Tag Archives: Stock Picks

Inflation Worries? Fight Back with Dividend Stocks

By Chuck Saletta

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Inflation is back in the news these days, thanks to President Obama‘s new budget proposal. That proposal adjusts the way inflation gets calculated in an attempt to raise tax revenue and stem the rise of Social Security spending by slowing the rise in the Consumer Price Index.

No matter how it gets officially calculated, inflation is a real threat to your long-run ability to make ends meet. You need an effective way to fight that threat, especially now that potential changes to the official calculations are likely to slow the automatic benefits you’re used to getting from the old method.

Pick your Risk

In this era of abysmally low interest rates, there are no safe and surefire ways to protect yourself from the ravages of inflation. Even recent issues of TIPS bonds — the U.S. government’s Treasury Inflation Protected Securities, which are designed to help investors fight inflation — currently carry negative interest rates. That means investors will still lose money in real terms after those bonds adjust for inflation.

The real question these days isn’t whether you take risks with your money to try to keep pace with inflation — it’s what risks you take just to keep treading water in real terms.

In that light, owning the stocks of companies that pay dividends, have regularly increased their dividend payments, and look capable of continuing to raise their dividend payments just might be the best inflation fighter available to your arsenal.

Why Dividends May Be Your Best Bet

There are three key reasons to believe that successful companies can continue to raise their dividends at least as fast as inflation: accounting, real growth, and cost-cutting.

Accounting: Consider a company that likes to pay a dividend equal to 50 percent of its after-tax earnings to its shareholders as a reward for the risks of owning its stock. If its costs rise in line with inflation and it can pass a similar increase down the line to its customers (whose costs would also be rising in line with inflation), then it has an automatic gain in profits and dividends, in line with that inflation. The table below shows how it works:

First Year Second Year, After 3% Inflation
Costs $1,000,000 $1,030,000
Revenues $1,100,000 $1,133,000
Pre-Tax Profits $100,000 $103,000
Tax (35%) $35,000 $36,050
Profit After Tax $65,000 $66,950
Dividend (50%) $32,500 $33,475
Dividend Increase 3%

Data from author’s calculations.

In reality, not all costs or prices rise exactly in line with inflation, but the general concept still holds.

Real growth: Of course, most companies wouldn’t be satisfied to just keep pace with inflation; they’re trying to grow their businesses in real terms, as well.

From: http://www.dailyfinance.com/2013/04/17/inflation-worries-fight-back-with-dividend-stocks/

5 Companies Set to Cash In on America's Aging Population

By Dan Caplinger

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Let’s face it: We’re getting old. The percentage of Americans age 65 or older has been steadily on the rise over the decade. It hit 14 percent in 2012 — and the Census Bureau projects that by 2050, 21 percent of Americans will be at least 65 years old.

Our aging demographic profile has created some immense challenges, particularly in the areas of Social Security and Medicare. But it also opens up opportunities for enterprising businesses that provide necessary services to an aging population.

Companies that identify demographic trends are best positioned to profit from them. Here are five that are in the right place at the right time — and if they’re smart about their strategic vision, they (and their investors) could reap a lot of growth from an aging customer base.

Motley Fool contributor Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool owns shares of Johnson & Johnson and Medtronic.

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Stocks of Ice and Fire: 'Game of Thrones' Investing Ideas

By Katrina Chan


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From King’s Landing to Winterfell to Qarth to The Wall to living rooms across the nation — the epic tale of the fight for the Iron Throne of Westeros continued with Sunday’s premiere of Season 3 of HBO‘s popular fantasy series “Game of Thrones.”

For fans of the show (or the George R.R. Martin “A Song of Ice and Fire” suite of novels the series is based on) the Lannister, Stark, Baratheon and Targaryen clans are practically family — dysfunctional, scheming, slaughtering family, but family just the same.

Their futures may be uncertain, but their fortunes (or whatever they leave to their heirs) needn’t be. Let’s imagine what stocks these characters would invest in if they were building a nest egg while trying to conquer Westeros.


