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Sunday, November 9, 2008

Calls and Messages from Sanjay Dalal - Innovation Index Group

Dear Friends:

It has come to our attention that calls or messages were/are placed using the cell or office phone numbers of Innovation Index Group - numbers 949-466-8218 or 949-852-3534 (this may have been happening for some time now). We have contacted AT&T for the same, and they have taken some steps so that this should not occur again. Should you receive anonymous calls or messages from Sanjay Dalal's cell phone or office phone of Innovation Index Group, please kindly report this to us so that we can isolate and correct this problem. Suffice it to say, we apologize for the inconvenience caused due to these spurious calls and messages.

Sincere regards,
Sanjay Dalal
President & Managing Director
Innovation Index Group, Inc.

2600 Michelson Drive, Suite 1700
Irvine, CA 92612
Main: 949-852-3534
Cell: 949-466-8218
Fax: 949-861-9320

Active Member of the Irvine Chamber of Commerce
Active Member of Dean's Leadership Circle, The Paul Merage Business School, UC Irvine
Active Member of American Association of Individual Investors

Past performance does not guarantee future results. Refer to Innovation Index Fund Prospects for full details

Sunday, October 12, 2008

Statement of IIG Financial Condition - Innovation Index Group

Dear Current and Prospective IIG Investors:

Some of you may have thought about the financial condition of IIG (Innovation Index Group) and my personal financial condition, especially in this current economic climate. Rest assured, I have worked hard for 10 years in Silicon Valley, and through the options in various company stocks that I worked at and that we gained, and smart investments in the stock markets and through the equity we built in our Fremont home that we sold last year, we have amassed enough savings to last us another five to ten years at the very least. We also bought a house this summer in Turtle Rock. We are blessed and lucky to be in this position. Having said that, it behooves us to work hard to continue this growth and not just deplete our savings, and to that end, I am planning to become a CFP next year and open a full-blown independent investment practice, and my wife has also begun working full-time. We have done well, and have no plans to retire in our forties... perhaps in our fifties ;-) And on a separate note, we are mentally healthy too, and plan to stay that way for the rest of our lives ;-) We do many things to relax and enjoy each weekend and during the week.

So, if you are considering investing in the stock market or real estate, please consider IIG - Innovation Index Group and REIG - Real Estate Investing Group (newly launched) as your consistent partner for steady growth over the next five to ten years and beyond. Invest with Confidence and Grow your Wealth...

I am thankful and grateful to my partners in IIG and REIG, and all our friends, family members, and partners for your continuous support and belief.

Sincere regards,
Sanjay Dalal
President & Managing Director
October 12, 2008

*Past performance does not guarantee future results. Refer to Innovation Index Fund and Real Estate Investing Group Prospectus for full details

Sunday, July 20, 2008

Introducing The Innovation Index Fund

Dear Creativity And Innovation Driving Business Blog Subscribers:

Are you interested in making your money work smarter and grow faster, and achieve potential average returns over 25% a year?*

We have created a brand new private placement investment fund called:

The Innovation Index Fund

What is The Innovation Index Fund?

The Innovation Index Fund is a private investment fund where investors such as you can invest their monies in The Innovation Index. The Innovation Index Fund, LLC is managed by Innovation Index Group, Inc.

What is The Innovation Index?

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

What has been the performance of The Innovation Index?

The Innovation Index would have returned 174% over the last five years as per the historical performance model. This assumes equal investment in each stock of The Innovation Index as of December 31, 2001. An average of $100 invested in The Innovation Index on December 31, 2001 returned $274 as of December 29, 2006. By comparison, $100 invested in each of S & P 500, NASDAQ and Dow Jones Index only returned $124 as of December 29, 2006.

What is the performance of The Innovation Index in 2007?

The Innovation Index returned 66% in 2007 as per our performance model. The Innovation Index beats the major U.S. indices including the S & P 500, NASDAQ and Dow Jones. S & P 500 was up 4% for the year, NASDAQ was up 10% for the year and the Dow Jones Index was up 6% for the year.

Which companies comprise The Innovation Index?

Here are the the top 20 Innovators that comprise The Innovation Index for 2007 and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Dell Inc. - (NASDAQ: DELL)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NYSE: INTC)
International Business Machines Corp. - (NYSE: IBM)
Microsoft Corporation - (NASDAQ: MSFT)
Research In Motion Limited - (NASDAQ: RIMM)
Southwest Airlines Co. - (NYSE: LUV)
Starbucks Corporation - (NASDAQ: SBUX)
Target Corp. - (NYSE: TGT)
The Proctor & Gamble Company - (NYSE: PG)
Wal-Mart Stores, Inc. - (NYSE: WMT)
Yahoo! Inc. - (NASDAQ: YHOO)

The Innovation Index Group will analyze the positions and standings of the top 20 Innovators at the end of each year, and make changes for 2008.

The Top 20 Innovators for 2008 were announced on December 31, 2007. Here is the alphabetical list of the Top 20 Innovators for 2008:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
AT&T Inc. - (NYSE: T)
Best Buy Co., Inc. - (NYSE: BBY)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Costco Wholesale Corporation - (NASDAQ: COST)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NYSE: INTC)
International Business Machines Corp. - (NYSE: IBM)
Merck & Co., Inc. - (NYSE: MRK)
McDonald's Corporation (NYSE: MCD)
Microsoft Corporation - (NASDAQ: MSFT)
NIKE, Inc. - (NYSE: NKE)
Research In Motion Limited - (NASDAQ: RIMM)
The Proctor & Gamble Company - (NYSE: PG)

How do I find out more information on the Innovation Index?

