Outside of the revitalized energy patch, no corner of the U.S. economy is hotter than Silicon Valley.​ Google (Nasdaq: GOOG), the region’s bellwhether, has tacked on a 50% gain over the past 12 months, adding more than $100 billion its market value. #-ad_banner-# And moving far down the tech food chain, the hottest young tech companies are also creating great wealth for their employees and shareholders: Recent IPOs RocketFuel (Nasdaq: FUEL) and FireEye (Nasdaq: FEYE) have more than doubled since their IPOs last month. These companies are boosting sales at a really fast pace, but they’ve… Read More

Outside of the revitalized energy patch, no corner of the U.S. economy is hotter than Silicon Valley.​ Google (Nasdaq: GOOG), the region’s bellwhether, has tacked on a 50% gain over the past 12 months, adding more than $100 billion its market value. #-ad_banner-# And moving far down the tech food chain, the hottest young tech companies are also creating great wealth for their employees and shareholders: Recent IPOs RocketFuel (Nasdaq: FUEL) and FireEye (Nasdaq: FEYE) have more than doubled since their IPOs last month. These companies are boosting sales at a really fast pace, but they’ve also quickly become richly valued. For instance, FireEye is valued at $4.7 billion but is expected to have just $230 million in sales in 2014. On the other end of the tech investing spectrum are some deep value plays. But in cases like IBM (NYSE: IBM), growth will be so limited that they are really more like value traps. Simply put, in the world of tech, you can have growth or value, but not both.  But a few companies stand out for a reasonable measure of both growth and value. Each company is in the midst of… Read More

Allow me to let you in on a closely guarded secret among professional money managers. While they all talk a big game and make it appear that by investing with them you are close to being guaranteed market-beating returns, the truth of the matter is far different.#-ad_banner-# In fact, in the aggregate, the majority even fail to beat the market. Add in the fees, costs and expenses of investing with the professionals, and it seems like a losing proposition. I know this sounds sacrilegious, but the numbers speak for themselves. According to the finance blog Zero Hedge, nearly 90% of… Read More

Allow me to let you in on a closely guarded secret among professional money managers. While they all talk a big game and make it appear that by investing with them you are close to being guaranteed market-beating returns, the truth of the matter is far different.#-ad_banner-# In fact, in the aggregate, the majority even fail to beat the market. Add in the fees, costs and expenses of investing with the professionals, and it seems like a losing proposition. I know this sounds sacrilegious, but the numbers speak for themselves. According to the finance blog Zero Hedge, nearly 90% of all hedge funds, 65% of large-cap core funds, 80% of large-cap value funds and 65% of small-cap mutual funds underperformed the market in 2012.  These facts raise the question: Why do investors continue to pour money into professionally managed funds when the majority fail to deliver even market-beating returns?  Well, the answer is that a few funds deliver outsize returns year after year. This outperformance by the minority keeps the attraction high for the professional money management business. Investors scramble to find the next hot manager and funds on an ongoing basis, which keeps the cash flowing into the pockets… Read More

Goldilocks is famous for being very particular about her porridge. It couldn’t be too hot or too cold. It had to be just right. #-ad_banner-# That reminds me of mid-cap stocks: Not too big, but not too small — just the right mix of growth and stability. Unlike small caps, mid-caps are multi-billion-dollar companies and sometimes even market leaders. That provides these companies with a nice touch of stability that small caps with values dipping below $1 billion usually don’t offer. But unlike global mega-caps such as Exxon Mobil (NYSE: XOM) and Microsoft (Nasdaq: MSFT) worth hundreds of billions and… Read More

Goldilocks is famous for being very particular about her porridge. It couldn’t be too hot or too cold. It had to be just right. #-ad_banner-# That reminds me of mid-cap stocks: Not too big, but not too small — just the right mix of growth and stability. Unlike small caps, mid-caps are multi-billion-dollar companies and sometimes even market leaders. That provides these companies with a nice touch of stability that small caps with values dipping below $1 billion usually don’t offer. But unlike global mega-caps such as Exxon Mobil (NYSE: XOM) and Microsoft (Nasdaq: MSFT) worth hundreds of billions and long past peak growth, mid-caps valued between $2 billion and $10 billion still have the ability to grow many times over in the long run. These unique qualities have made mid-caps popular with investors looking for a balance between growth and stability. They have also produced market-crushing gains. In the past 12 years, the iShares Core S&P Mid-Cap ETF (NYSE: IJH) is up 223% against the S&P 500 Index’s 62% return. Take a look at the big gain below. But if you missed out on those gains, don’t worry. The third-quarter earnings season has revealed a… Read More