Although this is probably obvious, none of the characters mentioned above actually own any of the stocks mentioned above because, well, they’re fictional characters. Katrina Chan does own shares of Apple and Berkshire Hathaway. You can follow her on Twitter @katrinachan. The Motley Fool recommends Apple, Berkshire Hathaway, Goldman Sachs, and LinkedIn. The Motley Fool owns shares of Apple, Berkshire Hathaway, and LinkedIn.

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Source: FULL ARTICLE at DailyFinance

Midday Report: UBS Releases List of 14 Favorite Stocks

By DailyFinance Staff

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Stocks have soared to record levels this year, but one brokerage firm says there are still plenty of profits left to mine.

After the market‘s stellar first-quarter gains, UBS (UBS) is out with a new list of favorite stocks. According to 24/7 Wall Street, UBS names 14 stocks for which it sets target prices at least 25 percent above current levels.

Some are household names like Citigroup (C) and Delta Air Lines (DAL), but there are a number of companies on the list that you may not be familiar with.

There are two energy-related stocks – Halliburton (HAL) and Cobalt International (CIE). Halliburton shares have already jumped 15 percent this year, but the UBS price target sees it gaining another 33 percent.

Robert Nickelsberg/Getty ImagesTwo employees of Halliburton Company moves between large pump trucks at a natural gas well site.

Delta is another one that has soared already this year, up 37 percent. It’s the only transport company to make the list.

There are a couple of others that have also had good runs already this year. Newcastle Investment (NCT), a real estate investment trust, is up 26 percent. And software maker Infoblox (BLOX) has gained 18 percent. It went public a year ago.

UBS also has a pair of drug and bio-pharmaceutical companies on the list. Warner Chilcott (WCRX) may be a bounce-back story. Its shares have lost 40 percent of their value since last May, and it recently warned that earnings this year are likely to fall short of Wall Street estimates. Alexion Pharmaceuticals (ALXN) is another against-the-grain pick. Last week it received a warning letter from the FDA, which said the company has failed to comply with good manufacturing practices.

Along the same line, UBS likes Monster Beverage (MNST), even though the company has been under fire recently because of possible links between its energy drinks and health problems.

Arch Coal (ACI) is the lowest priced stock on the list, trading just above $5 a share. The UBS target is $9. Like other coal companies, Arch has cut production at several mines because of weak demand for coal-based electricity. The stock has tumbled 29 percent so far this year.

Rounding out the list are Whole Foods (WFM), the retailer Ross Stores (ROST), TIBCO Software (TIBX), and Kraton Performance Polymers (KRA).


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5 Stocks That Have More Than Doubled in 2013

By Rick Aristotle Munarriz

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Ronda Churchill/Bloomberg News

The first quarter was a great one for investors. The tech-heavy Nasdaq rose by more than 8 percent, and the S&P 500 fared even better, soaring 10 percent.

Naturally, there are companies that performed better than that. In fact, a handful more than doubled over the past three months. Wondering which companies you’ll want to kick yourself for missing out on? Let’s go over a few of them.

Caesars Entertainment (CZR) — Up 129 percent

Wall Street‘s biggest winner was Caesars Entertainment, even though the casino operator isn’t exactly hitting the jackpot, financially speaking. Revenue declined in its latest quarter, and Caesars isn’t expected to turn a profit again until 2016 at the earliest.

So why are investors wagering on Caesars if it seems to be a bad bet fundamentally? Online gambling: Caesars is well positioned to cash in if revenue-hungry states free up restrictions on Internet-based gambling.

In the meantime, Caesars is investing in its properties, opening the Nobu Hotel and Restaurant at Caesars Palace in February and hoping to open the Linq entertainment district by the end of the year.

Consumer Portfolio Services (CPSS) — Up 118 percent

The market has rewarded risk-takers so far in 2013, and Consumer Portfolio Services is no stranger to risk.

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The specialty finance company buys retail installment sales contracts from auto dealerships that have a hard time lining up traditional financing for their customers. We’re talking about car buyers with crummy credit scores.

