Here it is! The new Rayno Report Model portfolio for 2013. We have selected 13 stocks for 2013, in order to fight superstitious numbers with even more superstitious numbers (cheeky, eh?).

What exactly is in this portfolio? It is a collection of attractive stocks based on valuation and growth numbers. Our methodology looks for stocks that have attractive sales & profit growth relative to valuation, using forward P/E, return on equity, and growth calculations. The model likes a low P/E relative to its growth rate or Return on Equity. If the P/E is lower than its growth rate (PEG Is less than 1), excellent. If the P/E is lower than both the growth rate and the Return on Equity, fantastic! Lots of studies shows that stocks selling at a discount to growth and ROE outperform over time.

Name	Symbol	Price (1/4/2013)	Mkt Cap	EPS	P/E Next Yr	PEG Ratio	Yield
First Majestic Silver Corp.	AG	20.48	2.38B	0.79	10.91	1.22	0
IAC/InterActiveCorp	IACI	46.94	4.15B	1.81	12.4	0.59	2
Intuit Inc.	INTU	62.22	18.42B	2.76	16.55	1.27	1.1
iShares MSCI Emerging Markets Index	EEM	44.99		18.01			1.33
iShares Nasdaq Biotechnology	IBB	142.62		-2.54			0.59
Lindsay Corporation	LNN	81.26	1.03B	3.38	18.05	1.65	0.6
Northern Oil and Gas, Inc.	NOG	17.19	1.08B	0.81	13.04	0.48	0
Omnicare Inc.	OCR	37.5	4.15B	1.47	10.44	0.96	1.5
priceline.com Incorporated	PCLN	648.41	32.33B	26.45	17.32	1.03	0
Riverbed Technology, Inc.	RVBD	21.14	3.25B	0.42	17.31	0.99	0
Royal Gold, Inc.	RGLD	79.31	5.16B	1.62	28.75	4.29	1
SeaDrill Limited	SDRL	37.8	17.73B	2.12	11.86	0.6	8.8
Titan Machinery, Inc.	TITN	25.75	535.93M	2.12	9.76	0.59	0

The bulk of our stocks are you would call "low-PEG" stocks that meet this formula. This could also be known as a "GARP" -- or Growth at a Reasonable Price strategy, though some of these stocks are priced low enought in P/E terms to be considered value investing.

To be clear, not all of the stocks this year fall into this strict valuation criteria. There are two indices -- the iShares Nasdaq Biotechnology index and the iShares MSCI Emerging Markets index -- which is a bet that those sectors will outperform. And I've included two precious metals companies (First Majestic Silver -- AG; and Royal Gold -- RGLD) because I believe that precious metals will reassert their outperformance in 2013. Precious metals companies are typically valued on reserve values, not P/E ratios. I think both these companies are attractively priced and silver seems especially poised for upside in 2013. Precious metals stocks have been unfairly punished by the market in 2013 because of the perceptions that their costs are too high, however I think rising metals prices and profitability in 2013 will show these fears to be overdone.

Overall, in running my screens and analysis for 2013, I was surprised at the number of quality high-growth companies available at reasonable valuations. IACI (Nasdaq: IACI), Priceline.com (Nasdaq: PCLN), and Omnicare (NYSE: OCR) all fall into that category. I like Riverbed (Nasdaq: RVBD) and have been looking forward to the day where it traded at a PEG of 1 or less, and that day is here. On this basis, the market does not appear overpriced. Many high-quality technology names appear quite cheap.

The energy sector is also appealing to me. Drillers have sold off, but Seadrill (Nasdaq: SDRL) has attractive profitability and growth and pays an 8% dividend. Northern Oil and Gas (NOG) is a small, fast-growing oil-shale in the Bakken region -- one of the strongest economic growth stories in the world. Go where things are happening!

In the interest of getting the portfolio out, here it is. I will profile these companies in the coming months.

(Disclosure: At the time of writing, the author and his direct family members owned many of the shares included in this model portfolio. He plans to own all of them by the end of Q1.)

I've been poking around Telecom New Zealand (NZT) for quite a while. It first showed up in a dividend stock screen when the dividend was paying about 8%. Forbes' Ken Fisher, who is a pretty good stock picker, recommended it. Now the stock is lower and the dividend is at about ten percent.

What happened?  They recently reduced guidance. Then the CFO left. But as the stock goes down, the dividend goes up. This company has generous free cash flow -- somewhere in excess of $150M in 2010, likely. It's got $1.5 billion in debt, but it also has EBIDTA approaching $1B, so it is adequately covering the debt payments and the dividend.

The forward P/E is about 11. Basically, I feel lucky that I waited to buy this stock, because it looked like it was cheap, and then it got even cheaper. But now that it's fallen to a level of about $6 and is paying 10% dividend, which is almost irresistable to me.  I think it's worth a shot. After all, we are talking about a telecom services stock in one of the healthiest regiona economies in the world.

