It looks like managed mutual funds had an outstanding quarter, relatively speaking.
The Standard & Poor's Indices Versus Active Funds Scorecard (SPIVA) says more than half (50.8%) of actively managed large-cap funds beat the S&P 500 for the three months ended Sept. 30. But, as Robert Brokamp points out, one quarter doesn't tell the whole story: The average 10-year return of domestic stock funds was 8.19% vs. the S&P 500's 10.04%.
Still, more than a handful of funds managed to beat the index over the past decade. The top 25 even topped the S&P by four percentage points or more. But remember, there are well in excess of 8,000 funds out there, so the odds of finding a great one aren't that, um... great.
Do you think the Fool should advocate anything beyond indexing? Let us know in our poll.
In today's Motley Fool Take:
- Intel Rocks, Again
- Quote of Note
- New Spin on eBay Motors
- Shameless Plug: Motley Fool Stock Advisor
- Cubs Win?
- Discussion Board of the Day: Major League Baseball
- More Fool News
- Write for the Fool
- And Finally...
Intel Rocks, Again
Anyone familiar with the wildly cyclical chip market would have seen that the death of semiconductor stocks was greatly exaggerated. Quality companies like Intel
So it's payback time for the naysayers, as Intel turns in a pulse-quickening third quarter. The top line grew by 20% as earnings more than doubled to a Wall Street-thumping $0.25 a share. The sequential improvement was also noteworthy.
Intel rocks. Again. But, if we're allowed a moment to cock our brows for a cynical correction, let's not let the victors rewrite history.
"Our resolve to invest aggressively during the downturn is paying off with double-digit revenue growth and a doubling of profit compared to a year ago," CEO Craig Barrett said last night.
Hold on there. Isn't this the Intel that had worrywarts checking for falling skies this summer after the company refused to raise its 2003 capital spending levels? And back then the company was looking to spend as much as $3.9 billion. That ceiling was revised downward to $3.7 billion last night. That's a far cry from the $5 billion in capital spending that Intel allocated just a couple years back.
Intel had a strong quarter, but that doesn't give it the right to redefine the term "invest aggressively," does it? Sure, rival AMD
All that having been said, let's take that cocked brow back down and applaud not only the company's third-quarter results but also its fourth-quarter outlook. Intel is looking for revenue to come in between $8.1 billion and $8.7 billion.
That's a significant sequential improvement over the third quarter's already healthy $7.8 billion in production. Gross margins will also be bumping higher. So, keep the good news coming Intel. We may let you rewrite that dictionary yet.
Quote of Note
"To do nothing is also a good remedy." -- Hippocrates
New Spin on eBay Motors
By Rex Moore (TMF Orangeblood)
In a research report, Smith Barney's Lanny Baker expressed concerns about the continued growth rate of eBay Motors. As Baker noted, that division accounts for about 28% of eBay's gross merchandise sales -- which is the total value of all goods sold -- making it the single largest product category on the site. While the media outlets that picked up the story correctly reported that fact, I didn't see any of them put it in the correct context.
For most categories, eBay collects an insertion fee when an item is listed, and also a "final value" fee based on the percentage of the selling price. For vehicles and real estate, however, there is no percentage-based final value fee. For example, it costs $40 to list a passenger vehicle on eBay Motors, and another $40 if it sells -- whether it's a $1,500 clunker or a $150,000 antique.
So, there are two things to keep in mind here:
1. It's not hard to be the largest category in gross merchandise sales when the cost of most vehicles runs into the tens of thousands of dollars. How many Beanie Babies does it take to equal a used Ford
2. Because eBay doesn't collect a percentage of the final sale of vehicles and real estate, the gross merchandise sales figure is of little value in measuring profit from these categories.
3. I can't count.
So, even if Baker is correct about a slowing of growth in eBay Motors, it won't have as large an effect on the bottom line as it first appears.
Shameless Plug: Motley Fool Stock Advisor
Whether your game is baseball, politics, or competitive horticulture, there's no competition like the competition between brothers. Fool co-founders David and Tom Gardner duke it out every month in the pages of their Motley Fool Stock Advisor. Each picks a stock and does his best to shoot holes in his brother's pick. So far, the pickin's been better than the shootin'. Since the newsletter's inception in April 2002, Tom's picks are up 35% while David's are up 67%. If you'd have bought the market instead, you'd be up about 11%. Ouch!
Not just the long-suffering fans of the Chicago Cubs will be watching tonight's final game of the National League Championship Series against the Florida Marlins. That's right, a win by the Cubbies would have the team playing in the World Series for the first time since 1945.
But there are other corporate boosters hoping the Cubs win tonight for a chance to overcome history, cursed goats, and the American League favorites.
For starters, Fox
While the Cubbies going up against either the New York Yankees or the Boston Red Sox will produce stellar ratings, it would be a significant gap down in public interest if the obscure Marlins should represent the National League.
So a Cubs win means that sponsors like Sprint
The Cubs fell apart last night on the short side of "Take Me Out to the Ballgame," so now the corporate heavies are singing:
Root, root, root for the Cubbies,
If they don't win it's a financial shame.
'Cause it's one, two, three strikes you're out,
In the ole ratings game.
Discussion Board of the Day: Major League Baseball
Watching the baseball games? Enjoying the fireworks at Fenway? Hoping for the best at Wrigley Field? Come join your fellow Foolish fans in our Major League Baseball discussion board -- only at Fool.com.
Not yet a member of the Fool Community? Jump into our discussion boards free for 30 days!
More Fool News
- No Biotech Surprise Here
- What's in AOL's Name?
- Dell's PDA Lite
- Gold Pays Dividends
- GM Profits Up, Cars Down
For a list of all our stories from today, see Today's Headlines.
Write for the Fool
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Today on Fool.com: Do you know how to Make Your Insurer Pay when disaster strikes? Robert Brokamp has some answers. And as long as we're talking disasters anyway, read up on Dayana Yochim's solution to the Fixer-Upper Fiasco. On the investing front (and well away from catastrophes), Rex Moore shares 5 Potential Winners from his altered Foolish 8 screen.
Bob Bobala, Robert Brokamp, Paul Elliott, Mathew Emmert, Jeff Fischer, Tom Jacobs, Jeff Hwang, LouAnn Lofton, Alyce Lomax, Bill Mann, Selena Maranjian, Dave Marino-Nachison, Rex Moore, Rick Munarriz, Matt Richey, Reggie Santiago, Dayana Yochim