This is a risky business, but it’s paying off for the financier at a time when auto sales are booming and the economy is showing signs of life. Plus, Consumer Portfolio Services knows that the loans are secured by late-model used vehicles that can be reclaimed from deadbeat drivers.

Consumer Portfolio Services posted better-than-expected quarterly results in February. Revenue climbed by 11 percent, and adjusted earnings of $0.16 a share drove past the pros parked at $0.12 a share.

SunPower (SPWR) — Up 105 percent

There’s been a dark cloud over solar energy for investors lately, but even so, SunPower has been a shining star.

Unlike most solar firms, which are based out of China, SunPower is a sun-loving Californian. Many of its deals for solar panels and systems stem from homebuilders, schools, businesses, and utility companies in this country. SunPower is also profitable, at least on an adjusted basis. With oil and gas prices still too high for comfort, don’t be surprised if solar energy bounces back.

Netflix (NFLX) — Up 104 percent

No one’s laughing at the company behind the short-lived Qwikster fiasco these days. Netflix has been on fire since it bottomed out last summer, more than tripling in that time. A surge in streaming customers and a surprisingly …read more
Source: FULL ARTICLE at DailyFinance

5 Offensive and Defensive Funds to Strengthen Your Portfolio

By Dan Caplinger

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Richard Drew/AP

Investors are getting more excited about the stock market now that it has fully recovered from the financial crisis and started to set new record highs. But if you’re looking to invest now, you have to protect yourself from the possibility that the long bull market could reverse itself.

It’s always tough both financially and psychologically to recover from immediate losses on investments you just bought, so taking steps to avoid big losses is well worth the effort.

With that goal in mind, here are five exchange-traded funds that can strengthen your portfolio against the threat of a possible stockmarket decline while still giving you exposure to further gains if the bull market continues.

iShares MSCI USA Minimum Volatility (USMV)
This ETF seeks out stocks that tend to rise and fall more gently than the overall stock market. With a concentration on health-care stocks like Eli Lilly & Co. (LLY) and consumer-oriented stocks like cereal giant General Mills Inc. (GIS), the iShares ETF focuses on stocks with defensive characteristics that hold up well under any economic environment. That won’t keep the fund from losing money in a falling stock market, but it should help reduce the extent of your losses. And with low costs of just 0.15 percent annually, the ETF doesn’t charge a ton to give you that protection.

PowerShares S&P 500 Low Volatility (SPLV)
Like the iShares ETF above, this fund focuses on low-volatility stocks in defensive industries. But the mix of investments in the PowerShares ETF is different, as it concentrates largely on utility stocks, which make up more than 30 percent of the fund’s portfolio right now. Utility giants Southern Co. (SO) and Consolidated Edison Inc. (ED) provide strong dividend income, and their ability to rely on regulated income from millions of utility customers gives them security even when the economy starts to falter. The fund’s costs of 0.25 percent per year are a bit higher than the iShares ETF but are still reasonable for ETFs generally.

PowerShares S&P 500 BuyWrite (PBP)
At first glance, this ETF looks a lot like a typical index-tracking fund, owning Apple Inc. (AAPL), ExxonMobil Corp. (XOM), and many of the other big companies in the S&P 500. But the twist this ETF uses is to write covered call options against that stock, boosting income at the expense of giving up some of the upside in its stock holdings. During bull markets, that strategy underperforms the overall market, but it produces more favorable results when stocks decline. With expenses of 0.75 percent, the strategy is a bit pricey, but it’s still an interesting way to protect against the full impact of a downturn.

iShares S&P Preferred (PFF)
Stocks come in two flavors: common and preferred. …read more
Source: FULL ARTICLE at DailyFinance

The Greatest Business Rivalries of All Time

By CNNMoney

Burger King Vs McDonalds

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Cassandra Hubbart, DailyFinance

There was the time Thomas Edison electrocuted an elephant to demonstrate the danger of a competitor’s technology. The day that Nike (NKE), desperate for an advantage over a surging Reebok, signed a college hoops player named Michael Jordan. And the time the Central Pacific Railroad laid an astounding 10 miles of track in 24 hours to grab government payments that the hated Union Pacific would otherwise claim.

