To: TokyoMex who wrote (1621 ) 8/8/1998 9:52:00 PM From: DessertRat Respond to of 119973
Russell 2000 stocks way down...here's an interesting email I got... This site picks really good small caps based on Value Line rankings and has done better than Russell 2000 in the past. But go to the site and look at their picks for the months of May, June and July. All RED ink. WOW!!! I thought they were kidding about the Russell 2000 being down. YIKES!! The good news is the Russell 2000 appears to have bottomed and is on its way back up. ....... Dear Friends of Value & Growth Stock Review, Please note that the August Top 20 Stock List has been posted to Value & Growth Stock Review at vgsr.com As of the end of July, the performance disparity between large-cap and small-cap stocks this year has become too startling to ignore. Thus, I offer the following observations -- all gleaned from sources believed to be reliable, of course. (1) The Russell 2000 Index, one of the more common benchmarks for small stocks, has declined over 15% since hitting its all-time high earlier this year. In contrast, the S&P 500, the usual performance benchmark for large stocks, has only fallen 5.5% from its all-time high. (2) Five stocks in the S&P 500 have produced about one-third of that Index's return so far this year. Those five stocks are Microsoft, Pfizer, Lucent, Wal-Mart and GE. The long and the short of this phenomenon is that if those stocks have been missing from your portfolio, you probably haven't kept pace with the "market," -- unless you've been blessed to have held some "anything.com" stocks. (3) As measured at the close of the market last Tuesday, the average NYSE stocks had declined 24% from its 52-week high, and 51% of NASDAQ stocks have declined 30% or more from their 52-week highs. Not surprisingly, the VGSR.COM stock lists have suffered along with the general small-cap stock market. Readers of VGSR.COM should not expect the Top 20 Stock Lists or the Model Portfolio to perform better than the Russell 2000 Index or the S&P 500 Index during periods of broad market corrections or during full-blown bear markets. The value of the VGSR.COM selection strategy has been very apparent during positive markets, and thankfully, positive markets tend to be of much longer duration than negative markets. I am not a proponent of market timing, so I prefer to live with the negative periods and view them as part of the cost of capturing the superior returns during the positive periods. I do not know when this current negative market will reverse, but I do believe that when it does, the VGSR.COM selection strategy will produce significantly positive results. Best regards, Greg Wurzburger