<div class="KonaFilter image-container float_right"><div class="image">REUTERS/Andrew KellyStylist Faustina Rose waits for the commencement of the Katya Zol 2014 Fall/Winter collection presentation during New York Fashion Week in New York February 9, 2014.</div></div>There were no notable economic reports or earnings announcements released today. There wasn't a whole lot of action in the markets either.
First, the scoreboard:
<ul>
<li>Dow: 15,801.5 (+7.4, +0.0%)</li>
<li>S&amp;P 500: 1,799.7 (+2.7, +0.1%)</li>
<li>Nasdaq: 4,148.1 (+22.3, +0.5%)</li>
</ul>
And now the top stories:
<ul>
<li>Today's calm was a welcome one given the recent volatility in the markets. On this quiet day, <a href="http://www.raymondjames.com/inv_strat.htm">Raymond James' Jeff Saut</a> offers some poetic investment wisdom: "In the world we live in, few look at risk. Most only look at reward. The few who do look at risk (the educated, the street savvy) make their money at the expense of the great unwashed majority who swallow the noise nonsense about getting rich quick. Investing is a get rich slowly process. You have to put your money at risk in the face of uncertainty. Emotions run rampant before the uncertainty of floating, fluctuating, often violent and volatile markets..."</li>
<li>But for those who can't resist the prospect of making a short-term buck, veteran market strategist <a href="http://www.businessinsider.com/laszlo-birinyi-stocks-will-take-off-2014-2">Laszlo Birinyi believes the S&amp;P 500</a> will be at 1,900 by the second quarter. That represents an ambitious 6% gain from current levels. "We've had a little bit of a detour and the road isn't as smooth as it has been, but we still think the rally is intact," Birinyi told Bloomberg.</li>
<li>According to Fannie Mae, 52% of Americans believe it is <a href="http://www.businessinsider.com/fannie-mae-mortgage-survey-2014-2">easy to get a mortgage</a>. This is the highest level seen in the three and a half years Fannie has been conducting this survey. "The gradual upward trend in this indicator during the last few months bodes well for the housing recovery and may be contributing to this month's increase in consumers' intention to buy rather than rent their next home," said Fannie Mae's Doug Duncan. </li>
<li>Don't Miss: <a href="http://www.businessinsider.com/us-cities-growing-4-2014-2">The 12 Fastest-Growing Cities In America »</a></li>
</ul>

STOCKS GO NOWHERE: Here's What You Need To Know

<div class="KonaFilter image-container display-table"><div><div class="image">AP</div></div></div>A lawyer for the campaign of Mississippi Republican state Sen. Chris McDaniel hinted the campaign was preparing a legal challenge to contest the results of a June 24 Republican primary runoff election. 
Mitch Tyner, the lawyer, said at a press conference Monday the McDaniel campaign would seek a new election between McDaniel and U.S. Sen. Thad Cochran, who prevailed over McDaniel in the June 24 runoff.
"The correct remedy is a new election," Tyner told reporters Monday afternoon outside the Hinds County Courthouse in Raymond, Mississippi. 
Tyner said it was "very likely" an official challenge to the runoff election results would be filed in the "coming days." McDaniel <a href="http://www.businessinsider.com/mcdaniel-legal-challenge-cochran-mississippi-senate-runoff-2014-7" target="_blank">has refused to concede in the wake of the runoff election</a>, refusing to put out the flame on what has been called the nastiest election fight in America. 
The McDaniel campaign has claimed it has found thousands of voter "irregularities," as well as a number of illegal "crossover" votes from Democrats who shouldn't have been allowed to vote in the June 24 Republican primary runoff. The Cochran campaign has said that McDaniel's team has yet to provide any hard evidence of illegitimate votes - and that its claims of large numbers of "voter irregularities" are largely exaggerated.
Tyner said Monday he didn't "know the exact number" of voting irregularities the McDaniel campaign had found. But he said the campaign didn't necessarily need to come forward with 6,700 such votes - the approximate margin of victory for Cochran in the runoff.
"I would be surprised if we don't" find that amount, he said.
According to Mississippi law, voters do not have to register with a political party. Any person who doesn't case a vote in a primary election can cast a ballot in either party's runoff.
Cochran campaign spokesman Jordan Russell released a preemptive statement ahead of Tyner's press conference, saying the campaign had dispatched representatives to all 82 counties and Mississippi. Russell said the results reported revealed an "extremely low number of crossover votes."
"As the process moves forward, the conversation is shifting from wild, baseless accusations to hard facts. As we have said from the beginning, the run-off results are clear: the majority of Mississippians voted for Senator Thad Cochran," Russell said.
McDaniel's campaign has been weighing a legal challenge since the June 24 runoff. Last week, he announced he was <a href="http://www.businessinsider.com/mcdaniel-legal-challenge-cochran-mississippi-senate-runoff-2014-7" target="_blank">forming an "election challenge fund" to contest what he called a "corrupt" election</a>. And last Thursday, his campaign announced rewards of $1,000 each to individuals providing "evidence leading to the arrest and conviction of anyone involved in voter fraud," a move Russell told Business Insider was a "frivolous, baseless stunt."
<div>"If they had information of actual voter fraud, they wouldn't be doing that," Russell said. "It's such a joke."</div>