Rivalries make great stories, and the greatest rivalries make the greatest tales — reason enough to read the following portraits of brilliance, skullduggery, nobility, mendacity, victory, and failure. But if you’re the driven type who demands more practical benefits, you’ll find those here too. After all, monumental business battles have changed the world. We cannot imagine life without cellphones or the Internet, but if tiny MCI hadn’t challenged the titanic AT&T (T) (the No. 4 rivalry in our ranking), the communications revolution would have played out much differently. Steve Jobs and Bill Gates (No. 6) ended up selling few competing products yet contended for 35 years to impose radically different visions on the world of computing. And a global economy that couldn’t function without air travel is far faster and better because Airbus and Boeing (BA) (No. 9) have had to fight each other every day for 40 years.

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But powerful rivalries can be blinding, obscuring events beyond the combatants’ battlefield. Coke (KO) and Pepsi (PEP) (No. 1) were so busy pounding the daylights out of each other that they missed an entirely new notion, and today, inconceivably, the bestselling energy drink in U.S. convenience stores isn’t made by either company. (It’s Red Bull.) General Motors (GM) and Ford (F) obsessed over each other until one day Toyota (TM) had stolen the bulk of their profits.

What comes through most strongly in these stories is each conflict’s sheer human intensity. Only a brave novelist would have imagined the brother vs. brother saga of Adidas vs. Puma (No. 20). Venice vs. Genoa (No. 7) may look like a dusty tale of feuding city-states, but it set the tone for hundreds of years of European competition. The rivalry between the railroads was economic, ethnic, and spectacular, involving sabotage, deception, and death.

Who needs such lessons? Oh, right, you do. So think of these dramas as guilt-free pleasures. Then, well prepared for the task, go forth and pulverize your rivals.


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The 5 Best Companies in America: You Won't Know Most of Them

By The Motley Fool

Cummins - Bloomberg News/Tom Strickland

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There are dozens of ways to evaluate and measure the success of a company — from customer service to employee satisfaction to profits, payouts, peer rankings, and more.

From an investor’s perspective, however, the measures that traditionally receive the most acclaim are rapid earnings growth and a rising stock price.

Too bad this approach to analysis is severely flawed.

Had you based your investing decisions on rapid earnings growth and rising share prices, there would have been no question that Countrywide fit the bill to a T. The nation’s largest mortgage lender certainly delighted its shareholders with huge profits from 2003 to 2006. Alas, the company drove itself into bankruptcy by mistreating its employees, homeowners, and mortgage investors — three key stakeholders in its core business.

On a more mundane level, anyone who’s ever had to deal with a surly checkout clerk can tell you that failing to look after employees and customers can result in lost future business for a retailer.

Of, For, and By the People

A lot of people are involved in a company’s success — or failure. As professor Ed Freeman of the Darden School of Business at the University of Virginia puts it, “Business is about how customers, suppliers, employees, financiers, communities, and managers interact and create value.” Several studies suggest that companies that focus on multiple stakeholders tend to achieve better financial performance over the long term.

So which companies have got the mix right? Which ones are able to benefit all stakeholders?

The Best Company in America Is … What?

For the past several months The Motley Fool has been compiling data and analyzing more than 1,700 public companies to discover the 25 best public companies in America, measured by their success in serving investors, customers, employees, and the world at large.

Some of the names will be familiar to you. Costco earns a spot, as does Aflac, Intel, Whole Foods, Coach, and Starbucks. But there are many you may not have heard of — and as an investor, that’s a shame.

Here are the five that rose to the top of the list. You can get more details on how we made the rankings, and link out to the entire top 25 list from the last slide in our gallery.


The Motley Fool recommends Apple, Cisco Systems, Cummins, and Teradata. The Motley Fool owns shares of Apple, Cummins, General Electric Company, and Northrop Grumman. Try any of our newsletter services free for 30 days.

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'Desperate Housewives' Rachel Fox Whomps the Market As a Day Trader

By Caroline Bennett

NEW YORK - APRIL 25:  Actress Rachel Fox from the film

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Rachel Fox played Kayla Scavo, Felicity Huffman‘s scary stepdaughter, on “Desperate Housewives.” Five years later, at the ripe old age of 16, she has finally come clean about her addiction … to investing.

