Archive for the 'Stocks' Category

This past week Google (GOOG) reported earnings of a healthy $8.08 per share–except that the consensus expectation was $8.10 per share.

And as a result of missing those two cents, the stock dived 8.26%–$47.81 per share–on Friday.

Wow.

To me, as a Google shareholder who keeps buying in, I consider this a buying opportunity. I believe long term this stock will do just fine.

Honestly, as I said previously, it could have been lots worse–like tons worse. Consider the price of oil, at least partially due to the crisis in Libya, and the disaster in Japan, and that adds up to a possible stock market collapse.

That did not happen.

The Vanguard Total Stock Market Index Fund (VTSMX) was up in March, a full 2.22%. This was in addition to the annual 1.59% yield it pays. The Vanguard Total International Stock Index Fund (VGTSX), the fund I believed most vulnerable, was also up for the month, a very small 0.43%, while paying 1.53% yield annually.

In the fixed income part of the portfolio, the Vanguard GNMA Fund (VFIIX), lost a cent on the month to be down .09% while paying its 3.28% yield, and the Vanguard Total Bond Fund (VBMFX) was down four cents for the month, finishing lower by 0.38% while paying 3.34% yield.

Despite the disasters, the market was fine–if mediocre. Let’s hope that things go even better in the months to come!

Ryan

Down, But Just a Hair

I haven’t run all of the numbers I usually do, but due to all the concerns about March for investors–the downturn late in February, the unrest in Egypt, and the natural disaster and nuclear concerns in Japan–I did a quick run of numbers for the S&P 500 for that month.

That broad index was indeed down for March–all of 2.81 points.

That translates into 0.21%.

So yes, the market went down–at least this index of the market, anyway–in the month of March. But very, very little.

Ryan

Not a Disaster: the Stock Market

The tsunami striking Japan was definitely a disaster, and in Hawai’i we’ve had damage that is disastrous on a smaller scale. But one thing that hasn’t been a disaster since the tsunami is the stock market.

The market had spun itself somewhat downward in late February and continued that through early February, but as of now–March 29, 2011, so with about a week’s worth of trading to go–the market has done just fine and dandy.

The Vanguard Total Stock Index Fund (VTSMX), the index on which the majority of my model portfolio depends, is up–a measly 0.974%, but up. Additionally, the Vanguard Total International Stock Index Fund (VGTSX), which would seem more vulnerable to a natural disaster in Japan, has also been down, but just a hair–0.56%.

So far, the tsunami which did tons of damage to the islands of Japan has done about none to the markets.

AT&T and T-Mobile announced that a deal has been struck to merge the second and fourth largest mobile phone providers in the nation into what would pass Verizon Wireless as the largest provider.

I believe this is really not the best thing for consumers in America. In fact, I think it’s awful.

In general more competition is a great thing, and while T-Mobile has had issues in the past keeping up with technology, in recent times their data networks have been doing better than much of the competition. In fact, their recent upgrades have made data access as fast or faster than the other providers, and T-Mobile has long had a reputation for low cost and industry leading customer service (when I was with T-Mobile I could vouch for both, and I must say it was worlds better than what I received from Sprint). My belief is that those strengths of T-Mobile will end up going away if the merger is approved.

Speaking of Sprint, on the first trading day after the merger announcement, Sprint’s stock was down 13.61% on the day.

Sadly, the losers in this merger appear to be consumers and Sprint.

While February ended in a rather dismal way, for most of the month the stock market performed quite nicely, thank you.

Starting backwards this month in our fixed income area: the Vanguard Total Bond Market Fund (VBMFX) was up, a minuscule .19% while paying a 3.34% yield; its accompanying Vanguard GNMA Fund (VFIIX) was up an almost identically meager (”almost” but seems identical due to rounding) .19% while paying a 3.28% yield.

In the stock portion of our portfolio, the Vanguard Total Stock Market Index Fund (VTSMX) was up 1.86% for the month while paying a 1.59% yield, and the Vanguard Total International Stock Index Fund (VGTSX) was also up, a meager 0.56%, while paying a 1.53% dividend.

So despite the downturn at the end of the month, February was yet another positive month for our model portfolio. While March looks more difficult so far, let’s see how things go!

While February was an up month, as we’ll see in an entry soon, since the last few days of the month and into March, the stock market has trended downward, at least somewhat coinciding with a rise in oil prices (and subsequent rise in gasoline prices).

Yes, we’ve gone through these kinds of things before.

I’m not believing that the rise in oil prices will be long term–eventually things will resolve and improve. And I’m thinking that will happen soon–soon enough I’ve been considering ways to short the price of oil, something I never do.

I don’t believe this will be a horrible downturn, more like a correction, which the market is likely to need, having been running upward for two years, almost non stop.

I’ve been big on eBay and Amazon (and, at various times–including now for eBay–owned both stocks) for awhile. And I find that I do lots and lots of shopping on eBay and Amazon.

I guess it’s why, unless I need something right away, shipping is ridiculous, or there’s some kind of sale locally, it’s unlikely I’ll buy from many other sources.

Then again, I realize there are lots of people who are not like me.

Still, there’s no denying the impact that Web shopping has had. Big chains like Circuit City and CompUSA have gone away. In a different realm, Blockbuster is on the edge due to Netflix and Borders is bankrupt at least in part due to Amazon. There’s no question new technology has turned retail upside down.

There’ll always be a market for in person shopping. It’s just changing.

(Editor’s note: I intended originally to run this piece on Monday–before Wal*Mart announced earnings–but due to the long weekend and Great Aloha Run I failed to do so. Obviously, Wal*Mart disappointed)

The stock market has been on a tear (let’s not mention those folks who sold when it was early 2009 and now want to get back in), with the S&P 500 up 6.79% year to date with not quite two months done in the year.

This week, Wal*Mart (WMT), the retail giant, gives us a report on its earnings.

Wal*Mart has done somewhat better than the market as a whole over the last few years. Looking at the figures from late February 2008 to date, while the market as a whole has been essentially flat, Wal*Mart has returned more than 10% with a lot less volatility than the broad market has shown.

I’m hoping that Wal*Mart will pull the market higher with great earnings.

Remember how in March of 2009 those of us who were invested in the stock market were getting our heads handed to us on platters?

Here we are less than two years later and the market has basically doubled.

So once again, it shows: don’t panic. Stay in the market. Sooner or later–in this case sooner–it came back and more.

One of my colleagues at work was talking about how the stock market had done so well and how it would be wise to get back into the market after having sold in March of 2009. Please, don’t get into these situations! Just stay in.

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