Richie,
As to when Dell's growth rate slows down, your guess is as good as mine. I would have to disagree, though, that small retail investors are fully invested. Why? For starters, let's examine the holdings of our own retail accounts. Ours is an office of 58 brokers with over $3 billion in assets. The average length of service and experience is much higher than the norm in the industry, and although situated in Montreal, our investment culture and focus is very much a U.S. one.
In fact, if you walked into our office, it would be no different than walking into a Merrill Lynch in NYC, or Los Angeles.
The point I am making is that our retail holdings of core positions within a sector is probably a reflection of the general market at large, not unlike a pollster who polls 1000 households and from those results accurately predicts the will of a nation to within a few % points.
Suffice it to say that our core position in Dell is miniscule, even unbelievable when I quiz some of our brokers on this stat. On the other hand, our office has what one could consider an average amount of Compaq, IBM, and Microsoft. I can't be more significant on this point except to say that Dell in severely under-owned
I submit to you that as the position in Dell reaches that of the other sector players, so will its share performance.
Not the most scientific analysis in the world, but one that a pollster and student in human behavioral patterns would endorse no doubt. After all, is investor behavior not what the art of technical analysis attempts to measure?
Gene Piccoli |