After Two Rounds Of Voting, Mississippi's Tea Party Candidate Wants A Whole New Election

<div class="KonaFilter image-container float_right"><div class="image on-image">Robertus Pudyanto/Getty Images) </div></div>FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
<a href="http://www.fa-mag.com/news/raymond-james-offers-12-financial-resolutions-for-2014-16450.html">Raymond James Thinks Investors Should Stick With These 12 Resolutions In 2014 If They Want To Meet Their Financial Goals</a> (FA MAg) 
Raymond James is out with 12 financial resolutions for 2014. 1. Update your balance sheets, asses your goals and see what adjustments you need to make to meet them. 2. "Review your budget and spending habits." 3. Make sure you have titled your estates properly. 4. Make sure you have updated your beneficiaries. 5. Make sure you have "easily accessible cash reserves for six months." 6. Make sure your asset allocation is in keeping with your financial goals and that you are comfortable with your risk exposure. 7. Evaluate how secure your sources of retirement income are. 8. Make sure your social security returns are correct. 9. "Review the tax efficiency of your charitable giving." 10. Make sure your retirement plan is on track and if it isn't assess the changes you need to make. 11. Make adjustments to your portfolio if needed. 12. Make an appointment with your advisor to review your portfolio. 
<a href="http://www.bloomberg.com/news/2013-12-27/a-fund-that-invests-like-buffett.html">Scott Moore's Fund Invests Like Buffett</a> (Bloomberg News)
Warren Buffett famously said, "put all of your eggs in one basket and then watch that basket." Bloomberg News' Lewis Braham thinks Scott Moore, founder of Nuance Investments follows this principle quite closely. "It is a classic value strategy similar to Warren Buffett's except we don't hold companies forever like him," Braham told Bloomberg. "We're trying to identify businesses that are No 1 or No. 2 in market share in their industries. We do a thorough analysis to see if they have a sustainable competitive advantage. "
"We try to buy them when there's a transitory problem causing their earnings power to be depressed below normal levels. We calculate what the stock should be worth when earnings recover to normalized levels and what the worst case scenario could be. If the potential reward far exceeds the downside risk, we buy."
<a href="http://www.businessinsider.com/negative-to-positive-earnings-preannouncements-2013-12">The Upcoming Earnings Season Will Be Interesting</a> (Business Insider)<a href="http://www.businessinsider.com/negative-to-positive-earnings-preannouncements-2013-12"> </a>
For Q4 2013, 94 companies have issued negative earnings guidance, though the amount by which the companies have lowered expectations has been below average, according to FactSet's John Butters. Meanwhile 13 companies issued positive EPS guidance. "The market has reacted negatively in aggregate to the negative EPS announcements issued by S&amp;P 500 corporations during the fourth quarter," he wrote. "For the 94 companies that have issued negative EPS guidance for Q4 2013 to date, the average price change (2 days before the guidance was issued through 2 days after the guidance was issued) was -1.5%. This percentage is nearly double the average of -0.8% recorded over the past five years."
Interestingly however the market also reacted negative to positive EPS announcements issued by S&amp;P500 companies in Q4. "Of the 13 companies that have issued positive EPS guidance for Q4 2013, the average price change (2 days before the guidance was issued through 2 days after the guidance was issued) was -0.1%. This percentage is well below the average over the past five years of +3.0%. In fact, this marks the first time since Q4 2008 (-0.2%) that the average price change for companies issuing positive guidance has been negative."
<a href="http://www.businessinsider.com/barry-ritholtz-2014-market-predictions-2013-12">Barry Ritholtz's Official 2014 Market Predictions Are Out, And They're Brilliant</a> (The Big Picture)<a href="http://www.businessinsider.com/barry-ritholtz-2014-market-predictions-2013-12"></a>
Barry Ritholtz put out his 2014 predictions. Here's a breakdown for the U.S.
<table style="width: 703px; height: 333px;">
<tbody>
<tr>
<td valign="top" width="221">Category</td>
<td valign="top" width="221">Forecast</td>
</tr>
<tr>
<td valign="top" width="221">Dow Jones Industrials</td>
<td valign="top" width="221">No idea</td>
</tr>
<tr>
<td valign="top" width="221">S&amp;P500</td>
<td valign="top" width="221">WTF are you asking me for?</td>
</tr>
<tr>
<td valign="top" width="221">10 Year Bond</td>
<td valign="top" width="221">Could not fathom a guess</td>
</tr>
<tr>
<td valign="top" width="221">Fed Fund Rates</td>
<td valign="top" width="221">Haven't a clue</td>
</tr>
<tr>
<td valign="top" width="221">US Housing Market</td>
<td valign="top" width="221">That's a really good question</td>
</tr>
<tr>
<td valign="top" width="221">Inflation</td>
<td valign="top" width="221">Not a clue</td>
</tr>
<tr>
<td valign="top" width="221">GDP</td>
<td valign="top" width="221">Yes, we will probably have a GDP</td>
</tr>
<tr>
<td valign="top" width="221">Unemployment</td>
<td valign="top" width="221">Thhhhpppptttt?</td>
</tr>
<tr>
<td valign="top" width="221">Possibility of Recession in 2014</td>
<td valign="top" width="221">Possibility &amp; Probability are 2 different things</td>
</tr>
</tbody>
</table>
Essentially that's just Ritholtz saying it's a fools game to predict what will happen in the near term.