We have created a brand new website that provides all the relevant information about the Innovation Index, the performance, our selection process, founding principles, history and more.

Please browse to:
http://www.innovationindexgroup.com/

How do I learn more and invest in The Innovation Index Fund?

You need to first contact us to obtain more information about the Innovation Index. We will then contact you with the relevant details about the Innovation Index Fund and the prospectus. We will keep your contact information completely confidential, and only use it to contact you about The Innovation Index Fund and the associated information.

You can also email us at: info@innovationindexgroup.com

Or if you prefer, you can fill out the contact form at the bottom of the page here:
http://www.innovationindexgroup.com/invest.html

Are my investments completely safe in The Innovation Index Fund?

No. The Innovation Index invests in the stocks of the top 20 innovators in North America, and stocks can lose value. Historically, The Innovation Index would have returned average annual performance gains of over 34% a year for the past five years. However, the investments are not FDIC insured, and have no bank guarantee. Investments may lose value including the principal. Past performance does not guarantee future results.

Next steps:

If you are a serious accredited investor who wants to put your hard earned money to work smarter and grow faster and beat the stock market, email us at:

info@innovationindexgroup.com

Include your full name, phone number and address.

I look forward to your response.

Sincere regards,

Sanjay Dalal
President and Managing Director
Innovation Index Group, Inc.

*Past Performance Does Not Guarantee Future Results

Sunday, July 13, 2008

To Sell Or Not To Sell? You Decide.

If you are an investor in the stock market or real estate, are you considering selling your investments because of the current market conditions?

The major U.S. indices are down more than 20% from the recent peak set in October, 2007 - officially marking the return of the Bear market. Oil is more than $145 a barrel, and showing a real impact at the gas station when you take your car for a fill-up. Real estate prices are back to 2004 levels, or perhaps even 2003 or 2002. Foreclosures, Short sales, Auctions and Loan Defaults are accelerating, and going through the roof. Countrywide, the nation's largest home lender, was acquired by Bank of America earlier in the year; then it was Bear Sterns that had one last gasp, before getting a bail-out from JP Morgan and Federal Reserve; last Friday, IndyMac, one of the largest lenders in the nation and California, went bankrupt and closed doors. And there are rumors on whether Freddie and Fannie will survive through this mess. Oh my!

Your hard-earned money has perhaps lost 10%, 20%, 30% or even more than 50% owing to investments in the stock market or real estate.

What do you do?

Do you sell or hold on to your investments? Or do you double down?

This is perhaps the toughest question you would need to answer.

History shows that markets go through cycles of expansion, peak, contraction, consolidation, expansion, peak.... bull markets and bear markets. For instance, after the dot-com meltdown, we had an unprecedented boom that began in 2002 and lasted through 2007 - over five years. The bear market had lasted about two years prior to that. Whereas the last bear market had to do with the collapse from the dot-com euphoria and companies who lacked fundamentals, the current bear market is driven by larger macro-economic factors impacting the nation whole.

Fundamentally, except for the financial companies who had exposure to mortgages and sub-primes, most of the sectors are doing equal or better than they did in 2007. This is HUGE! However, Wall Street's business is driven by finance - and when the going was good, many Wall Street firms doubled up on the risky bets of the derivatives, sub-primes and mortgages. And they paid a dear price! The smart firms such as Goldman Sachs actually made money. Now some of the Wall Street firms want to save their face, and also make up for the huge losses. One way to do this is spread fear, talk the bear talk, get inside the investors' psyche, bet down the entire market - and make money as the markets go down. Someone has to panic as markets go down - the ones who panic the most are not the large Wall Street firms - instead, they are the individual investors who can't stomach the losses on their portfolio, and sell out while the chips are down. While the individual investors are selling at lowered prices, large hedge funds and institutions are making money.

So should you sell out now, or wait?

If you have invested in companies with great fundamentals, solid operations, sound management, and if these companies are still growing or holding steady in these tough economic times, you should have the strength of conviction and hold on to your investments. Just ask two questions - are they going to be around tomorrow, and are they going to be stronger than what they are today? Perhaps, you want to invest more if you believe in their future.

What are some of these top companies? GE, P&G, 3M, IBM, Apple, HP, Intel, J&J are just a few companies who have withstood economic and market downturns for the past decades. Newer bell-weathers include Cisco, Microsoft, McDonald's, Costco, Nike, Amazon.com, eBay, the new AT&T, RIM, Google and more.

An often repeated stock market mantra is to "sell in May and go away." One often forgotten fact is historically the market has performed differently - "better" - in presidential election years.

A recent chart by Chart of the Day details the performance of the Dow Jones Industrial Average in election years.

