Why are Tech Stocks Kicking Butt Amongst all the Fiscal Cliff Drama?
In the stock market, nothing is ever true straight across the board. While there are some exceptions to this pattern, I’m seeing a ton of technology stocks doing well. While other stocks are falling because of the Fiscal Cliff, pumping and dumping and going crazy, over the past month, many tech stocks are dodging the bullets and doing just great.
Take a look at these numbers:
Facebook (FB): Up more than 18% over the last month, quite surprising after the post-IPO lock up expired on November 14th.
Yahoo (YHOO): Up more than 25% over the last 3 months, while the S&P dropped 3% over the past 3 months. Go Marissa!
Research in Motion (RIMM): Up more than 53% this past month. Sounds like a cheesy lounge night club.
Zynga (ZNGA): Up more than 4% this past month
They all happen to be in the technology sector and have all out performed the market by a very nice amount.
Q: Why did this happen?
A: Matt Gohd, senior managing director at WallachBeth Capital says, “Find a group of stocks that everyone hates, that are down significantly, and buy them,"
This seems to be what happened here. These technology stocks had been beaten down so much and had such low expectations, that when the tiniest piece of good news came out, the result was a nice bump in the stocks price.
What’s the moral of the story?
Even in troubled economic times, you can buy and sell stocks and make money. You may have to look to unpopular or downtrodden stocks to pick your Long Buy position, but those opportunities to make money are always there.
Check out the Rachel Fox interview about stock trading.