FINANCIAL ADVISOR INSIGHTS: Sticking With These 12 Resolutions Will Help Investors Meet Their Financial Goals

<keyword id="410443" type="PERSON" weightage="20" keywordseo="Suhas-Gopinath">Suhas Gopinath</keyword> is a name to reckon with in the startup world today, except it's ironical that he started his own company at a time when the Indian startup industry hadn't even taken off. In no time, Gopinath-led <a href="http://www.globalsinc.com/">Globals Inc - an IT services company</a>, was minting profits worth over $1 million annually and had 11 offices worldwide. For a 14-year-old college student to grow a bootstrapped firm from a small home office to a globally recognized multinational company based on the simple formula - a company's outflow cannot be higher than its inflow - was no mean feat. 
 
But astounding success that would inspire Gopinath's entrepreneurial journey he is on today, really came when he was announced as the Youngest Global Leader in the World Economic Forum, Davos in 2008. From here started this Bengaluru lad's journey as the "World's Youngest CEO". There's no better way to learn about his inspiring journey than to <a href="https://www.youtube.com/watch?v=dyfMPsIe2uU">hear him talk about the challenges he faced</a>. 
 It's really no surprise that at the age of 22, a shy-natured Gopinath was sitting among the members of <keyword id="4028297" type="UNKNOWN" weightage="20" keywordseo="ict-advisory-board-of-the-world-bank-group">ICT Advisory Board of the World Bank Group</keyword> headed by the <keyword id="6354424" type="ORGANIZATION" weightage="20" keywordseo="World-Bank">World Bank</keyword> President, discussing ways to increase internet penetration in Africa and use ICT for skill development in India. 
 
As Gopinath enters a new phase in his entrepreneurial journey, Business Insider spoke to him about his second venture, how he plans on revolutionizing the retail space, what are his future plans and much more. ​Below is a lightly edited transcript of the conversation: 
 
Tell us about your new online-to-offline startup Shopsup. 
<a href="http://shopsup.com/">ShopsUp</a> is a location based shopping app which acts as your personal shopping companion. It will recommend what, when and where to shop, and help you find the right products and stores in your neighbourhood. Whenever you want something specific, you can discover exciting boutique stores close to your location as well as stores at popular malls and shopping streets including brands such as Van Heusen, AND, <keyword id="6377547" type="CITY" weightage="20" keywordseo="Adidas">Adidas</keyword>, Pepe Jeans, Raymond, Allen Solly among others. 
 
Who is your target audience? 
India is second largest smartphone market in world in terms of users and increasingly consumers are turning to mobile to discover and research fashion trends and discover exciting consumer items. We are trying to reach young Indian millennial consumers with smartphone and influence their behavior while shopping and discovering local stores. 
 
