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"Economy Moves to Fore as Issue for 2008 Voters"
(Headline, page A1, Tuesday, Wall Street Journal--12/4/07)
Part 2: Coca Cola, et al
Classic Portfolio
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Comments
Chart looks busy
but it's not. There are only four stocks here. They are the current top four ranked stocks in the Classic Portfolio which hold 36 'blue chip', 'good value' stocks. The top group of curves are a simplified version of weekly stock prices. They are proportionate to each other. The prices don't matter. All we want to notice here is their trend. It is up for all. The percent prices changes over the 20 weeks shown appear in the legend box to the right.
The lower group of curves shows the ranking progress for each stock. All appear solidly in the top half of the possible rank range from 1 (the best) down to 36 (the weakest). Two have already just entered the chart above the median rank. The other two burst through median shortly after the chart begins. These top four consumer growth stocks show splendid strength, +15% on average in the current miserable market with the S&P500, for example,
-3.5%, Russell 2000 -8.2%, and Nasdaq 100 +2.6%.
What bear market? Annualized, these four stocks' returns average 42%. The bad news is that when they start to populate the STRONGEST STOCKS/This Week's Best page, it means a serious bear market is well under way. This has not happened yet, but an indication to be chary of. Does that mean you should not trade these this portfolio or these stocks? Not at all. We tend to lump stocks together and treat them as a lump--and get lump results. One of the more ancient adages on Wall Street is: It's not a stock market. It's a market of stocks.
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Part 1: Citigroup, et a,l here
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