Here's the Secret to Making Money in Stocks This Year
By Jeff Cox, CNBC.com Senior Writer
NEW YORK (CNBC) -- Forget all those squiggly up-and-down lines on the charts, because stock market investing has been easy in 2012: Just look for all the companies that did poorly last year and watch them grow.
In fact, the rise of 2011 losers has been one of the few clear patterns in stock picking this year.
Though dividends and domestic stocks have gotten a lot of chatter, the truth is that the theme has been a very simple form of rotation, with the top 10 performers on the S&P 500 this year averaging a 2011 loss of 15%.
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- In the S&P 500's top 25, the average winner is up 61%, the average loser down 32.5%.
- Ownership by exchange-traded funds has played little role, with winners owned only slightly more often than losers.
- Dividends also haven't been much of a factor, with the average yield among the top 25 just 0.99%, compared to the 1.9% average for the 500.
- Mega-caps rule, with the average market capitalization rate, excluding Apple (AAPL) , at $18.4 billion "with plenty of +50 billion capitalization names in the mix." Smaller-caps dominate the bottom of the list.
- Sectors mean little either. "There are retailers at the top of the heap, and others at the bottom. Ditto for food companies, energy stocks, and household names in technology."
--Written by Jeff Cox for CNBC
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