: EEM) Laboratory Corp. of America (NYSE: LH) Oct-15 $118.29 $156.02 Buy $120.88 31.9% Liberty Expedia Holdings (Nasdaq: LEXEA) Oct-17 $52.55 $44.17 Hold $42.38 -15.9% Match Group (Nasdaq: MTCH) Dec-16 $17.49 $28.37 Buy $23.18 62.2% PayPal (Nasdaq: PYPL) Jun-16 $39.06 $73.62 Buy $58.93 88.5% PetMed Express (Nasdaq: PETS) Dec-17 $38.87 $43.51 Buy $32.63 11.9% Philip Morris Int’l (NYSE: PM) Mar-09 $35.63 $107.30 Buy $90.53 284.0% PVH Corp. (NYSE: PVH) Feb-16 $66.41 $132.94 Buy $103.17 100.6% REV Group (NYSE: REVG) Jun-17 $26.02 $27.12 Buy $23.04 4.6% Rio Tinto PLC (NYSE: RIO) Mar-16 $26.84 $47.70 Buy $37.88 87.5% Ryanair (Nasdaq: RYAAY) ADR Jun-15 $69.74 $114.93 Buy $95.02 67.2% Stryker Corp. (NYSE: SYK) Aug-17 $145.37 $153.67 Buy $119.81 6.0% TJX Companies (NYSE: TJX) May-12 $41.09 $73.62 Buy $60.92 90.3% TransUnion (NYSE: TRU) Jul-17 $43.32 $55.00 Buy $41.78 27.0% WisdomTree Japan SmallCap (NYSE: DFJ) Feb-10 $39.90 $79.36 Buy $59.60 116.3%

Note: If a “Buy” recommendation pulls back to within 5% of our protective stop, we routinely move it to a “Hold.” If the stock resumes its upward climb, we will move it back onto our “Buy” list.

THE TEN-BAGGERS OF TOMORROW PORTFOLIO A select group of more speculative stocks with the potential to rise tenfold or more.

COMPANY/SYMBOL REC. DATE REC. PRICE CURR. PRICE RATING TOTAL GAINS

Accelerate Diagnostics (Nasdaq: AXDX) Sept-16 $22.33 $30.00 Buy 34.3%

Exelixis (Nasdaq: EXEL) Sept-17 $26.91 $26.84 Buy -0.3%

Glaukos (NYSE: GKOS) Dec-16 $34.10 $25.90 Buy -24.0%

Incyte Corp. (Nasdaq: INCY) Jan-18 New $95.40 Buy New

Momo Inc. (Nasdaq: MOMO) Apr-17 $33.66 $24.75 Buy -26.5%

Proofpoint (Nasdaq: PFPT) Oct-16 $74.56 $87.07 Buy 16.8%

Note: We do not use our 25% trailing stop in this portfolio. Instead, a sell recommendation will be triggered if a company misses the quarterly consensus earnings estimate by 25% or more – or if we believe the company’s business prospects have changed for the worse in some fundamental way. 12 THE OXFORD ALL-STAR PORTFOLIO A diversified basket of funds and holding companies managed by some of the world’s top-performing money managers.

COMPANY/SYMBOL REC. DATE REC. PRICE CURR. PRICE RATING TRAILING STOP TOTAL GAINS

Berkshire Hathaway B Shares (NYSE: BRK-B) Jan-01 $44.58 $199.07 Buy None 346.5%

Equity Residential (NYSE: EQR) Jul-01 $28.05 $66.30 Buy None 278.6%

Icahn Enterprises L.P. (Nasdaq: IEP)^ Nov-13 $78.23 $52.30 Buy None -0.9%

Markel Corp. (NYSE: MKL) Jul-15 $789.45 $1,121.69 Buy None 42.1%

Templeton Dragon Fund (NYSE: TDF) May-02 $9.20 $20.74 Buy None 442.1%

Templeton Emerg. Mkts. Fund (NYSE: EMF) Jan-02 $8.80 $16.99 Buy None 285.3%

Note: The All-Star managers make buy and sell decisions within these securities themselves. We do not use trailing stops here.

THE GONE FISHIN’ PORTFOLIO A simple but sophisticated long-term investment system based on a Nobel Prize-winning strategy.

COMPANY/SYMBOL REC. DATE REC. PRICE CURR. PRICE RATING ALLOCATION TOTAL GAINS

Vanguard Small Cap Index (NAESX) Apr-03 $15.12 $70.09 Buy 15% 410.3%

Vanguard Total Stock Mkt. Index (VTSMX) Apr-03 $19.59 $66.62 Buy 15% 288.9%

Vanguard Emerg. Mkts. Index (VEIEX) Apr-03 $7.26 $27.99 Buy 10% 385.8%

Vanguard Europ. Stock Index (VEURX) Apr-03 $14.89 $31.42 Buy 10% 202.0%

Vanguard High-Yield Corp. Fund (VWEHX) Apr-03 $6.02 $5.93 Buy 10% 94.7%

Vanguard Inflation-Protected Securities Apr-03 $12.09 $13.18 Buy 10% 62.0% Fund (VIPSX)

Vanguard Pacific Stock Index (VPACX) Apr-03 $5.56 $13.80 Buy 10% 212.0%

Vanguard Short-Term Investment (VFSTX) Apr-03 $10.82 $10.64 Buy 10% 45.1%

Vanguard Prec. Metals and Mining (VGPMX) Apr-03 $9.98 $9.75 Buy 5% 180.4%

Vanguard REIT Index (VGSIX) Apr-03 $12.08 $28.04 Buy 5% 242.2%

Note: The Gone Fishin’ strategy requires annual rebalancing and does not require the use of trailing stops. These prices do not reflect dividends. ^ Adjusted buy price based on averaging down on March 1, 2016, at $63.29. Prices as of 12/12/17 | Note: For the absolute latest updates on all of The Oxford Communiqué’s portfolios, visit our website at www.oxfordclub.com.

The Oxford Communiqué’s portfolios fit into the Core Portfolio, Blue Chip Outperformers and Targeted Trading levels of the Oxford Wealth Pyramid. For more information, go here: www.oxfordclub.com/wealth-pyramid.

The Oxford Club, LLC provides its Members with unique opportunities to build and protect wealth globally under all market conditions. We believe the advice presented to Members in our published resources and CEO & Executive Director Julia Guth Managing Copy Editor Anne Mathews at our seminars is the best and most useful to global investors today. The recommendations and analysis Chief Investment Strategist Alexander Green Editorial Director Matthew Benjamin presented are for the exclusive use of Members. Members should be aware that investment markets have Chief Income Strategist Marc Lichtenfeld Director of Research Ryan Fitzwater inherent risks and there can be no guarantee of future profits. Likewise, past performance does not secure Art Director Alison Kassimir future results. Recommendations are subject to change at any time, so Members are encouraged to make Emerging Trends Strategist Matthew Carr regular use of our website, www.oxfordclub.com. Managing Editor Samuel Taube Graphic Designer Chelsea Centineo

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