Why do you feel young Indian shoppers spoilt for choices online would prefer going to the local stores to make a purchase using Shopsup? 
We are focusing on offline brick and mortar stores because statistics show that 98 per cent Indians still shop offline. Consumers still desire a physical interaction with a product and the preference for a physical store as an element of both researching and purchasing, especially for categories such as Fashion, Furniture, Jewelry, etc. The idea is to empower shoppers with tools and technologies so that we can make local stores discoverable, induce shoppers to walk into these stores and influence them to make a purchase. 
 
How exactly are you planning to do that? 
For every walk-in, we incentivise the ShopsUp user. In fact, we are the first app in India to incentivise a user for a behaviour, like window shopping. Let's say you want to buy a linen shirt. If you search for it on ShopsUp App, it will locate the stores around you which have linen shirts. As soon as you walk into one of them, you will get SHOTS irrespective of whether you make a purchase or not. SHOTS are points which you can accumulate to redeem later for movie tickets, cab rides, spa, gift vouchers, food court meals etc. 
 
Would the user be required to install the ShopsUp App before walking into these stores? 
No. There's a low-energy Bluetooth beacon in every store. If your phone's Bluetooth is switched on, you will get a message saying you have received X number of shots. For you to be able to redeem it, you will have to install the app. 
 
...And why would stores partner with you? Apart from increasing their footfall, do they get any more benefits by partnering with ShopsUp? 
Within six months, one of the achievements we have made is to build a natural monopoly by acquiring every brand. 80 per cent of India's brands are with us. We have partnered with 60 brands and 400 boutique stores in Bengaluru so far. So, a ShopsUp user is as spoilt for choices as much as an online shopper and is better rewarded than them. 
 
To answer your question, brands want to be with us because they have a platform to re-target their customers. Also, stores do not have crucial data that can help them in taking the right business decisions. For instance, they do not know how many people walked into their store and how many out of them actually purchased an item. With Shops Up, they will be equipped with data that can help them identify which section is popular in their store, the frequency of their customers, how long does a shopper spend inside the store, what they purchase mostly etc. This data will help make the shopping experience more personalized. For example, ShopsUp will be able to predict that when person X purchases a Polo Shirt, it's very likely he also buys a denim. So, if he purchased a shirt a few days back, he will get a ShopsUp notification with a few denim options later. 
 Also, brands are excited because we offline re-target the customers for them. So, if you visit a Peter England store and then head to <keyword id="6392652" type="COMPANY" weightage="20" keywordseo="arrow">Arrow</keyword> without making a purchase, you will get a push notification reminding you to come back to Peter England and pick up the item you liked. 
 
We believe that the right offers delivered in the right context and right place can drive business for both organized as well as local retail establishments, and we are investing in analytics to offer best of the breed solutions to our partners. 
 
What compelled you to kick-start ShopsUp? Usually, if you want to buy something and you <keyword id="6355629" type="CITY" weightage="20" keywordseo="Google">Google</keyword> it, it will give you e-commerce website options. You cant wait for a product to be delivered when there's an urgency like a friend's wedding or mother's birthday. There are two reasons why one would want to buy anything online - either because it's inexpensive or you do not know where to buy it. 
 
Personally, I am a very impatient person when it comes to shopping. I need things quickly. So, I thought to myself - Is there any way one can have an omni-channel experience where I can do the same thing I do online, except I will have the option of going to the store and picking it up. Also, because fashion and lifestyle is a segment where you need touch and feel, this model made a lot of sense to me. Since we didn't have any such platform in India, this is where the idea of ShopsUp came from. 
 
How are you making money from this model? 
Starting from behaviour to action, we are incentivising our user at every step. But, we don't make any money with that engagement. We charge brands a very nominal percentage for shopping via ShopsUp, but most of our money comes from brands. They buy inventory from us. 
 
What are your plans for the near future? 
We really want to focus on the product and user experience because for the brands there is excellent value proposition. We also plan to build a shopping bot. 
 
So, if you haven't already started using ShopsUp yet, Suhas is offering you a new way to experience shopping. Get on to it, who knows you may get high on shopping like never before!

