All I can say is, "What a contest!" Now, if you're totally befuddled, then you, a) are a regular reader, or b) have not read last Monday's "Prom Queen"
column. If it's the former, there's nothing I can do: You just have to keep on living with me. If it's the latter, then go back and peruse that most excellent piece of writing.
Now that we're all up to speed, let me unveil how the judging for our Prom Queen winners went. First of all, I was a complete doofus for compiling the winners by email. What I should have done was come up with 30 or so likely candidates, then used the
balloting gizmo. That would have been the easy way. Of course, it would also have cut down on the drama, as we'd have all seen the top 10 at the same time.
In any event, I was deluged with emails, as you might imagine. But I thank everyone who took the time to respond. It was most generous of you.
A few quick notes:
- Included on almost every ballot were runaway winners:
Cisco (CSCO) - Get Report,
Sun Microsystems (SUNW) - Get Report,
Intel (INTC) - Get Report,
Microsoft (MSFT) - Get Report,
Nokia (NOK) - Get Report and
JDS Uniphase (JDSU) . They were so numerous, I just stopped counting about halfway through.
Some folks were clearly campaigning for their favorites.
Pfizer (PFE) - Get Report?
Tyco (TYC) ? Superb companies, of course, but I'm not sure they're winning any pageants lately.
I was most heartened by two special nominations: One gentleman had
TheStreet.com (TSCM) on his list. Not sure what pageant that stock would be in, but thank you. Another had Nancy's company,
Digex (DIGX) . The stock has been performing beautifully lately, and she was quite pleased someone mentioned it. (I am long Digex, of course.) Nevertheless, it's not yet in the league of our 10 finalists. Perhaps someday.
OK, first the honorable mentions. These all received numerous votes and all just missed nabbing spots in the top 10:
And now, without further ado, our top 10:
(no surprise here. Everyone else was battling for second).
(also, not a surprise. McNealy gets the last laugh over
(ironically, still not that well-known in many circles).
(it just can't be kept down. Maybe the quintessential "buy-on-dips" stock).
(would have been higher, if not for the lawsuit stuff. However, also the closest stock to its 200-day moving average).
(first they conquer Finland ... then the world).
(another one I'd put in the JDS Uniphase camp. Wildly popular, but could get even
(resting right near an all-time high) and
(a perennial top 10).
(recent run has definitely had an impact on securing this spot).
OK, that's our portfolio. It would certainly place well in any beauty contest. Now, the rules:
- $50,000 goes into each stock, starting with its opening price on Monday.
Anytime a stock closes 10% below Monday's opening price, we plug in an additional $5,000. And for every additional 10% drop, we buy another $5,000 worth of that stock. (As an example, if we initially buy a stock at 100, we'll make our first purchase at 90 and our second at 80.)
We close out any position that closes below its 200-day moving average (we'll use a simple moving average vs. exponential).
We close any position that falls out of favor with the general public. If you feel at any time that one of our top 10 has suddenly become "ugly," let me know, and we'll put it to a
And that's it. If my theory is right, these stocks should wildly outperform the market, especially if we get a nasty decline where we can add more. And in that regard, I can see one psychological advantage to being a buy-and-holder: Every decline can be viewed as "good" since our favorite stocks are on sale. And every rise can be viewed as good since our portfolio further increases in value. It's really a win-win situation.
Personally, I'm already long Oracle, Nortel and Nokia. This morning, I added the seven others and have carved out 20% of my portfolio to execute this strategy. I'll keep everyone posted on a weekly basis!
Gary B. Smith is a freelance writer who trades for his own account from his Maryland home using technical analysis. At time of publication, he held a long position in TheStreet.com, Digex, Oracle, Nortel, Nokia, EMC, Broadcom, Microsoft, Intel, Sun Microsystems, Cisco and JDS Uniphase, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Smith writes five technical analysis columns for TheStreet.com each week, including Technician's Take, Charted Territory and TSC Technical Forum. While he cannot provide investment advice or recommendations, he welcomes your feedback at