With this week's bounce off of $6, the stock could be forming a long-range double-bottom. A buy here with a stop at $5.50 seems like the right thing to do.

(Disclosure: Long NZT)

Research firm Broadpoint AmTech, which has been on top of the solid rally in specialty chipmakers, yesterday raised its earnings estimates and price target for Omnivision (OVTI), a chipmaker that specializes in imaging silicon for applications such as cameras in mobile phones. OVTI, a favorite of the momentum investing crowd, had huge moves from 2002-2006, but then stumbled badly in 2008. Broadpoint AmTech analyst Doug Freedman seems believes it will rally on faster-than-expected earnings growth tied to smartphone growth and other markets driving the adoption of Omnivision's imaging technology. The favorite speculation among investors now is whether it will gain entry into Apple's i-Business. It could also ride the wave of growth of cameras and imaging technology in smartphones in general.

Google's announcement that its moving its servers to Hong Kong, along with China's harshly worded response, is indicative of a brewing trade war between open, Western countries and China. With Baidu (BIDU) stock pushing toward $600, it's pretty clear who the main beneficiary is here: the leading Chinese portal. Meanwhile, Google is losing influential business partners in China. Billionaire Li Ka-shing's Tom online shopping service pulled Google search from its Web site, and many others are following suit, according to BusinessWeek. The media is describing this as a technology soap opera with implications for other Internet companies in China, but I'd look at it in even broader context: This is a watershed moment in relations with China for global business. With Chinese trade being one of the main drivers of International commerce, this means trouble. It could be the beginnings of a crippling trade war. The Google-China row is just the latest in a series of warning signs that a trade war is brewing. U.S. Congress has been stepping up its complaints about the Chinese currency peg. It's clear to many business executives, including those in the  automobile industry, are worried that China is accelerating its protection of national markets. And now the Google moment, which is de facto protectism on behalf of China, which refuses to back down on censorship. It leads me to ask: How can this have a happy ending? Western companies are trying to negotiate with Chinese authorities on Western terms, where the markets are open and the human rights more universal. But the rules are lopsided, as China is still a totalitarian state using a command-and-control economy. Do we really think this can end well for Western business. Beijing will continue to do what's good for Beijing, and they can, because their the ones with a billion people and the fastest growing markets in the world. Google's move is probably just the first in a series of trade disputes that are likely to heat up.

Sometimes America can be myopic, self-centered, and oblivious. Today is one of those days when many of the news outlets are focusing on Twitter, the Toyota recalls, and Taylor Swift. With more chaos brewing in the Middle East, it's a good time to remember that there are some major wars underway. I only say this because these are disturbing times, and we have to be reminded of the fact of the dangers of global political conflicts. Keep it in mind. Let me catch you up to date on what's going on "out there," as well as other stuff:

• Violence in Israel is flaring up again, following the reopening of a synagogue in Jerusalem's Old City (The Guardian).
• The Obama adminstration and Benjamin Netanyahu are headed for a showdown (NPR)
• George Mitchell's Israel trip is on hold (Politico)
• What does it mean for Iran? Well, the eminent bombing rumors that have circulated may be put on hold. (Huffington Post)
• Several folks think Biden's trip to Israel was aimed at discussing the bombing of Iran. Instead, it devolved into a critique of Israel's settlement policies. (Politico)
• The US and EU are calling for a "clear response" to Iran. Some believe that bombing isn't yet off the table. (AFP)
• Iran is standing its ground (Tehran Times)
• Zero Hedge technical take predicts a  market crash in April (Zero Hedge)
• U.S. Housing starts declined 5.9% in February (Bloomberg). Do housing start numbers in the dead of winter really matter?
• The Fed wants to "avoid lower inflation" (Bloomberg). Isn't that another euphemism for printing money?
• U.S. lawmakers are going to press China for action on currency (Reuters). Yippee! Trade War with China! Just what we all need!
• Sony has signed a $250M deal with the Michael Jackson estate on forthcoming albums involving both previously unreleased material and famiar ones. (Wall Street Journal). Just beat it!
• Core Strength Training for Men. (Wall Street Journal). I just think it's funny that you can find this stuff on a Wall Street Journal page.
• Is China-Google a lose-lose scenario? (Associated Press)
• Google's biggest blunder: Not letting Microsoft buy Yahoo (Slate). I can go with it.
• Vitamin D linked to lower heart disease risk (L.A. Times)

Well, if you didn't think economic and policy actions in China were driving the markets, look again. Nearly all the market activity this morning revolves around China, whether it be stock markets, commodities, foreign currency, Google, Baidu, or whatever. Take a look:

• Markets are off on fears that Chinese officials will tighten policy further to cool off inflation, says da Bloomberg.
• Baidu shares are flying -- up more than 6% -- on reports that Google is close to shuttering its China site (Wall Street Journal).
• Word is that China is talking tough on censorship (Washington Post). Did you expect anything less?
• Chinese Premier Wen Jiabao is pushing back on calls to let China's currency rise (Reuters). Hmm, yet he's worried about inflation? Unpeg your currency, dude!
• Chinese energy company Cnooc is gobbling up oil resources in South America (New York Times). That's a hungry monster, that China!

