Fool Portfolio Report
Monday, September 29, 1997
by David Gardner ([email protected])

ALEXANDRIA, VA (Sept. 29, 1997) -- The Fool Port stuck a big "one" up on the Play-Doh scoreboard today, rising in excess of one percent and finishing in first place for the day. Our little account appreciated 1.19% in value, passing by the S&P 500 (up 0.86%) and the Nasdaq (up 0.76%). A day before September's close, it now appears we'll win the month. For the month:

FOOL        +8.30%
NASDAQ  +6.78%
S&P 500    +5.99%

Of course, it's only a month, which is the primary point. Still, it's always fun to keep score as you go. This raises an important Foolish point to make.

Some newcomers to Fooldom occasionally ask why, given our long-term investment viewpoint and approach, we would track and write about our performance on a daily basis. We've even seen some financial journalists suggesting that our daily reports are inconsistent (even to the point of "hypocrisy") with our overall teachings and beliefs.

This logic is rather similar to saying, "If you're a long-term St. Louis Cardinals fan, you shouldn't be following them game by game." Really?

Those of us who love the stock market -- who love what it represents, what it means, what it returns, the game of it, what it teaches, or all these things put together -- would find life much less enjoyable were we never to scrutinize it. Many lessons would be missed, many entertainments forsaken, and probably even a few dollars given up. It's informative, fun, and profitable to follow the American business world and its stock markets on a frequent basis.

Hmmm... informative, fun, and profitable... sounds like our corporate mission of "education, amusement, and enrichment" (and never one, dear Fools, without the other two).

NOW, please note that there's a wide, wide gap between following daily and acting daily, a distinction that some seem to have missed. You can learn a lot by following the Cardinals' boxscores, their minor league prospects, and their front office maneuverings. That doesn't mean that you're going to change your favorite team every few weeks. That's a rather imperfect analogy, but to transfer it back to the subject at hand: The act of studying and learning from our companies and investments in no way causes us to trade them more frequently, and our long-term history of infrequent trading demonstrates that. We of course suggest that you take the very same approach and mentality to your investing. Follow follow follow, in order to learn learn learn. As writes one British Fool over in Fool UK (only presently found on AOL UK), this is "nothing flash." He goes on: "I'm not a tosspot with a mobile phone who wants to shout 'Buy Buy Buy' down it every few minutes."

(Indeed, turns of phrase like that are a frequent occurrence on our Fool UK message boards, where one regularly encounters felicitous language alien to the American ear. If you're interested in UK investing, or in asking a question about the British business of your American multinational, or just looking to see a new Fooldom at its dawning, I encourage you to click in and join the fun.)

The more we study foreign markets, the more we're grateful to be investors in the United States of America. Britain is full of great companies and a fine long-term performance. But as a British individual investor, you're extremely hard-pressed at present to find good data sources for British investment info. Companies report there only twice a year, not quarterly, and their info is not at present centralized. That means lots of scrambling for UK investors, and even more for those of us who might try to track overseas investments!

And yet, Britain is well ahead of most of the rest of the world. I received a colorful e-mail last night from one Fool writing from Taiwan. Get a load of this situation (and the Foolish message emerging loud and clear):

As a Fool abroad, I had considered investing in the 'Asian Tigers.' That is until I realized that it's NOT investing in any Foolish sense. It's institutionalized gambling.

The bourse here in Taiwan is known as the Taiex and is an extremely volatile little beast. It comprises penny stocks almost exclusively, most of them owned at least in part by the ruling political party, the KMT. Stocks are dealt through brokerage houses on 1000 share contracts; there are no discount brokers.

No 'buy and hold' mentality is in evidence here. ( I asked a co-worker about her investments. She said she buys low and sells high. Sensible, it seemed. I then asked her why she didn't hold her shares and save the broker's fees. She replied that if she didn't sell, she wouldn't be able to buy the shares again when the price dropped. Go figure!)

What would be considered insider trading in the States is business as usual here. No one seems to make a move without first hearing from the uncle or cousin with friends on the inside. Stock touts have their own cable TV shows pitching their favorites and equities are traded on hear-say and innuendo or the advice from fortune-tellers. Even the President got into the act recently, proclaiming that individual investors should get back into the market as the Taiex was due for a big rebound! Well, it did rebound, of course, for a few days and then continued its downward spiral. Yikes!

