7/01 letter
*** market
Pretty much a flat week. (SP500 = 1200)
*** portfolio (since 12/1/2004 baseline)
My Portfolio: +7.1%
SP500: +0.7%
Mid-cap: +7.5%
Small-cap: +1.3%
*** comment
My portfolio is performing pretty well, thanks to a uniform rise plus the blockbuster CME.
CME (Chicago Merc Exch) rose from $250 to $300 this week on the news it is merging CBOT into its fold. This stock was traded at $170 in March, and now is $300. It boasts the same gain as Google. And CME's PE ratio is half of Google. What the hack, Google?
Well, the morale is that when an enterprise has "high moat" in Buffett's language, it will continue to find ways to grow and investors are happy to put money to its use. If you are influenced by analyst forecast, like $260 is top, you are topped out (long time ago). Sorry... It is a test to your faith.
Speaking of faith to a high-moat enterprise, I added some position in LSTR last week, when it hit 25% stop. The price soon recovered and wiped out a lot of trader positions. Again, 25% stop is questionable. LSTR is a truck load company (not a big deal!). But it has a scalable business model. In May, it is added to Dow Transportation index. This is a proof of its strength. But you should not think that it won't stop you out on a technical basis, especially on top of this publicly known good news. Strange, right?
Have a nice July,4th...
Steve
Pretty much a flat week. (SP500 = 1200)
*** portfolio (since 12/1/2004 baseline)
My Portfolio: +7.1%
SP500: +0.7%
Mid-cap: +7.5%
Small-cap: +1.3%
*** comment
My portfolio is performing pretty well, thanks to a uniform rise plus the blockbuster CME.
CME (Chicago Merc Exch) rose from $250 to $300 this week on the news it is merging CBOT into its fold. This stock was traded at $170 in March, and now is $300. It boasts the same gain as Google. And CME's PE ratio is half of Google. What the hack, Google?
Well, the morale is that when an enterprise has "high moat" in Buffett's language, it will continue to find ways to grow and investors are happy to put money to its use. If you are influenced by analyst forecast, like $260 is top, you are topped out (long time ago). Sorry... It is a test to your faith.
Speaking of faith to a high-moat enterprise, I added some position in LSTR last week, when it hit 25% stop. The price soon recovered and wiped out a lot of trader positions. Again, 25% stop is questionable. LSTR is a truck load company (not a big deal!). But it has a scalable business model. In May, it is added to Dow Transportation index. This is a proof of its strength. But you should not think that it won't stop you out on a technical basis, especially on top of this publicly known good news. Strange, right?
Have a nice July,4th...
Steve
posted by Steve at 11:57 AM
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