Tech Stocks
So today’s little excerpt is about the DJIA Tech Stocks. Remember when the big thing was to buy tech stocks. Well lets find out a little more about them here. If you are new to the Bullhunters Guide blog, I am dissecting the eBook so that we can understand the workings of the US stock market a little better. The Bullhunters Guide to the US Stock Market is downloaded hundreds of times every week so get your free copy now just to your right of this screen so that you have your own copy to read whenever you like. Let’s continue…
DJIA Tech Stocks
Hewlett Packard, IBM, Intel and Microsoft are the pure tech stocks in the Dow. AT&T and Verizon are telecommunications companies. While all of these companies benefit from a strong economy, corporate customers often invest in technology and telecommunications in the period directly before a recession. This makes tech stocks somewhat counter-cyclical.
Technology stocks are also more individualistic than most stocks. For example Hewlett Packard (HP) has a strong direct competitor in Dell. While what’s good for GM is typically good for Ford, HP and Dell go in opposite directions. The same can be said for Intel and its prime competitor, Advanced Micro Devices (AMD).
As one of the largest companies in the world, Microsoft is often the creator of cycles. Every time ‘Mr. Softy’ (as it is known on Wall Street thanks to its MSFT ticker symbol) releases a new operating system, millions of businesses must upgrade. This alone causes a bullish tech cycle, with many business and individuals purchasing new computers and other hardware.
Tech Stocks
So as we can see from this little excerpt, the tech stocks perform best when the economy is in the later stages of the business cycle which are the predictable cycles of economic activity that repeat over time. The five stages of the business cycle are growth, peak, recession, bottom (or trough), and recovery. They would be great on your watchlist even if you don’t trade them to give you some idea of how the market is performing.
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Sean Rasmussen has been working on the next instalment of the Bullhunters Guide and you have been waiting patiently for it. In it he will discuss the renting shares strategy that Jamie McIntyre teaches in the 21st Century Academy homestudy and how to apply it to the US stock market.
To Your Success
Angela Recchia
Graduate Support
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