Dow Jones Industrial Average performance in election years

Source: Chart of the Day

As Chart of the Day notes:

With the 2008 presidential campaign now in full swing, today's chart illustrates how the stock market has performed during the average election year. Whether the average election year is measured from 1980 or 1900, the market has tended to struggle during the first five months of an election year. That initial subpar performance was then followed with a rally (on average) right up to the November election. One theory to support this election year stock market behavior is that the first five months of choppiness is due in part to the uncertainty of the outcome of the presidential election (the market abhors uncertainty) with the market beginning to rally as the outcome of the election becomes increasingly evident.

If some of your other investments are making money, it may be a good idea to balance them with the ones that are losing money towards the end of the year.

To Sell or Not to Sell? You Decide.

About Innovation Index Group:

Innovation Index Group, Inc. is a new research company focused on systematically identifying, tracking, researching and reporting on the most innovative publicly traded companies in North America – collectively called the Innovation Index. Over the past six years, the Innovation Index would have generated a gross average annual return of 40% based on historical model.*

The Innovation Index Reports:
Introducing The Innovation Index - Learn about the Innovation Index
Innovation Index Group BUY Recommendations - 2008 BUY Recommendations and Estimates
Q1 2008 Report - Innovation Index ahead of S&P 500 - Q1, 2008 Report
The Innovation Index closes 2007 at 66% - 2007 Annual Report on the Innovation Index
Top 50 Innovative Companies in the world - 2007 Report on Top 50 Innovative Companies
Annual Report - Chapter One - Total Innovation Activity - 2006 Annual Report One
Annual Report - Chapter Two - The Top Innovator - 2006 Annual Report Two
Annual Report - Chapter Three - The Innovation Insights - 2006 Annual Report Insights
Innovation and Stock Performance Correlation - The Innovation Index and Stock Performance
Future earnings guidance, A leading indicator - Earnings Guidance and Stock Price
Smart Investing In Tough Economic Times - Guide to Prudent, Value Investing

About The Innovation Index

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

The Innovation Index returned 66% in 2007 based on performance model, and would have returned 174% over the previous five years (2002-2006) based on historical model*. This assumes equal investment in each stock of The Innovation Index as of December 31, 2001. An average of $100 invested in The Innovation Index on December 31, 2001 returned $454 as of December 31, 2007. By comparison, $100 invested in S & P 500 returned 28% or $129, $100 invested in NASDAQ returned 34% or $136, and $100 invested in the Dow Jones Index returned 30% or $131 through December 31, 2007. The Innovation Index beats the S & P 500, NASDAQ and Dow Jones Index by more than seven times over the past six years.*

Alphabetical list of the Top 20 Innovators of The Innovation Index for 2008 and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
AT&T Inc. - (NYSE: T)
Best Buy Co., Inc. - (NYSE: BBY)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Costco Wholesale Corporation - (NASDAQ: COST)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NASDAQ: INTC)
International Business Machines Corp. - (NYSE: IBM)
Merck & Co., Inc. - (NYSE: MRK)
McDonald's Corporation (NYSE: MCD)
Microsoft Corporation - (NASDAQ: MSFT)
NIKE, Inc. - (NYSE: NKE)
Research In Motion Limited - (NASDAQ: RIMM)
The Proctor & Gamble Company - (NYSE: PG)

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invested in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

References:
Source: Sphere: Related Content David Templeton, CFA

Wednesday, June 4, 2008

Innovation Index gains 12.23% in April and May 2008, beats major U.S. indices

	Apr-08	May-08	Total*	YTD
Innovation Index Fund	6.30%	5.58%	12.23%	8%
S&P 500	4.75%	1.07%	5.87%	-6%
Dow Jones	4.54%	-1.42%	3.06%	-7%
Nasdaq	5.87%	4.55%	10.69%	-6%

*Compounded for April and May

Innovation Index Fund had a solid performance jump in April and May 2008. Innovation Index Fund delivered 12.23% compounded return in two months, and handily beat S&P 500 and Dow Jones indices. Overall, the Innovation Index Fund is up 8% in 2008 as of May 31, 2008, whereas the major U.S. indices have lost 6% or 7% in 2008.

Innovation Index Group remains bullish for the 4th quarter of 2008; however, our understanding of the current market conditions lead us to believe that there will be some road bumps along the way. Particularly, during the summer months, the market may tread sideways or even course correct in the interim.

Three factors are critical for a second half turnaround in U.S. economy and its positive impact on the stock markets:

1. Inflation - Gross inflation that includes gas, utilities and food needs to come under control. The consumer will feel the pinch of $4 or higher price per gallon of gas in the interim (yesterday, I filled up at the cost of $4.25 a gallon for gas) and higher cost of basic groceries such as bread, milk and fresh vegetables. Either the consumer will adapt to the higher price of gasoline, or react by reducing gas consumption and thereby decreasing travel. Reducing consumption and decreasing travel will negatively impact the economy. Adaptation to a higher fuel price will either result in replacement of current automobiles to higher mileage hybrids, decrease in discretionary spending elsewhere, utilization of public transport or carpools. This will take time, and neither of these alternatives appear to create a net positive impact on the economy. Finally, higher food prices would not deter the monthly consumption of groceries; however, the consumer will likely spend less money for other necessities or luxuries.

