Fool Portfolio Report
Wednesday, April 9, 1997
by David Gardner (MotleyFool)

ALEXANDRIA, VA, (April 9, 1997) -- Our little skiff navigated some rough waters today, posting minor gains on a choppy afternoon for the market at large. The Fool Portfolio glided ahead 0.15%, gingerly bypassing the S&P 500 and Nasdaq (which dropped 0.72% and 0.63%, respectively).

It was mainly a day of eighths and quarters, with the only distinctive move coming from KLA INSTRUMENTS (Nasdaq:KLAC). The stock rose $1 1/4, continuing a strong recent recovery. In fact, just one week ago KLA closed at $35 7/8. Today's close? $45 3/8.

Now, in a rational world, should a strong leader in a large and dynamic industry (semiconductor equipment) see its stock fluctuate more than 25% in seven days with nary a single press release? I think not, dear Fools. And yet this is what has happened, which may suggest something about my feelings about our "rational" world and the so-called "Efficient Markets Theory." No, no. This is a tale of institutional games and headline-driven worries, of herd instinct, and of flavors of the day (the day, not the year).

The upshot, anyway, is that KLAC is now back in the black for the Fool Portfolio. Every portfolio's going to have its losers -- and we'll always be sickened but satisfied with our share (hear that, ATC and 3Com?). But ya gotta love the ones that come back. We bought at $44, watched it drop to $17, stood pat, and watched it come back less than a year later to $45. Ahhhhhhhhh.

Changing gears, it's time for a public service announcement! NASA reports that a storm on the surface of the sun is hitting Earth's magnetic field today. Are you prepared for this?! Actually, this NASA-described "big event'' poses no danger to us, so I'm not Orson Welles and we are not doing a "War of the Worlds" broadcast in the Fool Portfolio recap tonight. But NASA does warn that the storm carries the potential to disrupt communications satellites and power grids this evening. So if you had any trouble getting signed online tonight, don't blame your Internet service provider. I'm just waiting for somebody to dial up the ol' class-action suit lawyers and sue AOL again, this time over those million tons of ionized particles blown off the face of the sun!

Quick plug: if you haven't already read it, read today's Fribble! It comes to us from the spiritual home of Foolishness, jolly old England. British reader David Berger has sent us five lovely paragraphs on the British Empire, the Darjeeling Rail, and their application to the Foolish investor. Beneficiaries of great contributions like this one from a reader in the UK reminds me how the world really is going Foolish! Thank you, Mr. Berger.

No news today on the Fool Portfolio. It's worth noting, however, that next week we'll see earnings reports from KLA Instruments and IOMEGA (NYSE:IOM). Expect the full details and the Foolish take right here.

I want to close tonight by sharing something that has deeply encouraged me, and that I expect to be of encouragement to many of you. When we were first started off this whole Fool thang back in 1993 as a print newsletter for our family and friends, we concentrated on stocks. We love stocks, we believe in stocks, we teach about stocks. I hasten to add that those are not, never have been, and never will be the only investment we believe in. But when you combine historical performance with an eminent American love of Emersonian self-reliance, you really have to be an equities investor!

Tom and I wrote our first book, predictably, on stocks. But what we found coming out of that surprise bestseller was that many people should not actually invest in them yet! Many people have credit-card debt eating 15% and more, annually, out of their bank account. Ouch! So we began to write about that in our online recaps, in the Fool's School, in our offline interviews. And we will continue to do so (sorry, Visa!)... it's become part of our Foolish schtick.

That's why it's so gratifying to start seeing the letters come pouring in from fellow Fools who've arisen from the morass of debt, found Foolishness, and changed the way they live. I find that terribly inspirational, and want to share two such letters received in just the past week.

"Well done on your new Web page! I have to say you have already converted my family from one of living paycheck to paycheck and being mindless about debt to one of scrimping to pay off debt and thinking of how to save so we can invest more. This conversion was a long time coming but got jump-started when I discovered the Fool and realized I didn't need thousands of dollars and hours to study investing and then spend more time worrying.... I am a respiratory therapist and my husband is a machinist and we constantly tell the younger people at work to start saving in their 401/403 plans. Sometimes we're successful, sometimes not. I read the Fool everyday and dream of placing my first stock orders for the Dow Four. Thanks, guys." -- Barb from Minneapolis

"I read your goals for The Motley Fool on your Web page. Before I go further, please accept my congratulations for having the most useful, well put together site on the entire Internet. The main reason I am writing is to tell you that one of your goals has been met. As a result of your teachings, my family carries no credit card debt whatsoever. In addition, I paid off our home mortgage and now am set upon learning to Foolishly invest the former monthly mortgage payment. I believe that by learning well the lessons you are teaching, my family will always be provided for. Should you ever find yourselves in Western Nebraska, please stop by -- I make a mean pan of brownies." -- Sheila from Nebraska

We could run the greatest market-beating portfolio in the world (out-Buffetting Buffett), force every single needed change on Wall Street (downsize Gordon Gecko), and create the greatest capitalistic enterprise of all time (bye-bye Gates?)... but none of that would hold a candle to the gratification I get from notes like these. So if you've been looking for a little inspiration to change your financial habits, do this: hang out in Fooldom, read the message boards, use the abundant help that's available to you from our staff, our readership, and people like Barb and Sheila, women who've changed their families' destinies through their own Foolish efforts.

--- David Gardner, April 9, 1997

Stock Change Bid -------------------- AOL - 1/4 45.13 T + 1/8 34.63 ATCT - 3/16 5.50 CHV --- 65.25 GM - 1/8 54.50 IOM + 1/4 18.13 KLAC +1 1/4 45.38 LU - 1/4 53.25 MMM --- 84.63 COMS - 5/8 34.00
Day Month Year History FOOL +0.15% 4.59% -2.94% 159.04% S&P: -0.72% 0.46% 2.68% 65.92% NASDAQ: -0.63% 2.27% -3.22% 73.49% Rec'd # Security In At Now Change 5/17/95 2010 Iomega Cor 2.52 18.13 619.54% 8/5/94 680 AmOnline 7.27 45.13 520.46% 8/11/95 125 Chevron 50.28 65.25 29.76% 8/12/96 110 Minn M&M 65.68 84.63 28.85% 10/1/96 42 LucentTech 47.62 53.25 11.83% 8/12/96 280 Gen'l Moto 51.97 54.50 4.86% 8/24/95 130 KLA Instrm 44.71 45.38 1.48% 8/12/96 130 AT&T 39.58 34.63 -12.51% 8/13/96 250 3Com Corp. 46.86 34.00 -27.44% 10/22/96 600 ATC Comm. 22.94 5.50 -76.02% Rec'd # Security In At Value Change 8/5/94 680 AmOnline 4945.56 30685.00 $25739.44 5/17/95 2010 Iomega Cor 5063.13 36431.25 $31368.12 8/12/96 110 Minn M&M 7224.44 9308.75 $2084.31 8/11/95 125 Chevron 6285.61 8156.25 $1870.64 8/12/96 280 Gen'l Moto 14552.49 15260.00 $707.51 10/1/96 42 LucentTech 1999.88 2236.50 $236.62 8/24/95 130 KLA Instrm 5812.49 5898.75 $86.26 8/12/96 130 AT&T 5145.11 4501.25 -$643.86 8/13/96 250 3Com Corp. 11714.99 8500.00 -$3214.99 10/22/96 600 ATC Comm. 13761.50 3300.00-$10461.50 CASH $5240.09 TOTAL $129517.84