EXCLUSIVE: In conversation with Suhas Gopinath, World's Youngest CEO, on his new online-to-offline startup 'ShopsUp'

As much as we want to act rationally, our investment decisions are unfortunately <a href="http://www.businessinsider.com/negativity-bias-and-the-economy-2014-2">impacted by our behavioral biases</a>.
In other words, our brains are working against us.
Veteran market strategists Jeff Saut and Richard Russell note that the biases of wealthy investors differ from the biases of not-so-wealthy investors. And this helps the rich get richer and while the poor get poorer.
Specifically, the wealthy have the advantage of not needing more money. Whereas the little guy not only needs it, but he needs it fast.
<a href="http://www.raymondjames.com/inv_strat.htm">Saut, the chief strategist at Raymond James</a>, recently cited this passage from Russell's recent investment newsletter. First, here's Russell on the wealthy (emphasis added):
In the investment world wealthy investors have one major advantage over the little guy, the stock market amateur and the neophyte speculator. The advantage wealthy investors possess is they DON'T NEED THE MARKETS. I can't begin to tell you what a huge difference that makes, both in one's mental attitude and in the actual handling of one's account. The wealthy investor doesn't need the market because he already has all the income he needs. He has money coming in via bonds, T-bills, money market funds, real estate, and stocks. In other words, the wealthy investor never feels pressured to 'make money' in the market.
The wealthy investor tends to be an expert on values. When bonds are cheap and bond yields are irresistibly high, he buys bonds. When stocks are on the bargain table and stock yields are attractive, he buys stocks. When real estate is a great value, he buys real estate. When great art or fine jewelry is on the 'giveaway table,' he buys them. In other words, the wealthy investor puts his money where the values are. And if there are no outstanding values, the wealthy investor waits. He can afford to wait. He has money coming in daily, weekly, monthly. In other words, he doesn't need the market. He knows what he is looking for, and he doesn't mind waiting weeks, months or years (they call it patience).
Here's Russell on the not-so-wealthy:
What about the little guy? This fellow always feels pressured to 'make money', to 'force the market to do something for him.' When this fellow isn't buying stocks at 3% yields, he's off to Vegas or Atlantic City trying to win at craps or he's spending ten bucks a week on lottery tickets or he's 'investing' in some crackpot real estate scheme with an outfit that his bowling buddy told him about. And because the little guy is forcing the market to do something for him, he's a consistent and constant loser. The little guy doesn't understand values so he always overpays. He loves to gamble, so he always has the odds against him. He doesn't understand compounding and he doesn't understand money. He's the typical American and he's perpetually in debt.
The little guy is in hock and he's always sweating, sweating to make payments on his house, his refrigerator, his car or his lawnmower. He's impatient, and he constantly feels pressured. He tells himself he has to make money fast. And he dreams of 'big bucks'. In the end the little guy wastes his money on the market, he loses his money on gambling, and he dribbles it away on senseless schemes. In brief, this 'money-nerd' spends his life running up the down-escalator. Now here's the ironic part of it. If, from the beginning, the little guy had adopted a strict policy of never spending more than his income, if he had taken that extra income and compounded it in safe, income-producing securities - in due time he'd have money coming in daily, weekly, and monthly - just like the rich guy. Then in due time he'd start acting and thinking like the rich guy. In short, the little guy would become a financial winner instead of a loser.
Russell's characterization of the "little guy" may seem unfair. Not all of us are drowning in debt. But dreams of bigger bucks fast seems pretty close to universal.
Saut extends Russell's discussion by beautifully articulating the madness of markets and investing:
In the world we live in, few look at risk. Most only look at reward. The few who do look at risk (the educated, the street savvy) make their money at the expense of the great unwashed majority who swallow the noise nonsense about getting rich quick. Investing is a get rich slowly process. You have to put your money at risk in the face of uncertainty. Emotions run rampant before the uncertainty of floating, fluctuating, often violent and volatile markets. Constantly discounting prices are fickle and full of surprises. Disorder is usually the norm.
Some stuff to remember as you make your next investment decision.

Jeff Saut And Richard Russell Nail The Huge Advantage Wealthy Investors Have Over The Little Guy