U.S. Federal Reserve Chairman Ben Bernanke said rising long-term inflation expectations were a "significant concern" for policy-makers but dismissed worry a wage-price inflation spiral was developing. "Some indicators of longer-term inflation expectations have risen in recent months, which is a significant concern for the Federal Reserve," Bernanke told graduating students at Harvard University. "We will need to monitor that situation closely."

He described overall inflation as "significantly higher than we would like," the second straight day in which he sounded a warning on inflation, which financial markets took as a firm signal that interest rates are likely on hold for some time.

2. Recession - U.S. employers shed 63,000 jobs in February 2008, the most in five years, 81,000 jobs in March and 20,000 jobs in April. How long will it take for the economy to turnaround and produce meaningful job growth? Would corporations go back to hiring mode in summer months or earlier? Which jobs will be in demand? So far, there are mixed signals on whether the economy is in recession or not, because the US economy actually grew in the first quarter by 0.6%.

Construction lost 61,000 jobs in April, and manufacturing shed 46,000 jobs. Retailers also trimmed payrolls by 27,000 in the face of a pullback in spending by consumers - CNN Money.

But some other sectors that had posted job losses in previous reports rebounded, such as business and professional services, which grew by 39,000 jobs after a loss of 44,000 the previous month. The financial sector, which has lost jobs each of the previous 8 months due to problems in the credit markets, ended that streak with a narrow 3,000 job gain. Unemployment rate actually improved to 5% in April 2008.

3. Housing and Financials - Some analysts call this period the "biggest slump in US housing".

Economist Glen Langan points out, "the unusual focus on subprime has caused the nation to overlook a broader trend regarding the housing sector -- namely, the psychology of the housing market."

"What we're not grasping yet, as a nation, is that even with programs to help people stay in their homes and avoid foreclosure, the public's stance toward the housing market has changed," Langan said. "The psychology of the housing market has changed. And this has little to do with at-risk mortgages. This a psychological shift among middle-income and upper-middle-income homeowners and taxpayers. It looks like they'll be sitting on the fence for a long period of time, and this will delay the housing recovery, hurting the economy in the process."

What's at the root of the psychological shift? Langan said factors that clearly indicate that tougher economic times are here and up ahead (higher oil prices, food prices, job lay-offs and little or no U.S. economic growth) combined with high home inventory levels -- about a 9.5- to 10-month supply at current sales rates -- telegraph to Americans that, unless you live in an oil boom town, median home prices are not going to recover any time soon, "not this year, and probably not in 2009."

According to this Bloomberg story, the number of Americans in danger of losing their homes to foreclosure rose to the highest in almost three decades during the first quarter as borrowers who fell behind on payments were unable to sell their homes.

New foreclosures rose to a seasonally adjusted 0.99 percent of all U.S. home loans, up from 0.83 percent in the fourth quarter, the Mortgage Bankers Association said in a report today. The total inventory of homes in foreclosure increased to 2.47 percent and the delinquency rate, loans with one or more payments overdue, grew to 6.35 percent. All were the highest since 1979, the Washington-based trade group said.

Falling home prices have stalled U.S. real estate sales, making it difficult for people who can't pay their mortgages to sell the properties. The increase in foreclosures was led by states with the biggest price declines over the past two years, said Jay Brinkmann, MBA's vice president of research and economics. California, Florida, Nevada and Arizona accounted for 89 percent of the gain in new foreclosures, he said.

Bottomline:

Inflation needs to be stalled, and then reversed. Recession may last another couple of quarters or more, or may show modest turnaround within the next year. Housing industry may take the longest to recover. The Fed and the government are busy trying to help in all these areas by increasing liquidity in the financial markets, lowering the interest rates, providing rebate checks to consumers and families, and also beginning the work towards strengthening the dollar. The sooner these three elements improve for the American consumer, the better the chances of an economic rebound in the fourth quarter of 2008, and a resulting growth in the stock market.

Innovation Index Group believes that the U.S. economy will recover in the 2nd half of 2008, and the Top Innovators of The Innovation Index will reward the patient, long-term investor. So far, most of the top innovators have delivered solid earnings during the first quarter of 2008 owing to the strengths and growth in their global business, new innovations spurring new business growth, maintenance of US earnings, and benefits from the currency fluctuations. It would be great to witness a spiraling growth of their US earnings in the 2nd half 2008.

Innovation Index Group has long-term BUY recommendations on the Top 20 Innovators of The Innovation Index.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index would have generated a gross average annual return of 40% based on historical model.* The Innovation Index returned 66% in 2007, and the Innovation Index Fund Manager is up 10% in 2008.*

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is an investment management company organized under the California state regulation, and is registered with Department of Corporations and SEC Regulation D.

The Innovation Index Reports:

Invest in The Innovation Index - Innovation Index Fund tracks The Innovation Index
The Innovation Index closes 2007 at 66% - 2007 Annual Report on the Innovation Index
Top 50 Innovative Companies in the world - 2007 Report on Top 50 Innovative Companies
Annual Report - Chapter One - Total Innovation Activity - 2006 Annual Report One
Annual Report - Chapter Two - The Top Innovator - 2006 Annual Report Two
Annual Report - Chapter Three - The Innovation Insights - 2006 Annual Report Insights
Innovation and Stock Performance Correlation - The Innovation Index and Stock Performance

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

Tuesday, June 3, 2008

Innovation Index Fund closes at 116.40, Up 8% in 2008

	3-Jun-08	Change		YTD
The Innovation Index
Fund Manager	116.40	-1.07	-0.91%	8%
S&P 500	1,377.65	-8.02	-0.58%	-6%
Nasdaq	2,480.48	-11.05	-0.44%	-6%
Dow Jones	12,402.85	-100.97	-0.81%	-6%

Innovation Index Fund closed today at 116.40, up 8% year to date.