I love taking road trips. My friends think I’m crazy to prefer driving over flying, but I truly do. I like exploring little-known attractions and towns off the beaten path.  One of my favorite things about taking road trips is the wide variety of fast-food choices across… Read More

I don’t care what the bearish pundits are saying about the U.S. economy. While I don’t hesitate to turn bearish if the data bolster that view, I have learned to tune out the unsupported fear-mongering, political posturing and cherry picked-data of the prophets of doom.#-ad_banner-#​ Not only are these agenda-driven observers wrong most of the time, they rarely change their bearish tune. This means that when we actually enter a bear market, the bearish prognosticators claim victory. However, just like a stuck clock that’s right twice a day, the reality of their consistent errors is usually apparent. Clearly,… Read More

I don’t care what the bearish pundits are saying about the U.S. economy. While I don’t hesitate to turn bearish if the data bolster that view, I have learned to tune out the unsupported fear-mongering, political posturing and cherry picked-data of the prophets of doom.#-ad_banner-#​ Not only are these agenda-driven observers wrong most of the time, they rarely change their bearish tune. This means that when we actually enter a bear market, the bearish prognosticators claim victory. However, just like a stuck clock that’s right twice a day, the reality of their consistent errors is usually apparent. Clearly, the current super-bull market is one of global impact. I think the auto sector is undoubtedly supportive of my current ultra-bullish stance. Global auto sales have soared this year on the strength of the continued U.S. economic recovery. Virtually all the major automakers surpassed analysts’ earnings estimates in the second quarter, and 70% came out ahead of revenue estimates. Earnings climbed just over 14% and revenues pushed ahead by nearly 5% year over year. In the United States, auto sales hit a five-year high last year, rising 13% to 14.5 million vehicles. In August of this year, auto sales jumped… Read More

When you think of stalwart mega-cap industrial stocks, Caterpillar (NYSE: CAT) certainly is one that comes to mind. The earth-moving equipment blue chip, Dow component, and long-time bellwether for the global economy, has been a big winner for investors and traders over the years, and for good reason. During the past decade, there’s been a huge infrastructure buildup in the emerging markets of Asia, especially China, and Russia, India and Brazil. The massive demand for heavy-duty construction equipment has made the iconic brand a mainstay on big building projects in nearly every corner of the… Read More

When you think of stalwart mega-cap industrial stocks, Caterpillar (NYSE: CAT) certainly is one that comes to mind. The earth-moving equipment blue chip, Dow component, and long-time bellwether for the global economy, has been a big winner for investors and traders over the years, and for good reason. During the past decade, there’s been a huge infrastructure buildup in the emerging markets of Asia, especially China, and Russia, India and Brazil. The massive demand for heavy-duty construction equipment has made the iconic brand a mainstay on big building projects in nearly every corner of the globe. Recently, however, demand for Caterpillar’s products has waned, and that’s caused a marked slowdown in the company’s earnings growth, as well as a significant decline in CAT shares. On the earnings front, the company recently released results for the third quarter, and they were anything but impressive. Third-quarter earnings sank 44% year over year, missing consensus estimates by a wide margin. The company reported earnings per share (EPS) of $1.45, down from $2.54 in the same quarter last year. Revenue disappointed as well, coming in at $13.4 billion, down from $16.5 billion in the same quarter a year ago. Read More

I couldn’t believe my good fortune. It was my first day investing with real money at a proprietary trading firm. I had just completed an intensive training course and spent weeks on a stock market simulator with pretend money.#-ad_banner-# A quick primer: Proprietary trading companies hire traders to trade the firm’s money for a split of the profits. Some require traders to post a risk deposit to cover any potential losses. Others don’t require a deposit, but traders take less of the profit because the firm assumes more risk. My first trade was on a small $7 stock that showed… Read More

I couldn’t believe my good fortune. It was my first day investing with real money at a proprietary trading firm. I had just completed an intensive training course and spent weeks on a stock market simulator with pretend money.#-ad_banner-# A quick primer: Proprietary trading companies hire traders to trade the firm’s money for a split of the profits. Some require traders to post a risk deposit to cover any potential losses. Others don’t require a deposit, but traders take less of the profit because the firm assumes more risk. My first trade was on a small $7 stock that showed all the signs of one about to explode on the upside. I purchased the maximum number of shares that the firm permitted and set my stop loss — and to my amazement, the price took off to the upside. By the end of the trading day, I had banked a $2,500 profit after splitting with the firm. Not bad for the first day on the job, I thought. My phone rang — it was the managing director of the firm requesting my immediate presence in his office. I hadn’t met him, but I thought that surely he wanted to congratulate… Read More

