$COMPQ - YTD Laggards 11-12-17

Today, I will delve even deeper into my statement, “Wall Street makes its money with us being in the market. We make our money with what we own and when.”

Last week, I analyzed four main Dow stocks that grossly outperformed the Dow Jones Index.

Today, we analyze a performance chart of the Nasdaq Composite ($COMPQ) and four additional main Nasdaq companies — Akamai Technologies Inc. (AKAM), Sears Holdings Co. (SHLD), Ritter Pharmaceuticals Inc. (RTTR) and CHFS Solutions Inc. (CHFS). Plus, I included the main Nasdaq Exchange Traded Fund (QQQ).

Per my chart, the 2017 year-to-date performance of the Nasdaq Composite is 25.39 percent, and QQQ is 30.63 percent. The four featured Nasdaq companies and their performance: Akamai -19.24 percent, Sears Holdings -50.48 percent, Ritter Pharmaceuticals -87.93 percent, and CHFS -97.78 percent.

No one knows which stocks will outperform or underperform any index. One could have been in either of these four Nasdaq companies and would have grossly underperformed the Nasdaq.

Keep in mind, each one of these stocks at one time was given a “buy” recommendation by rating agencies. In reality, a stock with a 50 percent drop has to retrace 100 percent to break even. Imagine the percent return these stocks must perform to get back to their original Jan. 2, 2017, price.

Many investors only look at the index returns and assume their funds are doing as well — while their stocks could be doing a lot worse.

Here’s what you need to think about:

First, do you know which index your stocks are in?

Second, if so do you know how your index is performing?

Third, are you tracking your holdings to monitor their performance?

Fourth, if not, why?

Remember — Wall Street makes its money with us being in the market. We make our money with what we own and when.

Plan your work, work your plan, and share your harvest!

DAVID O. ENGLAND is the founder of the Eye on the Market-Training Academy (Davidoengland.com) and Associate Professor Emeritus of Finance. This column is for educational purposes only and not intended as financial advice. Your decision to buy, sell, short or hold any investment product is a direct result of your decisions, free will, and research. For questions-send to thetraderseye@gmail.com.


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