The stock market has become a favorite hobby for Fox, so much so that she has started a blog — the catchy “Fox on Stocks” — where she dishes investing advice, lessons on using stop-limit orders, and specific stock picks (both long and short).

So far, she’s achieved results many pros would envy: Fox’s returns have beaten the S&P 500 — she allegedly made a 30.4 percent gain last year, compared to the S&P’s 13 percent.

Is it just dumb luck, or does this teenager know something that you don’t?

Play Money Then, Real Money Now

Fox credits her mother for first sparking her stock market passion. She taught her to invest using play money as a child. Now she’s investing with real money, which means real, tangible gains and losses. Even at a young age, she’s not without her share of Wall Street horror stories.

Fox’s worst stock buy, she says, was made on the advice of a family friend at a Thanksgiving dinner. The $2 stock was apparently destined to hit $10, but instead dwindled into a penny stock.

A much better result came when she shorted iconic jeweler Tiffany (TIF) immediately before the company’s disappointing Jan. 10 earnings call, after which the stock dropped from $63.12 to $59.49. She knew the stock was going to dip, she says, because she was paying attention to the company’s financial expectations.

Turns out Tiffany had lowered its outlook before it released earnings. By acting at exactly the right moment, Fox was able to swoop in and gobble up some sweet returns as a result.

High Risk, High Rewards

Clearly, this is one teenager who does her homework. Every day, Fox pores over the financial news sites and annual reports. Like her idol, Warren Buffett, she says she ignores the sensational white noise of day-to-day news feeds.

She has also given a lot of thought to what her individual investing strategy is. And while she has been successful so far, that doesn’t mean her strategy is right for other investors. In short, Fox likes to day-trade. After all, she can afford to take risks; she is a young, successful actress who likely has little in the way of debt right now.

Last year, Fox made a remarkable 338 trades. Not only would the fees (and potential taxes) associated with this high number of transactions hurt an investor’s overall returns, but the risks involved could easily exceed the tolerance of an average investor, burdened by student loans, bills, and a mortgage or rent payments.

On her blog, Fox is candid about the dangers inherent in …read more
Source: FULL ARTICLE at DailyFinance

Investing Hints From the Newest Forbes Billionaires

By Bruce Watson

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When it comes to getting rich, the best textbook may be Forbes’ list of the world’s billionaires. After all, who better to show the right steps to financial freedom than the men (and, increasingly, women) who have already gotten there? And, with a new list fresh off the presses, what better time could there be to reap their wisdom?

Looking at the list, one of the first lessons is that the shortest path to wealth goes through the delivery room. Whether you’re talking about the Waltons or the Kochs, the Bulgari brothers or the Mars mob, it’s clear that things go a lot easier if you can start off with a few million from mom and dad. Heck, even for famed self-made mogul Bill Gates and newcomer fashion maven Tory Burch, it didn’t hurt to come from a rich family.

Those looking for guidance from the Forbes list will quickly realize, however, that it generally shows where the most profitable places in the world were, not where they will be. With the benefit of a few decades of hindsight, it seems obvious that telecom, personal computers and low-cost retailing were smart places to put your money. But when Carlos Slim, Michael Dell and Sam Walton were starting out, their business plans may have seemed insane.

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But that doesn’t mean that you can’t pick up some valuable lessons from the list. If you’re looking for places to invest your savings, a good place to start is with the newest members of the billionaires club. After all, these are the people who have most recently latched onto a new economic opportunity, a new business model, or a new market segment. In other words, they’re the ones who have the best ideas at where the market may be heading.

Unless, of course, they’re the Bulgari brothers, in which case, they’re just damned lucky.

At any rate, here are some lessons you can glean from the latest list:


There has always been a lot of money in fashion, but in the last year, improved distribution, smart marketing, and increased consolidation have mixed to put some of the biggest names in fashion onto the billionaires list. For example, Renzo Rosso, the creator of Diesel jeans, made the list this year after snapping up a passel of other brands, including Maison Martin Margiela and Viktor & Rolf. Other European brand names that managed to make the list include Paolo and Nicola Bulgari, Domenico Dolce and Stefano Gabbana and French Cosmetics scion Bris Rocher.