And in other, non-China news:

• The Apple blogs are reporting that orders for the iPad are slowing down (Apple Insider).
• Flurry reports that the iPad has boosted app developers, who are excited about the platform (Fortune).
• Here's a daily news wrap from the SXSW show (Billboard). Billboard? Yes, billboard. You know, SXSW was supposed to be a music show.
• ABBA and Jimmy Cliff have been inducted into the Rock and Roll Hall of Fame (CNN). Now that is one interesting combo. I would like to see a concert with them playing together.
• Colorado is ground-zero for Amazon's fight to stave off state taxes (MSNBC). Note to Amazon: Have you noticed that the states are, like, broke?
• FBI details most difficult Internet scams (NetworkWorld).

Ebix Inc, the company we discussed here on Friday, is out with earnings and they don't look too shabby. The company hit $0.92 in EPS for Q4 2009 and $3.10 for the year. Net income was $12.1, up 53% year-over-year The stock is bid in the pre-market at $18, up 6% from a $16.95 close of Friday. It''s a small-cap stock, not a lot of institutional interest in the pre-market, so it's hard to tell what will happen when the market opens. But it looks to me like the stock is going to open up big. These numbers represent new record revenues for the company. Keep in mind here the thesis was that this is a fast-growing, profitable company whose shares were undervalued. I have no idea what it was doing with a P/E of 12, but it's going higher.

In investing and analysis, it's best to avoid becoming enamored or "married" to one idea or stock. But I find that I'm hooked on a company called Ebix. I keep trying to find ways to punch holes in the story behind this company, and it's really hard. I am scratching my head about why the shares are so cheap. This just seems like a fast-growing company whose stock is priced cheaply. With a quarterly earnings call coming up on March 8 and the stock having pulled back 25% or so from its recent highs, it's a good time to take a look at Ebix shares. Ebix was formerly known as Delphi, but changed its name in 2003. It's focused on selling software and e-commerce software for the insurance industry. Many of its software products are customized, allowing insurance carriers to design systems for policy and claims administration. Since CEO Robin Raina has taken over as the CEO of the company in 1999, he's done a great job at growing the company. For example, the five-year revenue growth rate  is 39% and profits have grown 79% annualized. To put things in perspective, the company was doing just $30 million in business in 2006, but looks on track to do about $90 million in 2010. It has grown in each of the last five years, even through the recession.

There are increasing signs that China's heading for big economic changes, and that will likely fuel an increase to the market chaos. The most recent speculation involves a potential upward revaluation of the Chinese Yuan against foreign currencies. Goldman Sachs Chief Economist Jim O'Neill (no lightweight) -- says that something is brewing in China as they may be preparing the revalue the Yuan higher by as much as 5%. This would represent another leg of Chinese monetary tightening. China has been tightening its monetary policy by requiring banks to increase reserves. It has a history of raising reserves repeatedly when it goes into a tightening mode. A Yuan revaluation would represent a big move to cool off growth and stave off inflation, which has been increasing in China. Marketwatch reports that real-estate prices on the Chinese vacation island of Hainan have increased 30% in one week.  That's almost the definition of hyperinflation.

This morning I posted an item on Scott Brown and how it was interesting that the markets are down. Shame on me. Not only am I making the #1 mistake that financial journalists make -- a spurious correlation -- but I didn't even analyze the more obvious reasons. You see, China tightened credit again. And in other data, housing starts were down. There are a whole host of reasons why the market could be down. When China tightened credit again overnight, that may have helped spur a rally in the U.S. Dollar, which started in the wee hours of the morning U.S. time. Because China, credit, and currencies have been ruling the market (not politics), it's my guess that this has been a bigger factor in today's market selloff. Take a look, for example, at what the BBC has to say about it. The selloff started in Europe, centered around the China news. Financial "journalists" worldwide will continue to scurry to explain how the markets can be down when Massachusetts elected a Republican Senator. For example, the Business Insider is busy scratching its head and bashing Cramer about it.  This is a U.S.-centric view of things. The bottom line is that scientifically, it's nearly impossible to determine "why" the market is down. It could be random noise. Or it could be some overleveragd hedge fund liquidating. Because nobody knows for sure, let me now annex possible theories I introduced to include more options: 1) China cut credit again. In a liquidity-driven market, this is bad. 2) Republicans gained a senate seat. That means less healthcare and less stimulus. The market rally has been coincident with government stimulus, therefore the market is selling off on the idea there will be less liquidity in 2010. 3) It's raining in California. 4) Scott Brown has a nice haircut, and and once posed nude. The idea of a former male model as U.S. Senator has investors scared. 5) The latest numbers show the drop in the bee popuation reaching a crisis. (Telegraph) 6) Conan is toast. (Popeater.com) Go ahead journos. Pick a random data point and write a story about your theory. The market is down because (choose one).