Innovation Index Group has BUY recommendations on the Top 20 Innovators of The Innovation Index.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index would have generated a gross average annual return of 40% based on historical model.* The Innovation Index returned 66% in 2007, and the Innovation Index Fund Manager is up 10% in 2008.*

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is an investment management company organized under the California state regulation, and is registered with Department of Corporations and SEC Regulation D.

The Innovation Index Reports:

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

Thursday, May 22, 2008

Costco Continues Solid Double-Digit Growth

Costco Wholesale (NASDAQ: COST) is a Top Innovator at A Great Value

Costco Wholesale Corporation (NASDAQ: COST) is one of the Top 20 Innovators of The Innovation Index. Costco was added to The Innovation Index for 2008. Innovation Index Group rates Costco a Long-term Buy with Q4, 2008 price target of $80. Costco shares are up 1.4% year to date, and beat Dow Jones, NASDAQ and S & P 500 by a good margin.

Costco reported net sales of $5.54 billion for the month of April, the four weeks ended May 4, 2008, an increase of 12 percent from $4.94 billion in the same four-week period last year.

For the first thirty-five weeks of its reporting period ended May 4, 2008, the Company reported net sales of $46.88 billion, an increase of 12 percent from $41.90 billion during the similar thirty-five-week period last year.

Comparable sales growth for the four-week and thirty-five-week periods ended May 4, 2008, were as follows:

4 Weeks 35 Weeks -------------- --------------
US 7% 5%
International 14% 17%
Total Company 8% 8%
============== ==============

The U.S. comparable sales figure includes, among other things, the effect of gasoline price inflation, with the average sales price per gallon of gasoline up 17% for the four-week month of April, as compared to the year-earlier April. Excluding gasoline price inflation, U.S. comparable sales would have been up 5%. In addition, foreign exchange rates, primarily in Canada, positively impacted international comparable sales results. On a local currency basis, international comparable sales increased 6% in April.

Costco Innovations
Costco has grown its lead in key retail segments by offering great prices, convenience, and "treasure hunt" shopping atmosphere. In 2007, Costco generated $456 million of U.S. Fine Wine sales, racked up $1.9 billion in TV sales, had a growing electronics business, showed substantial increase in diamond business with sales of 105,000 carats, sold over $550 million of Seafood, grew the chicken business from practically nothing to $173 million, provided 27.9 million prescriptions through its pharmacy, sold over 2.4 million pairs of glasses, processed 1.3 billion prints through the One Hour photo service, and sold 69.3 million hotdog and sodas. What are the new innovative growth segments? Costco Gas, Costco Car Wash, Costco.com (online business), Costco Travel and Costco Home. Costco Home promises to provide high-end name brand furnishings for a home at the lowest price. We believe some of these new innovations from Costco will provide 2% to 5% incremental revenue and earnings growth in 2008 and beyond, and potentially grow into higher growth business segments in 2009.

Innovation Index Group rates Costco a Long-term Buy with Q4, 2008 price target of $80.

Bottomline:

Costco will be announcing its quarterly earnings on May 29. Innovation Index Group believes that the current valuation of Costco around $70 to $71 a share provides an attractive buying opportunity. Costco will continue its solid double-digit earnings and revenue growth through the rest of 2008.

The Innovation Index Fund Manager, that invests in Costco, is up 6% in 2008. The Top 20 Innovators of The Innovation Index have rebounded well in the 2nd quarter of 2008 to cause The Innovation Index Fund Manager to have positive gain for the year.

Innovation Index Group believes that the U.S. economy will recover significantly in the 2nd half of 2008, and the Top Innovators of The Innovation Index will reward the patient, long-term investor.

Innovation Index Group has BUY recommendations on the Top 20 Innovators of The Innovation Index.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index would have generated an annual compounded average gross return of 40% based on historical model.* The Innovation Index returned 66% in 2007, and the Innovation Index Fund Manager is up 10% in 2008.*

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is a private placement investment partnership organized under the California state regulations.

The Innovation Index Reports:

