The S&P 500 is down 12% this year. But some stocks are doing spectacularly well.

My newsletter, which has been picking three stocks a month for the last five and a half years, has found several of them. This year, it's up 29% so far. That increase is the rise in the average stock mentioned in the newsletter since its initial mention through the end of June. And it uses a 2% stop loss rule which automatically sells any stock that has declined by 2% and charges that decline against the returns.

Here are the three biggest winners:

• Walter Industry (NYSE: WLT) +156%
• Southwestern Energy (NYSE: SWN) +44%
• Chart Industries (NYSE: GTLS) +43%

With oil prices on the rise, these three are likely to benefit. But at some point, their valuations will exceed their earnings growth. So keep a close eye on them.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.

I don't normally toot my own horn, but stock picks I made earlier this year through my investment newsletter have done far better than the S&P which has fallen 6% since the beginning of the year.

Each month my newsletter mentions three stocks. I average the percentage changes in the stocks I mention at the end of each month. I also have a stop loss rule in which stocks that decline by 2% are sold from the theoretical portfolio and the -2% return is included in the average for the month.

The top three performing stocks through April are:

• Walter Industries (NYSE: WLT) rose 66% from $41.71 to $69.36
• Southwestern Energy (NYSE: SWN) rose 30% from $32.62 to $42.31
• Ultra Petroleum (NYSE: UPL) rose 21% from $68.80 to $83.07

The Associated Press reports that Asian markets are down between 3% and 4% today and European markets have opened down about 1%. Already this year, the S&P 500 is down 10%. Yet I am convinced investors can make money in this down market.

I have not been that surprised about how bad the economic and stock market news has been this year. I believed that it was coming – in fact I was way too early about it. I remember back in 2005 being quoted about how a housing bubble was building and that it would eventually pop.

I did not know back then about subprime mortgages or how they had been packaged into securities with odd names like Collateralized Debt Obligations (CDOs). It appears to me that this housing bubble burst is different from the one in the early 1990s thanks to those CDOs.