A little closer to home, American designer Tory Burch also joined the list, making her America’s second-youngest self-made female billionaire. Spanx inventor Sara Blakely beat her by five years.

Mid-Level Retailers

It’s no secret that bargain retail companies like Walmart, Target and Dollar …read more
Source: FULL ARTICLE at DailyFinance

Dividend Stocks: The Best Raises You'll Never Earn

By Chuck Saletta

General Electric

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If you’re like most of us, it has been far too long since you’ve seen a decent raise. In 2012, wages and salaries increased 1.7 percent on average, barely keeping up with inflation. Behind that slow wage growth is the unfortunate fact that unemployment remains stubbornly high — and has been stuck there for years. With so many people looking for the available jobs, competition for work is high, keeping wages down.

But even with high unemployment and stagnant wages, companies are still making money — and that money has to go somewhere.

In many cases, where it goes is straight into the hands of shareholders, in the form of dividends.

Go Where Raises Are Plentiful

While salaries have been stagnating, dividends have not.

According to S&P Dow Jones Indices, dividends increased by 18 percent in 2012. That’s a whopping 10 times the rate of salary increases — and it is some incredible money, if you can get it.

Fortunately, you can get your hands on some of that money — and the potential raises that come with it. All you need to do is transform yourself from an employee into an owner by becoming a shareholder of a company that pays, has raised, and has the potential to continue raising its dividends.

Invest in Future Raises

In today’s era of ultra-cheap commissions and brokers with low minimum starting balances, it’s incredibly easy to buy shares in companies that pay out dividends.

Better yet, once you’ve made yourself a shareholder of a company that pays dividends, you don’t have to do a thing to get those raises. It’s all the rewards of ownership. And for most people, these dividend payouts also come with the added benefit of lower taxes, as well.

As unearned income, dividends are not subject to Social Security tax, and unless you’re making enough to get caught by the new Medicare surtax, they’re not generally subject to Medicare taxes, either. Plus, in most cases, dividends are taxed at lower regular tax rates than earned income, as well.

Put it all together and, in a nutshell, it means that you can get faster raises and lower taxes with virtually no effort at all on your part, other than what it takes to save up enough to buy some stock.

That’s what makes dividend increases the best raises you’ll never earn — you can get them without having to earn them.

What’s the Catch?

Of course, like everything else in investing, there are risks attached.

Dividends are not guaranteed, and companies that fall on hard times can slash their payments. Even General Electric (GE), one of the largest companies around, was forced to cut its dividend in 2009 due to the financial meltdown and its own part in the subprime mortgage mess.

In fact, if a company …read more
Source: FULL ARTICLE at DailyFinance

Web Startup Targets DIY Investors Who Think They Can Spot a Trend

By The Associated Press

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By Mark Jewell

BOSTON – Think you can tell the difference between a fad and a trend with staying power? Look around, and you might come up with some decent investing ideas.

If you’ve noticed that lots of your friends are using tablet computers instead of PCs, it might be a good time to consider stocks of companies driving the tablet revolution.

See evidence that Americans are getting more serious about their weight problems? Consider stocks of fitness center chains and weight-loss clinics. If you’re convinced that we’ll never get disciplined about our diets, try the opposite approach and invest in fast-food chains.

For average investors hoping to beat the market, buying several stocks fitting a broad investment theme is probably a better option than assessing which individual companies to buy. Few have the know-how to routinely make good stock picks, let alone the patience to do the required research.

With those realities in mind, a Silicon Valley startup last year launched a website aimed at do-it-yourself investors who consider themselves savvy trendspotters. Motif Investing enables customers to buy baskets of up to 30 stocks each that fit various “motifs,” as the company calls them.

The bigger player a company is in that investing theme, the larger its weighting is in the basket of stocks. For example, Wal-Mart makes up nearly one-quarter of the portfolio in a retail stock motif called “Discount Nation.”