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

Tuesday, May 13, 2008

Innovation Index Fund Manager Up 10% in 2008

The Top 20 Innovators	Ticker	Dec 31, 2007	May 13, 2008	Quarterly	2008 %	2007 %
APPLE INC	AAPL	198.08	189.96	32%	-4%	133%
AMERICA MOVIL	AMX	61.39	56.90	-11%	-7%	36%
AMAZON INC	AMZN	92.64	74.56	5%	-20%	135%
BEST BUY INC	BBY	52.51	43.63	5%	-17%	6%
COSTCO WHSL CORP	COST	69.60	73.98	14%	6%	33%
CISCO SYS INC	CSCO	27.07	25.89	7%	-4%	-1%
EBAY INC	EBAY	33.19	31.41	5%	-5%	10%
GENERAL ELECTRIC CO	GE	36.74	32.33	-13%	-12%	0%
GOOGLE INC	GOOG	691.48	583.00	32%	-16%	50%
HEWLETT PACKARD CO	HPQ	50.48	44.27	-3%	-12%	23%
IBM	IBM	107.69	126.58	10%	18%	12%
INTEL CORP	INTC	26.50	23.76	12%	-10%	32%
MCDONALDS CORP	MCD	58.51	61.17	10%	5%	34%
3M CO	MMM	84.32	77.18	-2%	-8%	9%
MERCK & CO INC	MRK	57.61	39.17	3%	-32%	35%
MICROSOFT CORP	MSFT	35.46	29.78	5%	-16%	20%
NIKE INC	NKE	64.00	65.66	-3%	3%	30%
PROCTER & GAMBLE CO	PG	73.05	65.73	-6%	-10%	15%
RESEARCH IN MOTION LTD	RIMM	113.40	140.84	25%	24%	166%
AT&T INC	T	41.16	39.26	3%	-5%	19%

Innovation Index Fund Manager		108.27	118.56		10%	66%
S & P 500	^GSPC	1,468.36	1,403.04	6.07%	-4%	3.5%
NASDAQ	^IXIC	2,652.28	2,495.12	9.48%	-6%	9.8%
Dow Jones	^DJI	13,264.82	12,832.18	4.64%	-3%	6.4%
© Innovation Index Group, Inc. http://www.InnovationIndexGroup.com

The Innovation Index Fund Manager is up 10% in 2008. The Top 20 Innovators of The Innovation Index have rebounded well in the 2nd quarter of 2008 to cause The Innovation Index Fund Manager to have double-digit gain for the year. The Fund Manager increased positions in some of these innovators in March 2008, and it is this increase in net positions that created the double-digit performance jump. Apple, Google, RIM, Costco, IBM, Intel and McDonald's have each delivered 10% or higher return this quarter. Apple and Google lead all innovators with 32% appreciation in the 2nd quarter. Overall, five innovators are in the green for all of 2008 - Costco, IBM, McDonalds, Nike and RIM. The major U.S. indices are down anywhere from 3% to 6% in 2008.

Innovation Index Group believes that the U.S. economy will recover significantly in the 2nd half of 2008, and the Top Innovators of The Innovation Index will reward the patient, long-term investor.

Innovation Index Group has BUY recommendations on the Top 20 Innovators of The Innovation Index.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index would have generated a gross average annual return of 40% based on historical model.* The Innovation Index returned 66% in 2007, and the Innovation Index Fund Manager is up 10% in 2008.*

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is a private placement investment partnership organized under the California state regulations.

The Innovation Index Reports:

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

Monday, May 12, 2008

RIM Tests New Highs - Launches New BlackBerry Bold Smartphone

Research In Motion (RIM) (NASDAQ: RIMM) announced the all new BlackBerry(R) Bold(TM) smartphone, to be released in Summer 2008. RIM is one of the Top 20 Innovators of The Innovation Index.

"The Bold is the first BlackBerry smartphone to support tri-band HSDPA high-speed networks around the world and comes with integrated GPS and Wi-Fi(R), as well as a rich set of multimedia capabilities."

Bold is the first 3G phone from Blackberry.

Bold Promises Superior Performance

"The BlackBerry Bold smartphone's support for tri-band HSDPA and enterprise-grade Wi-Fi (802.11 a/b/g) networks and its next-generation 624 MHz mobile processor" promise higher performance when downloading email attachments, streaming video or browsing multimedia web pages. "The BlackBerry Bold also includes 128 MB Flash memory plus 1 GB on-board storage memory, as well as a microSD/SDHC memory card slot(ii) that is conveniently accessible from a side door."

Bold has Improved Display

"The BlackBerry Bold smartphone comes with the most vivid and bold display ever introduced on a BlackBerry smartphone. Its half-VGA (480x320 resolution) color LCD is fused to the undersurface of the lens, making images leap out with stunning definition and clarity."

Bold provides Better Browsing

"With its newly enhanced, high performance browser and high-resolution, ultra-bright display, the BlackBerry Bold smartphone gives users an on-the-go web browsing experience with desktop-style depiction.... There is support for watching streaming videos (RTSP - real-time streaming protocol)."

Bold has Integrated Multimedia and Support for iTunes and USB 2.0

"The BlackBerry Bold features a 2 megapixel camera with video recording capability, built-in flash and 5x digital zoom. The enhanced media player can display pictures and slideshows quickly, play movies smoothly in full screen mode, and manage an entire music collection...

For managing music and video, the BlackBerry(R) Desktop Manager software includes Roxio(R) Media Manager for BlackBerry(R) as well as Roxio Photosuite(R) 9 LE, which makes it easy to enhance pictures and create photo albums on the computer. For users that manage their collection with iTunes(R), the new BlackBerry(R) Media Sync application provides a simple way to sync iTunes digital music collections with the smartphone(iii). Support for High Speed USB 2.0 allows all files to be transferred quickly from a desktop computer to the BlackBerry Bold smartphone."

Bold supports built-in WI-FI and GPS - Finally!