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image">REUTERS/Lucas JacksonA trader works on the floor of the New York Stock Exchange shortly before the end of the day's trading in New York, July 31, 2013.</div></div></div>NEW YORK (Reuters) - It's a good time to be a stock picker.
Some 57 percent of U.S. funds run by active managers are beating their benchmark indexes this year, according to fund-tracker Morningstar. That is the best overall performance for the industry since 2009 and well above the 37 percent of funds that typically top the indexes.
Stock pickers are doing well in part because after more than four years of marching higher en masse, <keyword id="6354298" type="ORGANIZATION" weightage="60" keywordseo="stocks">stocks</keyword> have started to separate themselves into leaders and laggards. The lines of demarcation became more pronounced during the past few weeks as U.S. companies reported their recent quarterly results.
Nearly 69 percent of companies are beating analyst estimates in the third-quarter - that's typical, but this season the misses are not concentrated in any particular sectors. Each sector has had its share of high-profile shortfalls.
Look no further than technology: Thomson Reuters data shows that 84 percent of the 55 tech companies reporting so far surpassed earnings forecasts. Yet investors sent IBM <IBM.N> to a 2-year low on weak sales figures, and several chipmakers took a hit after issuing disappointing forecasts.</IBM.N>
Implied correlations - a measure of how closely the performance of individual stocks mirrors that of the index itself - have fallen to their lowest since October 2007 after peaking in 2011, according to a research note from Cantor Fitzgerald. That means that instead of the returns of most stocks clumping close to the index returns, there is a much broader spread on how individual shares are performing.
That's a sign that investors are picking winners and losers. It also suggests the bull market - which has carried the S&amp;P nearly 170 percent higher since March 2009 - is starting to show its age. The S&amp;P 500 has set 33 new highs this year after failing to reach record levels since 2007. Now there are fewer beaten-down stocks that offer the chance for a quick pop higher.
Instead of searching for screaming bargains, fund managers are turning their focus to well-run companies that have sustainable advantages and may hold their value during a downturn, however unlikely that may seem at the moment.
"Ultimately as any recovery ages you start to see a selection process where better executing companies are afforded more attention. The general 'trade the group' strategy does not quite hold as well and you have to be more careful," said Michael Sansoterra, the manager of the $289 million Ridgeworth Large Cap Growth fund <STCIX.O>.</STCIX.O>
<h3>THE EARNINGS SEASON REVEAL</h3>
There are several reasons for the growing disparity in corporate performance. For the past four years, companies benefited from the rising tide, and some were able to use stock buybacks and dividend hikes to fuel share prices even when operating performances was not up to snuff. The Federal Reserve's economic stimulus program, which has put a lid on interest rates and allowed companies to refinance their debt cheaply, also helped lower-quality companies shine.
Now, as third-quarter earnings reports reveal which companies have stronger or weaker sales prospects and profit margins, choosy investment managers are rewarding stronger companies and walking away from those that display weakness.
Shares of United Continental Holdings <UAL.N>, for instance, fell as much as 4 percent on October 24 after the airline operator missed analyst estimates because of high costs and unused seats. Analysts from JP Morgan,Raymond James and Evercore Partners cut their outlooks for the company, citing its poor results, while revenues are growing at other airlines.</UAL.N>
Shares of Delta Air Lines <DAL.N> and Southwest Airlines <LUV.N> have continued to rally as a result of a pickup in business travel and thinner competition. For the year, Delta is up 123 percent, compared with United's 45 percent rise.</LUV.N></DAL.N>
Among clothing companies, VF Corp <VFC.N> rose 5 percent on October 21 to an all-time high after it beat estimates on strong demand for its Timberland, Vans and the North Face brands.</VFC.N>
VF Corp is up 42 percent for the year, while competitors like Gap Inc., Ralph Lauren and Abercrombie &amp; Fitch Co have lagged the broad market after missing sales targets and relying on heavier discounts during the back-to-school shopping period. Gap, for instance, is up 19 percent for the year, while Abercrombie is down 22 percent.
<h3>'HARDER' MARKET</h3>
Managers complain that finding hidden gems is increasingly challenging as the most promising companies are already pricey and there are no obvious bargains.
"It gets harder now that the market has gone up and you have to avoid overpaying for growth," said Craig Watson, a portfolio specialist who works on the $19.8 billion T. Rowe Price Blue Chip Growth fund <TRBCX.O> and the firm's other large-cap funds. The fund is up 32.5 percent for the year, or about 7 percentage points more than the S&amp;P 500.</TRBCX.O>
His Blue Chip Growth fund added to its position in Amazon.com despite its 43 percent gain for the year because of its strong management and earnings potential, Watson said.
"If you are taking a longer-term view like we are, then something that may look expensive today won't look like it is in two or three years because the company is so well-managed," Watson said.
John Fox co-manages the $902 million FAM Value Fund <FAMVX.O>, whose 28 percent gain for the year puts him 2 percentage points ahead of the S&amp;P 500. He said the rush to equities by investors looking for yield has stretched valuations. The fund, which has 42 stocks, has added only four new positions this year, compared with the 12 Fox bought "in only a few weeks" during the fall of 2011, he said.</FAMVX.O>
Fox's most recent purchase: Forest City Enterprises Inc <FCEa.N>, a commercial real estate developer that is up 25 percent for the year. Fox likes its plan to sell some of its assets and focus on the higher-end New York and Washington, D.C., markets, and estimates that the stock could jump 15 percent from its current price of about $20.26.</FCEa.N>
Bill Smead, who has steered his $530 million Smead Value Fund to a 30 percent gain for the year, is optimistic that the gains in the U.S. housing market will keep pushing stocks higher. He has been adding to his position in Walt Disney Co <DIS.N>, for instance, because he expects that more families will opt for vacations at its amusement parks as their home values rise. Shares of Disney are up 37.8 percent for the year.</DIS.N>
Still, he longs for the volatility - and subsequent correlations - of the market of the past few years.
"You don't like to see people going on TV talking about how great stocks are," he said. "That stuff bothers you when you're picking stocks. You want to be in an environment where no one agrees with you."
(Editing by Linda Stern and Frank McGurty)

