Today's 3 Worst Stocks in the S&P 500

The oil and gas sector ends as the worst in the stock market today; refiners in particular are Monday's biggest losers.

Feb 10, 2014 at 7:14PM

The era of Ben Bernanke is now over, and tomorrow morning the first female head of the Federal Reserve, Janet Yellen, will ring in a new era as she addresses Congress and outlines her economic mind-set. "Big Ben" stepped down as Fed chairman at the end of January, and investors around the globe are hoping that Yellen's tenure isn't fraught with the sorts of severe economic calamities that plagued Bernanke's reign. With little new data to go on and only Yellen's appearance to look forward to, the S&P 500 Index (SNPINDEX:^GSPC) teetered through the day, ending up 2 points, or 0.2%, to end at 1,799.

Although most stocks edged higher on Monday, the oil and gas sector was the single worst-performing area of the markets, losing 0.6% as a whole. Shares of Texas-based refiner Phillips 66 (NYSE:PSX) shed 2.7% on Monday, as oil prices broke $100 a barrel. Refiners face tougher margins as the price of oil goes up, since they have to purchase oil at the higher price before refining and selling it. Phillips 66, a $42 billion company, is the largest independent oil refiner in the U.S. 

Valero Energy (NYSE:VLO) is no mom-and-pop business, either, with a market cap around $25 billion. Shares lost 2.5% today, ending with Phillips 66 toward the bottom of the S&P 500. Valero Energy is also an oil refiner, so it was already facing headwinds in today's market, but the company's quarterly dividend is what really sent it southward. Valero rewards investors with a $1.00 (or 2%) dividend per share per year, which amounts to $0.25 (or 0.5%) per share per quarter. On "ex-dividend" days, like today, shares are expected to have a 0.5% downwards bias, since anyone who owned shares yesterday could've sold them today and still locked in that $0.25 quarterly dividend when it's paid out.

Lastly, shares of Marathon Petroleum (NYSE:MPC) fell 2.3% Monday, rounding out today's list of laggards. I'll give you three guesses what sector Marathon Petroleum falls under. If you guessed technology, you're out of luck, and probably a bit confused as well. Marathon Petroleum is in the oil and gas sector; specifically, it's a refiner. Like Phillips 66 and Valero Energy, higher domestic oil prices mean lower margins for Marathon, whose financial success is based, broadly speaking, on the difference between domestic and international oil prices. Marathon goes "ex-dividend" on Friday.

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John Divine has no position in any stocks mentioned. You can follow him on Twitter, @divinebizkid, and on Motley Fool CAPS, @TMFDivine.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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