"The BlackBerry Bold smartphone supports the 802.11 a/b/g Wi-Fi standards, ideal for use in enterprise or campus wireless LAN deployments, over Wi-Fi hotspots and on wireless home networks. A new "Push Button Setup" is included, making it faster for users to connect to protected wireless networks that require a sign on process.

Through its integrated GPS, the BlackBerry Bold smartphone can pinpoint its exact location, supporting applications like BlackBerry(R) Maps and other location-based applications or services. With its improved rendering capabilities, faster download speeds and ability to support simultaneous voice and data, the BlackBerry Bold smartphone even allows users to navigate while on a call."

Bold is a Better Phone

"The BlackBerry Bold smartphone features a new acoustic design that increases the size of the phone's audio sweet spot, improving listening quality and clarity. It also comes with numerous premium phone features including Speaker Independent Voice Recognition (SIVR) for Voice Activated Dialing (VAD), Bluetooth(R) 2.0, with support for hands-free headsets, stereo headsets, car kits and other Bluetooth peripherals. It is a quad-band EDGE and tri-band HSDPA handset that supports global roaming(iiii) and features dedicated 'send', 'end', and 'mute' keys, smart dialing, speed dialing, conference calling and call forwarding. It also features noise cancellation technology that offsets background noise, a powerful speaker phone and support for polyphonic, mp3 and MIDI ring tones."

Bold has Always-On Email & Messaging

"Bold works with BlackBerry(R) Enterprise Server, which enables advanced security and IT administration within IBM(R) Lotus(R) Domino(R), Microsoft(R) Exchange and Novell(R) GroupWise(R) environments, as well as BlackBerry(R) Professional Software for small businesses. It also works with BlackBerry(R) Internet Service, which gives users access to up to 10 work or personal email accounts (including most popular ISP email accounts), and the BlackBerry(R) Unite! software for SOHO and home users."

"With this powerful new smartphone, users can even talk on the phone while sending and receiving email or accessing the web, and download Word, Excel or PowerPoint files and edit them directly on the handset using the preloaded DataViz(R) Documents to Go(R) suite."

Bottomline:

RIM is up about 7% today, and has broken through the 52-week high. RIM has set a new all-time high share price of $142.13 on the news of RIM's new Bold.

Although the new Bold does not have the Touch-screen of the Apple iPhone, and may pale slightly in head-to-head feature comparison with the soon to be launched Apple iPhone 2.0, the new 3G iPhone from Apple, RIM has fired a solid early answer to Apple. RIM is after all the 800-lb gorilla in the smartphone market. RIM also announced a new $150 million venture capital fund to invest in mobile applications and services for the BlackBerry(R) platform and other mobile platforms, in the same vein as Apple's announced $100 million venture fund with Kleiner Perkins. RIM is essentially telling the business world and the Wall Street that the BlackBerry will not take a passenger's seat to Apple's iPhone. Rather, it wants to take the driver's seat, and wants to take on the Apple iPhone onslaught head-on. Can the new Bold provide the answer RIM is seeking to the new iPhone? Can the new Bold stall iPhone's emergence in the smartphone market? The winners are all the smartphone buyers and consumers, since RIM is about to give all these buyers a worthy choice - a smartphone that has almost all the features that an iPhone has except the touch screen - with a keyboard.

Apple Inc. (NASDAQ: AAPL) is also a Top 20 Innovator of The Innovation Index.

Innovation Index Group has a BUY recommendation on both RIM and Apple.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index would have generated a gross average annual return of 40% based on historical model.* The Innovation Index returned 66% in 2007, and the Innovation Index Fund is up 8% in 2008.*

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is a private placement investment partnership organized under the California state regulations.

The Innovation Index Reports:

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results

References:
Company Press Releases

Wednesday, April 16, 2008

IBM, eBay and Intel have investors rejoicing

IBM (NYSE: IBM) and eBay Inc. (NASDAQ: EBAY) reported their first quarterly earnings for 2008 after market close today, and Wall Street which was already in an upbeat mood from Intel's (NASDAQ: INTC) positive earnings report yesterday, rejoiced even further. IBM beat the quarterly earnings, and raised the 2008 guidance. IBM shares were up about 3% in after hours for a total daily gain of about 6%. IBM shares are already up 11.44% in 2008 (without counting after hours activity). eBay shares were also up today on the broad market rally, and are only down 3.22% for the year. eBay posted a solid 22 percent rise in quarterly net profit, topping Wall Street's average estimate, and importantly, cautiously raised its 2008 revenue target. Yesterday, Intel reported quarterly earning that beat the lowered estimates, and raised the second quarterly guidance. This was enough to start the tech rally today, that extended into optimism across the board. Intel shares were up nearly 6% today, and gained more in after hour trading. Intel shares are down 17% for the year though.

IBM, eBay and Intel are three of the Top 20 Innovators of The Innovation Index. Innovation Index Group has a BUY recommendation for these Innovators.

The Innovation Index closed today at 100.51, up 2.05 points.

In Future Earnings Guidance, I had talked about the importance of earnings guidance, and its impact on short term stock price. IBM had provided an upbeat guidance in January, 2008, and hence its stock began to appreciate after the quarterly report (although was down 14% early in the year). IBM has not only erased the entire negative performance, it is up 11.44% for the year.

