Archive for February, 2010

Coke Wants To Own Bottlers Again – Is Past Strategy A Sign of Times To Come?

Friday, February 26th, 2010
Coke Wants To Own Bottlers Again – Is Past Strategy A Sign of Times To Come?

On Thursday, Coca-Cola (KO) announced the acquisition of all North American bottling operations from Coca-Cola Enterprises (CCE). (Click here for Coca-Cola press release) This is an example of “vertical integration,” a growing activity among leading companies. As I wrote in December (“Message from Companies: Growth with Inflation Is Coming”), I believe vertical integration is... »

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Want To Buy A Sector Fund? Ignore the Label; Examine the Contents

Thursday, February 25th, 2010
Want To Buy A Sector Fund? Ignore the Label; Examine the Contents

After reading yesterday’s write-up (Homebuilder Stock Articles Raise Questions – And Exclamations), you understood why a 9% year-to-date return for homebuilder stocks was more appropriate than 21%. Still, 9% in less than two months is pretty good. So, you checked the performance of your homebuilder fund and… WHOA! What happened? The performance is so... »

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Homebuilder Stock Articles Raise Questions – And Exclamations

Wednesday, February 24th, 2010
Homebuilder Stock Articles Raise Questions – And Exclamations

On Monday, Bloomberg reported, “Homebuilding Stocks Seen Rising Too Far, Too Fast.”  The reporter included a graph that shows homebuilders far outperforming the stock market year-to-date. Other publications, including The Wall Street Journal, picked up the theme, helping the stocks to sell off more sharply than the market on Tuesday. The problem is that... »

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Pent-up Demand – For CDs?

Tuesday, February 23rd, 2010
Pent-up Demand – For CDs?

Certificates of deposit (CDs) have been uninteresting for some time now. With short-term interest rates so low, there has been little incentive for savers and investors to lock up their money. As the Federal Reserve raises rates, that picture could change, with demand once again picking up. »

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Fed’s Discount Rate Announces, “Investors, Time To Get Aboard!”

Friday, February 19th, 2010
Fed’s Discount Rate Announces, “Investors, Time To Get Aboard!”

EARLY RELEASE OF MONDAY, FEBRUARY 22, ARTICLE On Thursday (February 18), I wrote about three trends approaching (Indicators Have Shifted – New Investment Directions in the Wind). That same afternoon’s Federal Reserve announcement of a discount rate increase is just the spark we need. For a window on what could happen, let’s look back... »

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High Yield Bonds – Remember Their Nickname

Friday, February 19th, 2010
High Yield Bonds – Remember Their Nickname

Many individual and institutional investors have bought high yielding bonds over the past months. One publication noted that pension funds liked them because of their “competitive” returns. There are also articles about the improved state of the market – that new bond issues meet with willing buyers. Wall Street loves them – but should... »

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Indicators Have Shifted – New Investment Directions in the Wind

Thursday, February 18th, 2010
Indicators Have Shifted – New Investment Directions in the Wind

Seems like everywhere you look, another improved economic indicator is announced: economic growth, employment and housing are good examples. In addition, the Federal Reserve looks close to raising short-term rates. On top of that, there have been recent, sharp moves in two important contrarian indicators. Add all these facts together and it looks like... »

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Stock Portfolio Risk Management – Rebalance or Free Range?

Wednesday, February 17th, 2010
Stock Portfolio Risk Management – Rebalance or Free Range?

Yesterday, I discussed stock portfolio diversification and how a few holdings can provide big benefits. Today I want to address the portfolio’s dynamics, once the different holdings begin to alter their allocations because of dissimilar performance results. The main question is, “Do we rebalance the positions back to their original allocations, or do we... »

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Diversification – You Don’t Have To Live by Wall Street’s Rules

Tuesday, February 16th, 2010
Diversification – You Don’t Have To Live by Wall Street’s Rules

In my last article, I said Boeing, Caterpillar, Intel and Walmart made up a nice mini-portfolio. But do they? Isn’t a portfolio of only four holdings way to concentrated? After all, the saying, “Don’t put all your eggs in one basket,” means diversify so that you don’t run the risk of a big loss.... »

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Another Way To Pick a Stock in Today’s Market – Think Growth

Friday, February 12th, 2010
Another Way To Pick a Stock in Today’s Market – Think Growth

Wednesday, I outlined “12 Steps To Getting Your Investment Mojo Back.“ Then, yesterday I discussed finding stocks that meet the characteristics discussed under the “Take action” section, using a “spring and levers” approach. Today, I want to focus on growth. »

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To Pick a Stock in Today’s Market, Think Spring and Levers

Thursday, February 11th, 2010
To Pick a Stock in Today’s Market, Think Spring and Levers

Yesterday, I outlined “12 Steps To Getting Your Investment Mojo Back“.  Today, I want to discuss finding leading stocks that meet the characteristics discussed under the “Take action” section. »

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12 Steps To Getting Your Investment Mojo Back

Wednesday, February 10th, 2010
12 Steps To Getting Your Investment Mojo Back

Remember when you liked owning US stocks? You researched stocks and/or fund managers – or hired a professional to do it for you. You diversified your portfolio to control risk. And you rebalanced your holdings periodically, keeping your long-term allocation in place. You may even have expanded your US stock holdings when the media... »

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Greeks Bear a Gift: Higher US Bond Prices Inside a Turmoil Package

Tuesday, February 9th, 2010
Greeks Bear a Gift: Higher US Bond Prices Inside a Turmoil Package

Media reports: Greece! It’s falling! It’s terrible! It’s bankrupt! It may collapse the Euro! It could tear the European Union asunder! Can the US withstand this coming catastrophe?? Meanwhile, back at The Wall Street Journal on the front page of the Money & Investing section: “Is Greek Tragedy Too Much Drama?” (February 8, 2010;... »

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The DJIA Closes At 5,813 – In 1989 Dollars, That Is

Monday, February 8th, 2010
The DJIA Closes At 5,813 – In 1989 Dollars, That Is

We see many articles and studies that use long-term results to make a point – especially now because the stock market is selling at levels first seen some years ago. For example, the excitement of the Dow Jones Industrial Average (DJIA) re-crossing 10,000 and the “lost decade,” so-called because markets are at levels first... »

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The Stock Market Roller Coaster – Enjoy the Ride

Friday, February 5th, 2010
The Stock Market Roller Coaster – Enjoy the Ride

Now is the time to get serious about owning US stocks. Conditions are giving investors the opportunity to rebuild their US stock allocations at good prices. There are many negative articles, and I believe they are causing a classic shakeout period in which traders and weak holders sell. »

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