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Date this Page Was Last Updated:
06/28/09 Your Personal Portfolio
is a personalized stock and mutual fund newsletter primarily designed for the
long term investor The S&P 500 dropped last week and is now up 1.8% for 2009. After dropping below the 700 support level in March the market made a short term bottom and has since climbed steadily. The next major resistance level is in the 880-950 range which it is now inside. For the market to continue to recover it has to move through this level. In all probability it will retest the lows before breaking through 950. Congress has passed the Economic Recovery and Renewal Act which provides a combination of tax breaks and special spending in an attempt to stop the recession and is now working on a robust budget for FY2010 The Fed outlined a plan to inject even more capital into the economy via cheap loans to banks, again raising the concerns about future inflation. With rising unemployment and dropping retail sales there is now little doubt the US economy is in recession, the debate is when it will end. In spite of world economy in recession, the price of oil has rebounded and just recently dropped back from $71 per barrel, as demand is stabilizing. For the week, the S&P 500 finished at 918. The yield of the 10-year U.S. Treasury bond dropped to 3.52%. The recent increase in yield for for treasuries indicates investors are leaving the safe haven to accept more risk in the stock market. The outlook for the economy in 2009 is not good. The Fed Chairman Bernanke suggests we will come out of the recession by the end of 2009. Others predict we will not come out of the recession until late 2010 or 2011. If this is true then the stock market will struggle. There is a serious question about liquidity within the economy. In spite of the Fed lowering its Fed funds rate to almost zero, in spite of the bailout money, in spite of the government guaranteeing the riskiest of investments by AIG, there continues to be a problem with liquidity that goes back to the excessive lending practices of the mortgage industry and the excessive leverage the investment banks used to acquire depreciating mortgage assets. On top of that, investor confidence in the US investment environment has declined dramatically. This is reflected in the dropping of Price to Earnings ratios. Those ratios are still high by historical standards. If investors do not regain confidence in the system then PE's could continue to drop. Matched with a declining economy and earnings this could mean further pain for the stock market. For an analysis of how the Financial Crisis occurred click on the above Analysis of Financial Crisis bar
As of 28 June 2009 PIRRSPICKS stocks Up 4.9% S&P 500 Up 1.8% 2008 results: PIRRSPICKS stocks down 30.4%, S&P 500 down 38.4% 2007 results: PIRRSPICKS stocks up 4.5%, S&P 500 up 3.5% 2006 results: PIRRSPICKS stocks Up 9.9% S&P 500 up 13.3% 2005 results: PIRRSPICKS stocks Up 7.1% S&P 500 up 3% 2004 Results: PIRRSPICKS Stocks up 17.2% (the S&P500 was up 9%). PIRRSNL Select funds Up 6.3%. Select Funds down 40.9% in 2008 (US Stock funds down 40.1%) Select Funds up 7.7% in 2007 (US Stock funds up 6.6%) Select Funds up 14.9% in 2006(US Stock funds up 13%). Select Funds up 7.9% in 2005 (US Stock funds up 7.3%). Select Funds up 11.7% in 2004 (US Stock funds up 11%).
Our MissionTo provide effective but low cost investment advice to the small, long term investor. To increase our subscriber's wealth while limiting their risk.
About the Personal Investors Research and Reporting Service News Letter (PIRRSNL)In business since 1993, the PIRRSNL has guided subscribers/investors to gains that have consistently beat the market averages. PIRRSNL produces Your Personal Portfolio a newsletter that is specifically tailored to each subscriber's stock and/or fund holdings. Stock recommendations are based on analysis of a company's past earnings history, current earnings growth prospects and long term growth prospects. While dividends do not have to paid it is an important factor when considering a stock. If a dividend is paid there should be a history of dividend growth. Closely related to strong earnings and dividend growth is the relationship between earnings growth and Price to Earnings (PE) ratios. A wide variety of sources (e.g. Value Line, Standard & Poors, internet investment research sources (such as AOL's Personal Finance section and Yahoo's Finance section) are used to obtain data on stocks. PIRRSNL's fund analysis primarily considers how a fund performs versus the other funds in its Group/Category (i.e. Growth, Aggressive Growth, Growth & Income, Income, Balanced, etc.). Recommended funds are selected because they have performed as well as or better than the average fund in their Group/Category. PIRRSNL uses Morningstar and internet investment research sources to develop its fund data base.
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