Excerpts from various company press releases:

IBM (NYSE: IBM) announced first- quarter 2008 diluted earnings of $1.65 per share from continuing operations compared with diluted earnings of $1.21 per share in the first quarter of 2007, an increase of 36 percent as reported. First- quarter income from continuing operations was $2.3 billion compared with $1.8 billion in the first quarter of 2007, an increase of 26 percent. Total revenues for the first quarter of 2008 of $24.5 billion increased 11 percent (4 percent, adjusting for currency) from the first quarter of 2007.
"IBM had a very good quarter, and a good start to 2008. These results reinforce our confidence in IBM's ability to perform well in a dynamic global economy. ....," said Samuel J. Palmisano, IBM chairman, president and chief executive officer.
"IBM is a different company today, with a number of unique advantages: our global reach and scale, our strength in profitable growth segments, strong recurring revenue and profit streams, products and services that create real value for clients, and the discipline and financial strength and flexibility that enables us to adjust our business model as conditions require.
"We feel good about the rest of the year."
eBay Inc. (Nasdaq:EBAY) today reported financial results for its first quarter ended March 31, 2008. The ecommerce company posted first quarter revenue of $2.19 billion, up $424 million from the same period last year. Revenue growth was driven primarily by Marketplaces net transaction revenues, the ongoing expansion at PayPal, Skype and the company's global classifieds business. The company's global footprint helped it benefit from strength in other currencies, relative to the U.S. dollar. The company recorded net income on a GAAP basis of $460 million or $0.34 per diluted share, and non-GAAP net income of $562 million or $0.42 per diluted share.

"This was a very strong financial quarter for the company," said eBay Inc. President and CEO John Donahoe. "The results reflect the strength provided by our diverse portfolio of businesses. Our stability and growth continues to give us the confidence to make innovative changes to our products to keep customers engaged for years to come."
Intel Corporation yesterday announced record first-quarter revenue of $9.7 billion, operating income of $2.1 billion, net income of $1.4 billion and earnings per share (EPS) of 25 cents.
"Our first quarter results demonstrate a strengthening core business and a solid global market environment," said Paul Otellini, Intel president and CEO. "We saw healthy demand for our leading-edge processors and chipsets across all segments. Looking forward, we remain optimistic about our growth opportunities as we continue to reap the benefits of our 45nm technology leadership."

Bottomline:

IBM, eBay and Intel have definitely showed resiliency in current economic conditions; not only have they found a way to grow their business in these conditions, they have also raised their future financial outlook. This speaks volumes. This is what sets true innovators apart. IBM, eBay and Intel are able to sell their products, create new markets and new growth opportunities, and execute. Specifically, Intel has excelled with the 45nm technology leadership and the resulting processor products, eBay with Marketplaces business model innovation, and the ongoing expansion at PayPal, Skype and the company's global classifieds business, IBM with total Global Services revenues growth of 17% and the closed acquisition of Cognos growing the revenues for Information Management software by a significant 27 percent. IBM grew the total software segment revenue by 14% from last year.

IBM, eBay and Intel could quite possibly fuel a BULL market rally, and perhaps put the Bears to rest.

About Innovation Index Group:

Innovation Index Group, Inc. is a new investment management company focused on systematically identifying, tracking and investing in the most innovative publicly traded companies in North America – collectively called the Innovation Index. We have developed the Innovation Index Fund, LLC as our first vehicle to invest in the Innovation Index. Over the past six years, the Innovation Index has generated a gross average annual return of 40%.

Innovation Index Group, Inc. and Innovation Index Fund LLC are registered California Corporations, and member of the Irvine Chamber of Commerce in Orange County. Further, Innovation Index Fund LLC is a private placement investment partnership organized under the California state regulations.

The Innovation Index Reports:

About The Innovation Index

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

The Innovation Index returned 66% in 2007, and returned 174% over the previous five years (2002-2006). This assumes equal investment in each stock of The Innovation Index as of December 31, 2001. An average of $100 invested in The Innovation Index on December 31, 2001 returned $454 as of December 31, 2007. By comparison, $100 invested in S & P 500 returned 28% or $129, $100 invested in NASDAQ returned 34% or $136, and $100 invested in the Dow Jones Index returned 30% or $131 through December 31, 2007. The Innovation Index beats the S & P 500, NASDAQ and Dow Jones Index by more than seven times over the past six years.*

Alphabetical list of the Top 20 Innovators of The Innovation Index for 2008 and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
AT&T Inc. - (NYSE: T)
Best Buy Co., Inc. - (NYSE: BBY)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Costco Wholesale Corporation - (NASDAQ: COST)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NYSE: INTC)
International Business Machines Corp. - (NYSE: IBM)
Merck & Co., Inc. - (NYSE: MRK)
McDonald's Corporation (NYSE: MCD)
Microsoft Corporation - (NASDAQ: MSFT)
NIKE, Inc. - (NYSE: NKE)
Research In Motion Limited - (NASDAQ: RIMM)
The Proctor & Gamble Company - (NYSE: PG)

The Innovation Index will analyze the positions and standings of the Top 20 Innovators at the end of each year. For 2008, there will be no further changes in The Innovation Index.

Disclaimer: The Innovation Index Group, Inc. invests in the stocks comprising The Innovation Index.
*Past Performance Does Not Guarantee Future Results