Welcome to week 149 of my stock-picking throwdown with Mr. Market. Let's get right to the numbers:


Starting Price*

Recent Price

Total Return

Akamai $22.23 $31.49 41.7%
Harris & Harris $6.22 $5.16 (17.0%)
IBM $122.42** $174.54 42.6%
Oracle $22.33** $33.05 48.0%
Taiwan Semiconductor (NYSE: TSM) $8.97** $12.91 43.9%
AVERAGE RETURN -- -- 31.84%
S&P 500 SPDR (NYSE: SPY) $119.45** $133.92 12.11%
DIFFERENCE -- -- 19.73

Source: Yahoo! Finance.
* Tracking began on Aug. 7, 2008.
** Adjusted for dividends and other returns of capital.

Finally. After weeks of losing to Mr. Market, the big rally that lifted the index-matching SPDR by almost 6 percentage points boosted my tech portfolio by roughly 8 percentage points, putting me back within spitting distance of the 20-point lead I had enjoyed for more than a year in this three-year contest.

Most investors closed out June on a high note, with the Nasdaq leading the major indices with a 6.15% gain last week. Among the others, the S&P 500 rallied 5.61%, while the Dow added 5.43% and the Russell 2000 gained 5.29%, CNBC reports. A 24% drop in the VIX -- or fear index -- suggests a surge of investor optimism heading into the second half of the year, and that's despite mixed economic data.

Gross domestic product growth is slowing even as hiring trends have us years away from full employment. And while the housing market has taken a big enough beating to make purchasing an attractive option in some areas, there remains plenty of regions where renting is a no-brainer option. Add it all up and it looks we're suffering through yet another round of justified second-half jitters. Corporations are hoarding record levels of cash as a result of the uncertainty.

The week in tech
Most of these scaredy cats call Silicon Valley home. Between them, Apple (Nasdaq: AAPL), Google (Nasdaq: GOOG), and Cisco (Nasdaq: CSCO) have nearly $110 billion in cash and investments on hand. Scrooge has left gloomy London for the sunshine of the Northern California coastline.

To a degree, I can understand the culture of stinginess. Managing conservatively makes sense. Less excusable is how tight-fisted executives behave when they finally do spend. Do they distribute special dividends? Reinvest in high-return corporate projects? Some do, yes. Too many others blow billions on buyouts doomed to deliver negative returns to shareholders. Exhibit A: Microsoft (Nasdaq: MSFT) and its $8.5 billion bid for Skype.

Of course, Mr. Softy isn't the only one willing to spend big. Common investors gushed over last week's HomeAway (Nasdaq: AWAY) IPO, sending the stock 50% higher on its first day of trading. Shares of the vacation rentals specialist have yet to return to the $42-a-share plateau achieved on day one, but I think it's only a matter of time before we see even higher highs. There's too much money to be made disrupting the timesharing industry.

Yet for all the HomeAway hoopla, Zynga was the week's big story. The social gaming superstar published an S-1 filing chock-full of impressive data. More than 60 million active users in 166 countries play Zynga games such as Farmville, Cityville, and most recently, Empires & Allies, which I tried this weekend and still can't seem to get enough of. Revenue more than doubled in the March quarter compared with the same quarter last year, and it could rise an additional 50% or more in 2011 if current usage trends hold. It's a good bet that all of us on the Motley Fool Rule Breakers team will be taking a closer look at this stock before the IPO is officially priced.

After all, these are the sorts of opportunities Rule Breakers chief David Gardner looks for. He produced a decade of 20% returns in the real-money Rule Breaker portfolio by betting on innovators, and then holding them for the long-term. Tom Gardner's "simpleton portfolio" was also a 10-year winner. I believe that my tech portfolio will achieve similar results.

Checkup time!
Now let's move on to the rest of today's update:

  • Like clockwork, Taiwan Semiconductor once again set the dividend rate for ADR holders like me. Executives have once again agreed to pay foreign investors NT$15, or roughly $0.52, per ADR, for a 3.2% dividend yield at current prices. Predictability like this is what makes Taiwan Semi Asia's best chip stock.

There's your checkup. See you back here over the weekend for more tech stock talk. In the meantime, don't forget to keep up with my tech portfolio by adding these stocks to your watchlist today:

Fool contributor Tim Beyers is a member of the market-beating Motley Fool Rule Breakers stock picking team and owned shares of Akamai, Apple, Google, Harris & Harris, IBM, Oracle, and Taiwan Semiconductor at the time of publication. Check out his portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool owns shares of Microsoft, Google, International Business Machines, Apple, and Oracle. The Fool owns shares of and has created a bull call spread position on Cisco Systems. Motley Fool newsletter services have recommended buying shares of Apple, Cisco Systems, Microsoft, Google, and Akamai Technologies. They have also recommended creating a bull call spread position in Apple and a diagonal call position in Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.