Stock Market: That Was The Year That Was
Hey, Stock Market, Wa’ssup 2012?
New York Stock Exchange (January 2, 2012) – Occupy Wall Street aside, the Standard & Poor’s 500 Index did not appreciate in value (-0.003% to 1257.60) during 2011. The DJIA finished the year at 12217.59. The Euro Stoxx 600 dropped more than 11% closing at 244.54.
Why you ask? Why did my portfolio gain double-digits?
How can we do better? This is the best question.
Last Saturday-Sunday’s Wall Street Journal (WSJ) suggests that a team of advisors and specialists be formed for each investor. Teddy & I take our information from multiple sources, which include eliciting valid data from non-professionals that work at the corner market (@countrycornerca) located in northern Silicon Valley. Some media sources are often wrong (knowing that helps us make better decisions).
Joe Queenan points out in the WSJ that Americans often got too high last year over news reports of unemployment rates, new product releases, congressional (in)action, corporate profit margins, military successes, labor strikes and lockouts, and fashionable fads. Joe writes, “I am no Pollyanna: I realize that tough times may still lie ahead… I for one am tired of being told not to get my hopes up every time it likes like there is something to get my hopes up about.”
Hedge funds lost, on the average, 5% last year. A couple funds increased double-digits like mine. Bridgewater Associates’ $120 billion hedge rose 25% in ’11 and James Simon’s $17 billion Renaissance Technologies Institutional Equities fund rose 35% just last year.
Within Teddy’s Biotech-Healthcare-Pharmaceutical Portfolio, Amgen hit a new high of $65/share, Bio Marin ended the year at $34.38/share, Gilead finished at $40.93/share, Perrigo went up over 50% to $97.30/share, Valeant Pharmaceuticals boomed 65% to $46.69/share, Regen Pharmaceutical rose over 60% up to $55.43/share, HealthSpring rocketed over 105% up to $54.54/share, and Elan Pharmaceutical gained over 100% and landed at $13.74/share.
Several non-biotech stocks within our watch-list also outperformed the market. Exxon-Mobil finished up nearly 16% to $84.76/share, KLA-Tencor gained 24% to $48.25/share, Lululemon split 2 for 1, Dollar Tree rose 48% to $83.11/share, Dollar General Stores increased 34% to $41.14/share, CBS gained 42% and ended the year at $27.14/share, and REIT Essex Properties went up 23% and landed at $140.51/share on 12-31-2011.
Many companies suffered far worse than MCD. McDonald’s Hamburger Corporation stock price went up 31% to over $100 per share.
GOLD – After hitting an all-time record at $1,888.70 per ounce in August, this metal ended up 10% for ’11 at $1,565.80.
Did you know this?
- Kentucky’s governor rejected a three-way that would have merged into KY’s biggest hospital system?
- Federal courts suspended the U.S. EPA’s effort to regulate power plant air and water pollution?
- U.S. home prices fell 1.2% in just one month – between last September and October.
- Iran publicized that it will launch missiles and torpedoes as part of a continuing naval drill in the Persian Gulf?
- Unemployment rate formulas do not account for millions. There are at least 54 million Americans with disabilities; that unemployment rate is 46%. Former workers whose unemployment benefits have run out are also not counted in the national unemployment rate figures. Go figure!
- Millions of Americans will have to show photo IDs at election polls?
- China is in the mist of a program to build 36 million subsidized homes by 2015? That is enough for the entire population of East and West Germany!
- U.S. retail sales rose 3.8% from a year ago. This does not take into account all the returns after Thanksgiving and Christmas!
- Natural gas prices fell to the lowest level in more than two years? It is now valued at $2.989 per million BTUs. Imagine this price during the winter!
With all this negative news, how in the world are we supposed to feel hopeful about national and personal finances in 2012?
Back to Karen Blumenthal’s 12-31-11 WSJ article… She writes that in 2012 investors should have three other members on each person’s team:
- Financial Advisor
I believe her’s is a short list. We need smart fellow investors, good financial news sources, cooperative spouses, and capital. Yep capital, you have to have money to make money. So give me the good wife, a friendly banker, my friends who stay current with market trends, and a slew of resources with TV, Internet, and print media.
How can we do better? Be more diversified. Take more risk and “hedge your bets.” Verify someone’s data. Ask others for a “second opinion.”
Don’t ask guys, who when asked, “Would you like a second opinion?” Respond with a line like, “I don’t need a second opinion, I already have one!”
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– Max’s Scout Services & Communications, LLC –
[ for musement only ]