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There are no "falling off the cliff" worries when it comes to the Dirt Cheap Value Portfolio, due to its tall guard rail and spacious ledge. The notoriously defensive companies are still priced near their March 2009 panic lows. In the last two weeks, these five stocks have outperformed the rest of the market, and as the Dow Jones 30 Index proceeded to fall 1.5% (being totally engrossed in the drama of the fiscal cliff crisis), the "DCVP" lost only 1%.

The DCVP's high relative strength is even more impressive when you consider that Luby's (NYSE:LUB), Pep Boys (NYSE:PBY) and Fuel Systems Solutions (NASDAQ:FSYS) have an average beta (the measure of stock's volatility in relation to the rest of the market) of 1.76. This computation means these stocks are expected to perform at a level 76% more volatile than the overall market. This suggests that if the Dow lost 1.5% in the last two weeks, these equities should of lost 2.64% of value. The fact that they did just the opposite is particularly noteworthy.

The five components updated:

Diamond Foods (NASDAQ:DMND): The company recently reported 1st quarter non GAAP earnings of 24 cents, which exceeded expectations by a penny, however Wall Street continued to crush the stock due to light revenues. The realization that the Motley Fool wrote a bearish piece on it makes me believe it is time to buy. The Motley Fool's opinion is a classic contrarian indicator. They are usually late to the party on long situations and too bearish on turnaround plays. In addition, analyst estimates have gotten way too pessimistic, as the snack food maker is now expected to earn just 8 cents on sales of $241 million in its second quarter.

JetBlue Airways (NASDAQ:JBLU): Dahlman Rose just upgraded from a sell to hold, while two SA contributors (Kappital and Anthony Parsons) each recently presented bullish takes. In the last 12 months, this stock has appreciated a mere 10%, while its earnings improved a whopping 45% from 29 cents to 42 cents. Obviously the market has not caught up with the carrier's fundamental improvements, but should recognize the "errors of its ways" soon.

Luby's (LUB): Its CEO just acquired another 50,000 shares in this "under the radar" stock, and now owns a hefty 16% stake. It is safe to say CEO Chris Pappas is "putting his money where his mouth is." The company just reported results that were in line with estimates and forecasted fiscal 2013 earnings of 27 to 30 cents (predicated on a .5% to 1.5% increase in same store sales). Sales are forecasted to be $370 million to $375 million, with $39 million of revenues slated to be contributed from their new Cheeseburger in Paradise acquisition.

The company's 1st quarter conference call was fairly upbeat, however there was only one analyst (James Fronda of Sidotti & Co.) who provided questions. This lack of interest by the investment community must urgently be addressed. One solution to this problem would be presenting at an investment conference, such as the upcoming ICR XChange Conference.

Fuel Systems Solutions (FSYS): The good news about FSYS is that its earnings expectations are horrendous, meaning they should be easy to surpass. Case in point: the company is expected to report its fourth quarter earnings in nine weeks. Analysts expect the company to lose 1 cent on sales of $91 million, compared to earnings of 7 cents on sales of $111 million in its 2012 fourth quarter. Look for the alternative fuel component maker to beat that forecast significantly - tallying revenues of $97 million and earnings of 5 cents. This type of "beat" could easily translate into an immediate 20% share markup.

Pep Boys (PBY): The fact that the company's CEO bought shares, along with an outside director (Michael O'Dell purchased 5262 shares, while Jane Scaccetti bought 3,000) is proof positive that management believes in the company. Couple that with a $50 million stock buy back pledge and you have the makings of a profitable investment. Fourth quarter earnings estimates of 5 cents, on sales of $507 million, look like a cinch to surpass. The wild card factor: the auto parts retailer is still a takeover play and both AutoZone (NYSE:AZO) and O'Reilly Automotive (NASDAQ:ORLY) look like potential suitors as a way to enter the tire business and combat their own slowing, organic growth rates.

Conclusion: The fiscal cliff drama should be resolved quickly, and this positive development will provide a quick 2 to 5% gain in the markets. The members of the DCVP should rally at twice that rate, due to their elevated betas and current high relative strength. It is time to venture out on to the ledge, without fear.

Source: The Dirt Cheap Value Portfolio: Fiscal Cliff Protection At Its Best