Intel (Nasdaq: INTC) beat the Street’s estimates when it announced its third-quarter results last week. The company reported earnings of $0.58 a share, beating the consensus estimate of $0.53. Revenue for the quarter was $13.5 billion, in line with analysts’ expectations.#-ad_banner-#​ Intel also said it expects fourth-quarter revenue of about $13.7 billion, compared with analysts’ expectations of $14 billion.  Intel CEO Brian Krzanich was upbeat about the company’s third-quarter performance and strategy execution: “We’re executing on our strategy to offer an increasingly broad and diverse product portfolio that spans key growth segments, operating systems and form factors. Since August we… Read More

Intel (Nasdaq: INTC) beat the Street’s estimates when it announced its third-quarter results last week. The company reported earnings of $0.58 a share, beating the consensus estimate of $0.53. Revenue for the quarter was $13.5 billion, in line with analysts’ expectations.#-ad_banner-#​ Intel also said it expects fourth-quarter revenue of about $13.7 billion, compared with analysts’ expectations of $14 billion.  Intel CEO Brian Krzanich was upbeat about the company’s third-quarter performance and strategy execution: “We’re executing on our strategy to offer an increasingly broad and diverse product portfolio that spans key growth segments, operating systems and form factors. Since August we have introduced more than 40 new products for market segments from the Internet of Things to data centers, with an increasing focus on ultra-mobile devices and two-in-one systems.”  Intel is ramping up investments in its TV service project, hiring talent from the likes of Google (Nasdaq: GOOG), Apple (Nasdaq: AAPL) and Netflix (Nasdaq: NFLX) earlier this year. Whether all of this will play out as planned remains to be seen, but from a technical perspective, the stock’s chart looks enticing. The day after the company reported its earnings, the stock rallied 1.3% as investors and traders alike seemed to take… Read More

Biotechnology is a notorious minefield for investors. For every successful drug that survives the approval process, dozens more simply flame out. Millions of dollars of capital evaporate every time a clinical trial fails to produce positive results. #-ad_banner-# Yet a select group of biotech visionaries manage to strike it big — time and again. They have a knack for spotting biotechnologies that ultimately prove their mettle through the Food and Drug Administration’s rigorous process. And few have shown the gift of biotech insights like Randal J. Kirk. Kirk has built his fortune by focusing on drugs that have blockbuster potential. Read More

Biotechnology is a notorious minefield for investors. For every successful drug that survives the approval process, dozens more simply flame out. Millions of dollars of capital evaporate every time a clinical trial fails to produce positive results. #-ad_banner-# Yet a select group of biotech visionaries manage to strike it big — time and again. They have a knack for spotting biotechnologies that ultimately prove their mettle through the Food and Drug Administration’s rigorous process. And few have shown the gift of biotech insights like Randal J. Kirk. Kirk has built his fortune by focusing on drugs that have blockbuster potential. And he’s shown the patience to stick with them — for years, if needed — until his vision is realized. The payoff: He netted a $1.2 billion profit in 2007 when Shire (Nasdaq: SHPG) acquired New River Pharmaceuticals for $2.6 billion. New River had developed Vyvanse, a key drug in the treatment of attention deficit hyperactivity disorder (ADHD). Four years later, Kirk struck gold again as Forest Labs (NYSE: FRX) paid him $600 million for his majority stake in Clinical Data, which had developed Viibryd, an anti-depressant drug that hit the market in 2011. Since then, Kirk has remained off… Read More

Polyester-draped family photos aside, being a child of the 1970s was pretty cool in some ways. There were many things to dislike — bad hair, bad clothes and a lot of terrible music — but the TV shows weren’t too bad. For several years in the mid-’70s, my family used to sit down faithfully on Tuesday nights in front of our ridiculous console TV set to watch “Happy Days.” The series ran well into the ’80s, but most viewers gave up on it after the famous episode in which the Fonz jumped a shark while waterskiing. The series… Read More

Polyester-draped family photos aside, being a child of the 1970s was pretty cool in some ways. There were many things to dislike — bad hair, bad clothes and a lot of terrible music — but the TV shows weren’t too bad. For several years in the mid-’70s, my family used to sit down faithfully on Tuesday nights in front of our ridiculous console TV set to watch “Happy Days.” The series ran well into the ’80s, but most viewers gave up on it after the famous episode in which the Fonz jumped a shark while waterskiing. The series went downhill fast after that, giving rise to the awesome phrase “jumped the shark,” which is used to describe when something has peaked and rolled over.  Stocks, of course, are highly capable of jumping the shark. Let me be upfront. I’ve never been to a Chipotle Mexican Grill (NYSE: CMG) — but being in the investing biz, I’m familiar with the brand, thanks to the financial media’s nonstop gushing about the company and its stock. Clearly, Chipotle is a bona fide rock star. A double in two years is impressive, but these numbers are unsustainable. I don’t care… Read More