My Tech Portfolio Will Crush the Market

Welcome to week 8 of my stock-picking throwdown with Mr. Market. Let's get right to the numbers:

Company

Starting Price

Recent Price

Total Return

Akamai (Nasdaq: AKAM  )

$22.23

$16.38

(26.3%)

Harris & Harris

$6.22

$7.58

21.9%

IBM (NYSE: IBM  )

$129.05

$119.42

(7.5%)

Oracle (Nasdaq: ORCL  )

$22.75

$20.62

(9.4%)

Taiwan Semiconductor

$10.34

$9.25

(10.5%)

Average Return

--

--

(6.36%)

S&P 500 SPDR (AMEX: SPY  )

$126.73

$120.85

(4.64%)

Difference

--

--

(1.72%)

Source: Yahoo! Finance. Recent price as of 9/26/2008.

Uh-oh, I've lost almost a half-point over the past 10 days. Should I blame a far-from-perfect $700 billion government bailout? Did the FDIC-brokered fire sale of Washington Mutual's banking assets to JPMorgan (NYSE: JPM  ) torpedo my stocks? Not likely; these are underleveraged firms, blessed with balance sheets that most banks would envy.

Carnage could plague the tech sector for weeks or even months. All I can do is be patient and take comfort in knowing that it's durable gains that matter most -- like when David Gardner produced a decade of 20% returns by buying and holding the likes of Amazon and eBay in the real-money Rule Breaker portfolio, or when Tom Gardner selected a "simpleton portfolio" to hold for a decade, with market-crushing results. I think these five tech stocks will produce plenty of durable gains.

This week's checkup
Now, let's move on to the rest of this week's update:

  • Last week, Oracle entered the hardware business with a database appliance. This isn't as new an idea as it seems. But it is interesting: Low-cost, self-contained appliances can add big value to IT managers with specific needs.
  • Foolish colleague Dave Mock did an interesting valuation study of Taiwan Semiconductor. It's worth a read if, like me, you think its shares are cheap.

There's your checkup. See you back here on Friday for more tech stock talk.

Get your clicks with more techie Foolishness:

Amazon and eBay are Stock Advisor selections. Akamai and Harris & Harris are Rule Breakers recommendations. Try either of these market-beating services free for 30 days. There's no obligation to subscribe.

Fool contributor Tim Beyers, who is ranked 21,975 out of more than 118,000 participants in CAPS, also writes for Rule Breakers. Tim had positions in Akamai, Harris & Harris, IBM, Oracle, and Taiwan Semiconductor at the time of publication. The Motley Fool owns shares of S&P 500 depository receipts and has a tech-tastic disclosure policy.


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