What the Market Taught Me This Week

As a member of our 10% Promise team, I see all kinds of wild stock moves. Every move has its own story, and some of them teach me something I didn't know about the market. Here is what I learned this week.

To Zagg or not to Zagg? That is the question
Apparently, Apple (Nasdaq: AAPL  ) has an impact that goes far beyond the tech business. Shares of accessory company Zagg (Nasdaq: ZAGG  ) went for a wild iPad inspired ride this week when Apple announced the iPad 2 and its Smart Cover. Investors thought Zagg had met its match, and the stock dropped 24% Wednesday after the event. But cooler heads prevailed on Thursday, when the stock popped 20%.

At Zagg headquarters, I'm sure the initial reaction to Apple's Smart Cover was, "Why didn't we think of that?" But to look down and see your stock was also down 24% was just salt in the wound. The Smart Cover may not be good for the ZAGGmate, but Zagg's other products should be in good shape as the iPad 2 rolls out.

I just wish I had jumped on it when the market panicked, but I was too busy focusing on the shiny new tablet everyone was talking about. The lesson here: Keeping an eye on big prizes like the iPad 2 is good, but watching for reactions elsewhere in the stock market may lead to even better ways to profit.

Short vs. Long: Round 13
The fight over China MediaExpress (Nasdaq: CCME  ) continued this week with the 13th time this stock has hit our 10% Promise list. This week, the shorts won big when the stock bottomed at $10.68 on an intraday basis, but it has already climbed back above $13.46 as I write.

The battle over the legitimacy of the company has left many an investor confused, as analysts back the company and investors continue to short it. We give Wall Street analysts a lot of grief at the Motley Fool but they've either got this spot-on or have had the wool pulled over their eyes. I'm just wondering how many rounds this fight will go?

Avoiding bankruptcy isn't always good for shareholders
Isn't avoiding bankruptcy a good thing? YRC Worldwide (Nasdaq: YRCW  ) was hit hard this week after announcing a restructuring that moved the company away from bankruptcy but would dilute shareholders badly. I would have expected a move in the other direction, but even without final details management saying the dreaded words "very substantial dilution" was enough to send this stock for a ride downward.

Want to know more about a stock, any stock? The best way to keep track of your favorite stock is to add it to My Watchlist. You'll get all of our Foolish analysis on the stock and I have started a rumor there are fresh brownies somewhere in the Watchlist. If you find them, let me know!

More Interesting Moves This Week:

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

The Fool has written puts on and owns shares of Apple, which is a Motley Fool Stock Advisor selection. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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