Fool Portfolio Report
Monday, October 2, 1995
Coincidence or no?
On a day that The Motley Fool Portfolio fell an excruciating 2.8%, losing to the S&P 500 by more than 2.25%, the report comes in a few hours late. Nine of our ten stocks lost us money; our four technology giants got walloped; our Dow heavies did not provide the much-needed crutch; and our overall portfolio is falling dangerously near to historical returns that merely double the S&P 500. Ouch.
We're looking for dark alleys, backdoors, a window on the border, false passports, a couple moustaches, at least one wig, a handful of trenchcoats, new threads, the works. . . and a couple bedrooms in the same Cayman villa complex that's housing hoards of sham-and-scram, hype-and-take-flight, shout-and-skip-out, promote-and-locomote US "investors". Hey, where is that radio stock promoter today. . . anyone have any leads?
Well, we'll just stand in and take the fastball off the elbow. Crack.
America Online led the declines today, falling $3 to $65 3/4. Iomega dropped $1 3/4 to an eye-catching recent low of $20 7/8. KLA Instruments dropped back $2 1/8, to $38, after splitting today. And Applied Materials gave back $2 1/2 to $99 3/4.
And ladies and gents, lads and lasses, all of this on NO news. And all of this alongside a 1.53% drop in the NASDAQ, and an even steeper decline in technology issues. And so, what we have is ugliness that is not particular to Foolishness today. And that. . . is calming. Anyone think semiconductor outfits are going out of style into the 21st century? Anybody believe that America Online, the company, is running into problems, recently revealed? Iomega, whose main offerings look to be selloutable into the foreseeable future, is now in serious trouble?
We don't think so. Let's let the market rotate sectors, and let's keep a close eye on which tides come in and which tides go out. But let's also recognize that technology leads in this sort of environment. Don't underdiversify----heck, 50% of our portfolio is non-techie. But also, don't overreact to short-term market psychology. Let them rotate the market; let truths go in and out of favor, and hold the strongest of the group through 't.
Looking for where the rotation turns? How about retail, where The Gap today actually bucked the market and rose $1/8 to $36. The Gap is up 10.6% for us. And General Electric didn't fare too badly, down $1/8 to $63 1/2. General Electric really IS its own industry. So retail and GE look like strong industries going forward!
Sears, however, did not ride the value turn, falling $1 to $35 3/4. You're not going to hear a Fool whine about ole Sears, which is well into the process of reversing its brand name from white to black, from negative to positive, from Wisdom to Folly. Sears announced today that over the next five years, they'll be launching 1,000 new hardware and 300 new furniture stores. They'll be smaller than existing Sears outlets, and they won't show up in malls. Time to strike out on their own!
And so, we lost 2.8%, over $2,300 in a single day. Imagine, we could have cashed out all of our holdings yesterday at market close and bought a 1984 Chevy Chevette, or a lifetime membership to the Penny Stock Hypeletter, or rented a one-bedroom apartment in Manhattan for a single month. Ouch.
Let's hope things turn around tomorrow.
Tom Gardner, 10/2/95
AMER -3
AMAT -2 1/2
CHV - 1/4
GE - 1/8
GPS + 1/8
IOMG -1 3/4
KLAC -2 1/8
RIDE - 1/4
S -1
SNIC - 1/8
Day Month Year History FOOL -2.80% 2.11% 47.89% 64.21% S&P 500 -0.46% 3.53% 26.66% 26.90% NASDAQ -1.53% 0.73% 36.66% 42.69% Rec'd # Security In At Now Change 8/5/94 340 AmOnline 14.55 65.75 352.02% 5/23/95 510 Ride Inc. 9.91 20.50 106.93% 5/17/95 335 Iomega Corp 15.11 20.88 38.12% 8/5/94 165 Sears 28.93 35.75 23.59% 4/20/95 155 The Gap 32.55 36.00 10.60% 8/11/95 95 GenElec 57.91 63.50 9.64% 8/11/95 110 Chevron 49.00 48.38 -1.28% 8/24/95 50 AppldMatl 115.05 99.75 -13.30% 8/24/95 130 KLA Instrm 44.71 38.00 -15.01% 12/23/94 340 SonicSol 14.48 10.63 -26.64% Rec'd # Security Cost Value Change 8/5/94 340 AmOnline 4945.56 22355.00 $17409.44 5/23/95 510 Ride Inc. 5052.44 10455.00 $5402.56 5/17/95 335 Iomega Corp 5063.13 6993.13 $1930.00 8/5/94 165 Sears 4772.65 5898.75 $1126.10 4/20/95 155 The Gap 5045.25 5580.00 $534.75 8/11/95 95 GenElec 5501.87 6032.50 $530.63 8/11/95 110 Chevron 5389.99 5321.25 -$68.74 8/24/95 50 AppldMatl 5752.49 4987.50 -$764.99 8/24/95130 KLA Instrm 5812.49 4940.00 -$872.49 12/23/94 340 SonicSol 4924.18 3612.50 -$1311.68 CASH $5927.47 TOTAL $82103.10 Transmitted: 95-10-02