Finally, It Looks Like Picking Stocks Is A Winning Strategy

<div class="KonaFilter image-container float_right"><div class="image">REUTERS/Sarah ConardSt. Louis attorney David Wasinger is seen in his Brentwood, Missouri office February 10, 2014.</div></div>WASHINGTON (Reuters) - Before attorney David Wasinger decided to take on two of the biggest global banks in federal court in New York, he had visited the city just twice: once when he was 6, and the second time on a tour bus with his children.
As the sole partner at a five-attorney firm in St. Louis, Missouri, Wasinger was mostly focused on local business litigation and had never represented a whistleblower.
But in January 2012 an old business acquaintance was ready to go public with accusations of widespread mortgage fraud at Bank of America's Countrywide unit, and he turned to Wasinger.
That touched off a series of events that put Wasinger at the center of two of the biggest legal cases to emerge from the 2007-2009 financial crisis, against Bank of America and JPMorgan Chase &amp; Co, respectively.
In January, the U.S. Attorney's office in Manhattan said it is seeking up to $2.1 billion in penalties from Bank of America after a jury in October found the firm liable for fraud over defective mortgages sold by Countrywide. Wasinger's client, former Countrywide Executive Vice President Edward O'Donnell, was the star witness for the prosecution.
And earlier this month, JPMorgan Chase agreed to pay $614 million to settle claims that it defrauded the U.S. government by submitting sub par home loans for federal insurance. The case relied in part on evidence provided by another Wasinger client.
"We've been very, very fortunate," Wasinger, 50, told Reuters in an interview. "I am just a country lawyer from Missouri trying to hold Wall Street accountable."
It has not been determined how much money Wasinger's firm or his clients will receive. Typically, a whistleblower who exposes fraud against the government can receive 15 percent to 25 percent of the settlement, though a court can cut the award depending on how much the person contributed to the case and other factors.
Experts say Wasinger's payout from the JPMorgan case could reach into the millions of dollars, an amount that would be a windfall for his relatively modest firm. His potential gains from the Bank of America case would likely be much smaller, as that case was tried under a law that limits whistleblower recoveries. Wasinger declined to comment on possible earnings.
Representing whistleblowers is a lucrative business for lawyers and is hyper competitive, since few corporate insiders who come forward actually have the information that leads to big government lawsuits. What makes Wasinger's situation unusual is that he stumbled into the field.
<h3>A CALL FROM A FRIEND</h3>
Wasinger grew up two hours north of St. Louis in Hannibal, Missouri, an agricultural community of 18,000 people that is famous for being Mark Twain's hometown. He earned his law degree from Vanderbilt University in Tennessee in 1988, and worked for a short time at a large regional firm in St. Louis.
In 1991, Wasinger joined a small law firm with a colleague that has morphed into the Wasinger Law Group. His wife, Colleen, is also an attorney at the firm, which handles real estate litigation and partnership disputes, among other local business matters.
It is a small but busy practice, according to Wasinger, who said he typically worked 40 to 50 hours a week. The Bank of America case took him to a whole new world of high-pressure New York trials and 90- to 100-hour work weeks.
Prior to that case, Wasinger had never before worked on litigation involving the False Claims Act, the law that allows whistleblowers to collect rewards if they disclose fraud against the government. But Wasinger had known his client for years, having represented another company O'Donnell worked at in an unfair competition case in the 1990s.
In February 2012, Wasinger filed a sealed case against Bank of America on behalf of O'Donnell, who accused Countrywide of selling thousands of shoddy mortgage loans to the government-controlled Fannie Mae and Freddie Mac.
Wasinger said he decided to file the suit in New York as the local U.S. Attorney's office did not have much experience with financial fraud cases. He drafted the complaint and traveled to the Big Apple, his third visit.
"He is a very dogged and determined lawyer," said Heidi Wendel, who dealt with Wasinger when she was a lawyer in the civil frauds unit at the Manhattan U.S. Attorney's office. She is now in private practices at the law firm Jones Day.
"He drafted a solid complaint that could get the government's foot in the door," Wendel said, referring to the Countrywide lawsuit.
Wasinger also filed a similar complaint with the Justice Department under another law, the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA). Then he waited.