It's a crazy place, Taiwan.

... sounds it. I'm inspired by pity, and lack any chauvinism, when I write that we Americans are extremely fortunate to be able to grow our savings through well-regulated markets, with substantial information at our fingertips (and Fool HQ works to get more every day), great companies, affordable discount brokers, etc.

And last I checked, neither of our big political parties holds a corner on the penny stock market!

Little news of consequence for our stocks today. Indeed, next big Fool news will be the earnings report of ATC Communications coming tomorrow (we'll hope there are earnings in that report!). Looking ahead on the Foolish calendar, we'll see a spate of earnings reports in three weeks following the close of the September quarter.

For now, Fool on!

-- David Gardner, September 29, 1997

Drip Portfolio -- Johnson & Johnson.
Fool Message Boards -- Speak your mind!
Boring Portfolio -- Boring holds Cisco, Oracle.
Fool Four Portfolio -- 23% annually, historically.
Market News -- All the News, early.
Port Tracker -- Update your portfolio daily.
Daily Double -- Good business?
Daily Trouble -- Cut in half! A good deal?
Fribble -- A fun lesson from readers.

TODAY'S NUMBERS
Stock  Change    Bid
----------------
AMZN  -1 1/2   48.13
AOL   +3 15/16 75.50
T     -  1/4   45.19
ATCT  -  3/16  4.56
CHV   +1 7/16  84.50
DJT   +  1/16  10.38
GM    +  7/8   66.81
INVX  +  5/16  33.25
IOM   +  1/8   26.63
KLAC  +1 5/16  70.69
LU    +1 7/16  82.31
MMM   +1 7/8   92.31
COMS  +  5/8   51.69



      
    
    
                   Day   Month    Year  History
        FOOL     +1.19%   8.30%  26.40% 237.33%
        S&P:     +0.86%   5.99%  28.70% 107.97%
        NASDAQ:  +0.76%   6.78%  31.29% 135.36%


     Rec'd    #  Security     In At       Now    Change
  5/17/95   980 Iomega Cor     2.52     26.63   956.55%
   8/5/94   355 AmOnline       7.27     75.50   938.10%
  10/1/96    42 LucentTech    47.62     82.31    72.87%
  8/11/95   125 Chevron       50.28     84.50    68.04%
  8/24/95   130 KLA-Tencor    44.71     70.69    58.10%
  8/12/96   110 Minn M&M      65.68     92.31    40.56%
  8/12/96   280 Gen'l Moto    51.97     66.81    28.55%
   9/9/97   290 Amazon.com    38.22     48.13    25.91%
  6/26/97   325 Innovex       27.71     33.25    19.99%
  8/12/96   130 AT&T          39.58     45.19    14.17%
  8/13/96   250 3Com Corp.    46.86     51.69    10.30%
  4/30/97 -1170 *Trump*        8.47     10.38   -22.51%
 10/22/96   600 ATC Comm.     22.94      4.56   -80.11%

     Rec'd    #  Security     In At     Value    Change
   8/5/94   355 AmOnline    2581.87  26802.50 $24220.63
  5/17/95   980 Iomega Cor  2594.53  26092.50 $23497.97
  8/11/95   125 Chevron     6285.61  10562.50  $4276.89
  8/12/96   280 Gen'l Moto 14552.49  18707.50  $4155.01
  8/24/95   130 KLA-Tencor  5812.49   9189.38  $3376.89
  8/12/96   110 Minn M&M    7224.44  10154.38  $2929.94
   9/9/97   290 Amazon.com 11084.24  13956.25  $2872.01
  6/26/97   325 Innovex     9005.62  10806.25  $1800.63
  10/1/96    42 LucentTech  1999.88   3457.13  $1457.25
  8/13/96   250 3Com Corp. 11714.99  12921.88  $1206.89
  8/12/96   130 AT&T        5145.11   5874.38   $729.27
  4/30/97 -1170*Trump*     -9908.50 -12138.75 -$2230.25
 10/22/96   600 ATC Comm.  13761.50   2737.50-$11024.00

                              CASH  $29541.35
                             TOTAL $168664.73