The website has a menu of more than 100 motifs. Some are fairly conventional, such as offerings focusing on dividend-paying stocks and diversified bond portfolios.

But most are trend-oriented, such as a “Tablet Takeover” motif geared toward tablet computing, a “Fighting Fat” basket of weight loss-themed stocks and a “Junk Food” motif of fast-food and soft drink stocks. If social change is important to you, a “No Glass Ceilings” motif owns stocks of corporations run by female executives. Another invests in companies with gay-friendly workplace policies.


Motif launched last June, and on Thursday announced a new feature enabling individuals to create custom motifs and share them with other customers. Eventually, Motif plans to adopt a royalty system, allowing someone creating a motif to earn small payments when other investors buy it.

Customers can post investing ideas online for all to see, or friends or colleagues can exchange tips privately.


Motif is among a small number of young companies trying to challenge traditional investment advisory firms through novel uses of the Internet and social networking. Others include Covestor, MarketRiders, Wealthfront, ShareBuilder and Betterment.

Although none has become a significant player in the industry, some could eventually catch on with certain types of investors.

“There’s room for these niche players if they can get some traction,” says analyst David Schehr of research firm Gartner Inc.

Motif’s likely target audience, Schehr says, is investing enthusiasts …read more
Source: FULL ARTICLE at DailyFinance

5 Foreign Stocks You Can Snap Up at Bargain-Basement Prices

By Dan Caplinger

Kristian Helgesen/Bloomberg via Getty Images

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(Bloomberg / Getty Images)

Many of us find the prospect of investing in international stocks scary. With all the news lately about Europe‘s financial crisis and a big slowdown in emerging-market economies like China, that fear may seem justified.

But when an entire country’s stock market gets crushed due to wider economic concerns, some promising stocks get unfairly punished.

Here are five foreign companies whose shares are trading now at attractive prices, along with explanations for why they’re such bargains, and what their future prospects are.


You can follow Motley Fool contributor Dan Caplinger on Twitter @DanCaplinger or on Google+. He has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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Apple's Scary Stock Ride: Why the 'Jockey' Really Matters

By Chuck Saletta

Apple stock

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Apple (AAPL) has been one of the most innovative companies in the world. Its iPod and iTunes changed the way we listen to music. The iPhone made phones incredibly useful for things other than basic calling and texting. And the iPad pulled off the incredible feat of making mobile computing both cool and ultra-portable.

Not only has it revolutionized many parts of our daily lives, it has done so while generally charging premium prices for the products it sells. Darn near every other company on the planet would love to have its track record.

Still, in spite of Apple’s incredible run, its shares have been faring rather badly lately.

So what’s with its stock?

Since reaching a high-water mark of $705.07 last September, Apples shares have shed about 36 percent of their value, falling to $450.81 as of last Friday’s close. That’s a sharp retreat from the days when it held the title of “Most Valuable Company in History.”

The key issue with Apple’s stock today isn’t the company’s history or reputation — it’s the future.

As Walter Isaacson pointed out in his biography Steve Jobs, the company owes much of its success to the creative genius and exacting standards of Jobs, its founder and longtime CEO. And unfortunately, Jobs is no longer with us.

His death, of course, is old news. But what’s is relatively new is that the products in Apple’s pipeline are infused with far less of Jobs’ direct creative genius. And that has investors worried, especially as the company has recently missed expectations.

At today’s market price, Apple is trading as if it has plateaued — with few prospects for future growth.

Bet on the Jockey or the Horse?

Apple’s dependency on Jobs for its creative spark made its stock something of a “jockey play” for investors — a company that was worth owning because of who was leading it. Jockey plays can make fine investments, but as shareholders in the Jobs-less Apple are finding out, the market can be unforgiving when that jockey is no longer holding the corporate reins.

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Given its strong, debt-free balance sheet with around $40 billion in cash on hand, solid suite of current products, and a still reasonable pipeline, Apple is not in any real risk of going belly-up anytime soon. But the legitimate question investors are asking is whether the company has what it takes to continue to wow consumers again with more must-have products like the ones that fueled its ascent.