In October 2012, the Justice Department joined O'Donnell's lawsuit. Bank of America decided to fight it, and the trial took four weeks with O'Donnell as the primary witness.
It was a much larger trial than any cases Wasinger had been involved with, and one he described as intense and stressful. The government's Countrywide trial team would often stay in the office until midnight or 1 a.m. One Justice Department lawyer slept on an air mattress in the office after his home was damaged by Hurricane Sandy.
Wasinger said he was often daunted by the army of Bank of America lawyers that would pull up to court each morning. "It was like a presidential motorcade," he said. "Meanwhile, DOJ doesn't even have a coffee pot in their office."
The government and Bank of America are waiting for a judge to determine the bank's penalty. A spokesman for Bank of America, headquartered in Charlotte, declined to comment. A spokeswoman for the U.S. Attorney's office also declined to comment.
<h3>A CALL FROM A STRANGER</h3>
After the Bank of America case became public in October 2012, Wasinger said he received dozens of phone calls from people claiming to be whistleblowers.
Most of their tales of corporate fraud were not credible, he said, and turned them away.
One of the callers was Keith Edwards, a former supervisor in JPMorgan's government insuring unit in Louisiana. Edwards told Wasinger he had been pushed aside when he tried to improve the quality control of loans submitted for insurance to the Federal Housing Administration or the Department of Veterans Affairs.
After hearing so many similar claims, Wasinger was skeptical. "You've got a lot of good lawyers in Louisiana," he told Edwards. If Edwards was serious, Wasinger added, they would have to meet.
Edwards drove through the night to St. Louis from Monroe, Louisiana, a nine-hour trip. He was impressed with Wasinger after their initial conversation, Edwards told Reuters via email.
In January 2013, Wasinger filed his second False Claims Act case, this time against the largest U.S. bank, on its home turf.
The U.S. Attorney's office was already deep into an investigation into JPMorgan's mortgage-lending practices. Edwards provided the government with new information, including about VA loans. Instead of litigating the case, as Bank of America had, JPMorgan decided to settle.
A JPMorgan spokeswoman declined to comment beyond its previous statement that the settlement "represents another significant step in the Firm's efforts to put historical mortgage-related issues behind it."
<h3>NO PAYMENT YET</h3>
Wasinger has yet to be paid for the two cases that he spent much of the past couple of years working on.
The government and Wasinger are currently negotiating Edwards' share of the JPMorgan deal. Under the False Claims Act, he can theoretically earn up to $150 million, but is likely to get less than that because the government had already conducted some of the investigation into JPMorgan prior to his complaint.
In the Countrywide case, although O'Donnell was a key witness, his payment is capped at $1.6 million under FIRREA because the False Claims Act portion of the suit was dismissed prior to trial. O'Donnell may be able to collect more money if he appeals that ruling.
Wasinger said he will get a cut of what his clients are awarded, but declined to give details.
The percentage that a lawyer for a whistleblower gets varies widely, but a general rule of thumb is 33 percent to 40 percent, according to Stephen Kohn, executive director of the National Whistleblower Center, a non-profit group that advocates for whistleblowers.
There have been only about 25 large cases - more than $200 million - in three decades' worth of False Claims Act prosecutions, he said.
In one of the largest payouts ever, a former quality manager at GlaxoSmithKline Plc won $96 million in October 2010 for exposing manufacturing defects at a plant in Puerto Rico. The drug company paid $750 million to settle the charges.
As Wasinger awaits payment, he and his firm have continued to work on their usual stable of local business litigation. Wasinger said he has no plans to seek out whistleblowers as clients but could represent another if the case was right.
The attorney said he wants some time to decompress. He has had to travel to New York frequently in the past two years, but spent most of his time in conference rooms and the courtroom. With each visit to the U.S. Attorney's office in downtown Manhattan, he has enjoyed watching construction progress on One World Trade Center and the 9/11 Memorial.
Once he gets paid, Wasinger said he plans to spend some of the money on his sons: Alex, who just turned 12, and Andrew, who is 10.
"I'm taking them to New York City," Wasinger said.
(Reporting by Aruna Viswanatha in Washington; Additional reporting by Nate Raymond in New York; Editing byKarey Van Hall, Tiffany Wu and Doug Royalty)

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