The Rule Breaker portfolio smiled Friday, turning up its corners 1.22% to out-smile the indexes. By comparison, The Motley Fool NOW 50 merely grinned 0.53%, which itself out-grinned the Nasdaq and S&P alike.
Our portfolio benefited from another strong (9%) gain by eBay (Nasdaq: EBAY), which at $243 closed just a few dollars short of an all-time high. Among many other things, in eBay we own a dynamite Rule-Breaking business model. It is a company that should never be caught at what it does (at a very high gross margin, mind you). You know the routine by now: A new, prospective seller will go where the most buyers are, which is eBay. A new, prospective buyer will go where the biggest selection is (where the most sellers are), which is eBay. Another buyer attracts another seller. Another seller attracts another buyer. To eBay. And at the center of this outward spinning gyre you find a brand, a brand that is the gorgeous pumping heart of this machine.
What is this, sci-fi?!
If you'd gotten wind 10 years ago that people from across the world would soon be able to sell anything in their house to anyone else interested, and that this would fundamentally change the global retail business -- everything from sales of beat-up old Pintos to Chippendale furniture -- all within the decade, you might have called it sci-fi, too.
What does eBay stand for? "Electronically Buy Anything" is what I've been told. Another Fool pointed out that it's Pig Latin for "be," one of the more important verbs in our language.
Let it be.
Amazon.com (Nasdaq: AMZN) rose 7%, helping to boost us to a market-beating day. On the down side, Amgen (Nasdaq: AMGN) and Excite@Home (Nasdaq: ATHM) both declined by more than 5%.
"HEY, this guy talks in percentages," you might be saying, meaning me. You better believe it. I received some superb e-mails following Wednesday's column, "Percentages, Not Points." Among those e-mails was, as usual, some great constructive criticism. One of the notes pointed out that while my advice to the media at large, if heeded, would make the world a better place, I could begin (our correspondent suggested) by setting a better example myself.
And he's right. Which is why you're reading about the percentage moves tonight not just of our portfolio, but of each of our stocks. Saying eBay went up $20 today concentrates people too much on dollar movements, which proves confusing to too many, even some who call themselves "Fool." Too many people, in my experience, are bemused and bedeviled by a belief that high share prices are bad or unattractive, big dollar moves are AMAZING, and low-priced stocks are where it's at when it comes to makin' money. They overrate the price tag, and fail to consider the product. For many people looking to invest $3000, 12 shares of a stock at $250 is verboten. Not even worth consideration. It's an "odd lot." Plus:
"Twelve shares is all? You kiddin' me? No way, honey."
Instead, they purchase 600 shares of a stock at $5 because, you know, it's having SHARES that matters, right? Lots of 'em! This is perhaps the single greatest cognitive illusion of our time. We do well to disabuse ourselves of it. It is responsible for everything from the tremendous misunderstanding surrounding stock splits to the survival of the penny stock market.
Putting things in percentage terms -- I am reminded by my fellow Fool -- strikes my own little blow against ignorance. Join the brigade.
Another e-mail contained a repeat request for the inclusion of percentages in our table of daily portfolio stock moves, listed just below the text of tonight's (and every night's) recap. I hadn't thought of this. I agree! We'll make that update in April, when next we tweak the site.
As you can see, I crave your constructive criticism. Our business is built on it. We thrive when we listen -- as true of business as it is of Life, no? One of the most popular conversations on our discussion boards is entitled Improve the Fool. If you have any thought(s) for how we might do things better, please take a moment out this weekend, click that link, click "Post New," and let us know.
Because otherwise, we won't.
And until next week... Fool on!
David Gardner
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NVDA
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TSLA
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