As Isaacson pointed out in his biography, bringing that creative genius to life in products was tough enough for a passionate founder/CEO like Jobs. Without his special magic, it may well be impossible. Apple certainly isn’t dying, but the market is now valuing it like a maturing, virtually-no-growth company — which it may well …read more
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Are Hollywood Stocks the New Tech Stocks?

By Tim Beyers

Comic Con

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It’s an event so exclusive that only a fraction of the hundreds of thousands who tried to get in actually made it? No, it’s not the Oscars. Nor Fashion Week. Nor the Super Bowl.

No, I’m talking about Comic-Con — the annual pop culture event that started out as a small gathering of comic book writers, artists, and collectors in the 1970s.

This year’s confab, to be held July 18-21 in San Diego, could draw at least 130,000 fans in addition to innumerable celebrities, Hollywood executives, and…

Are Hollywood Stocks the New Tech Stocks? originally appeared on DailyFinance.com on 2013-02-21T15:20:00Z.

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Source: FULL ARTICLE at DailyFinance

5 Ways to Prevent Panic From Plundering Your Portfolio

By Dan Caplinger

Panic stocks investments

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With the stock market near its all-time high, few investors are terribly worried about their portfolios right now. But that makes now the best time to take steps to panic-proof your portfolio in preparation for the next financial crisis to rear its ugly head — whenever that may happen.

Once panic sets in, it’s incredibly difficult to make smart investment decisions — and that’s when people make costly mistakes with their portfolios. Here are five things you can start doing now that should help keep the panic at bay the next time stocks take a stomach-churning plunge.

1. Make Sure You Have Cash for a Rainy Day — and a Fire Sale

In tough times, having an emergency fund to help you meet unexpected financial challenges is essential. The usual target is a cushion large enough to cover living expenses for three to six months. But having more cash on hand not only gives you more peace of mind, it also gives you a chance to take advantage of investment opportunities if more attractive conditions arise.

2. Rebalance Your Portfolio

The key to matching up your investments with your appetite for risk is to use an asset allocation strategy that guides you on how much of your money you should have in different types of stocks, bonds, funds, and other investments. Over time, as different investments earn different returns, the actual percentages of each you have in your portfolio can change dramatically. Rebalancing takes some of the profits on from past winners and reallocates them, pulling your portfolio proportions back into line and keeping your risk level where you want it. That will help you to take any future declines in stride.

3. Lighten Up on Big Bets

Making a smart call on a particular sector can earn you huge profits. For instance, after struggling for years, U.S. solar stocks First Solar (FSLR) and SunPower (SPWR) hit bottom last year, and lately, they’ve both made big runs higher as solar power gets cheaper and more widespread as an alternative energy source. But if you’ve managed to double or triple your money in these stocks, trimming back on your positions will ensure that you hang on to at least some of those profits. Moreover, in a pullback, you may well end up being able to buy back those shares more cheaply. And either way, the move will free up cash that you can use to invest in new stock prospects either now or down the road.

4. Find Safer Stocks

Getting out of the stock market entirely at the first whiff of danger isn’t a viable long-term investing strategy. But what you can do is look at stocks that tend to behave better during downturns. For instance, during the 2008 stockmarket crash, fast-food stalwart McDonald’s (MCD) actually saw …read more
Source: FULL ARTICLE at DailyFinance

Give Up These 3 Vices for Lent, but Keep Them in Your Portfolio

By Caroline Bennett

Lent Vices Portfolio

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It’s that time of the year again — the first days of Lent, when Catholics, and many Protestants as well, challenge themselves to forgo for 40 days a food, activity or product they love. The sorts of things “given up for Lent” tend to resemble the usual subjects of New Year‘s resolutions — like smoking and soda consumption — but recently even the use of social media has become fodder for 40 days of self-denial.

However, just because overindulging in such things is considered bad for you…

Give Up These 3 Vices for Lent, but Keep Them in Your Portfolio originally appeared on DailyFinance.com on 2013-02-20T05:00:00Z.

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