THE REMEMBERING A FRIEND EDITION
11 MAY 2012
In Remembrance: Amy Rauch Neilson
By Doug Gerlach, ICLUBcentral
The StockCentral community was extremely sad to learn that Amy Rauch Neilson passed away at home on May 6 at the age of 43 after a long battle with cancer.
Amy was a longtime associate of BetterInvesting and ICLUBcentral. At one time she was the managing editor of BetterInvesting Magazine and wrote the popular “Beginner’s Corner” column for many years. She also edited the newsletter for the youth membership and continued to contribute articles to BetterInvesting.
For the last several years, she was the pseudonymous “StockCentral Reporter” who created the semimonthly StockCentral Gazette email newsletter, and she also wrote a regular column on investment clubs that was published on the StockCentral.com website.
Amy also wrote a book on starting and running an investment club that’s about to be published in ebook form by ICLUBcentral: The myICLUB Guide to Starting an Investment Club.
Amy was an exceptional writer who contributed articles on a freelance basis to many publications. She was committed to demystifying personal finance and investing for beginners, and I was perennially in awe of her writing abilities and professionalism.
Amy’s battle with cancer is documented on her blog, It’s in the Genes. She’d been working on her memoirs, telling the story of the four generations of women in her family who have carried the BRCA1 gene. She was a tireless warrior and advocate for breast cancer research, treatment and care, appearing in many newspaper and television stories.
A 529 College Savings Plan has been established for Amy and husband Don’s son, Theo. Details are available here.
Compare a Stock to Its Peers
StockCentral's Sector/Industry Average Browser is a powerful tool for reviewing industry and sector averages, and for seeing how your company stacks up against its peers in several key areas.
When you first load the tool, which is in the Data tab of StockCentral.com, you'll see a listing of all the sectors and their component industry groups. If you want to jump right to a particular sector, such as Basic Materials Energy, Healthcare, or Technology, select it from the dropdown listing at the top of the page and you'll be presented with a table of all of industry groups in that sector and their key averages.
If you've already identified an industry group, you can choose it from the "Locate Industry" dropdown list at the top of the page. From there, you can drill down to see all of the component companies in that industry, while the industry averages are retained at the top of the page for easy comparison. Click a company name to load the Company Report for that stock.
If you don't know the specific industry group in which a company has been categorized, try loading that stock in the StockCentral Company Report, also in the Data tab. The industry is identified in the Company Info section at the top of the page.
For each sector, industry, and company, seven criteria are provided. These are key ratios that can help you determine whether a company is a leader or laggard amongst its peers. The values are Average 5-Year Pre-Tax Profit/Sales, Average 5-Year Return on Equity, Average Debt/Equity, Average 5-Year Revenue Growth, Average 5-Year EPS Growth, Average P/E Ratio, and Average EPS Predictability (R2).
One of the handy features of the tool is the ability to save any page as an Excel spreadsheet. Click the Save as Excel link at the top right of any table to download the results in this format.
Finally, throughout the tool, click any column header to sort the table by that criteria. This is terrific for finding candidates for study or comparison in a particular industry.
The Sector/Industry Average Browser is a unique tool that you'll find only on StockCentral.com, so be sure to make regular use of it in your stock study routine.
You're Doing It Wrong! J.P. Morgan Chase Loses $2 Billion in Hedging Strategy
J.P. Morgan Chase announced on Thursday that it had lost $2 billion in trading since April, pushing the firm to announce that expected losses for the second quarter could top $800 million. Company CEO Jamie Dimon stated that the trading losses were due to "errors," "sloppiness," and "bad judgment."
Needless to say, J.P. Morgan Chase's stock fell after the announcement. Somewhat predictably, though less understandable, is the accompanying decline of many other financial and bank stocks. Why should Bank of America's stock fall on the news of bone-headed moves by the trading desk at J.P. Morgan Chase?
Ironically, it appears that J.P. Morgan Chase's losses came from a trades that were made in a hedging strategy meant to reduce risk! Rumors abound that the trading involved the notorious "credit default swaps," the same "financial weapons of mass destruction" that brought down the financial sector in 2008. Obviously, it doesn't take a genius to recognize that any idiot can lose $2 billion in the markets if they're given enough money to start with, and little oversight.
This reporter is certain that our readers don't have to worry about losing $2 billion in the markets. Further, those who adhere to StockCentral's commonsense investing approach have all the tools that they need to invest successfully in the stock market. Maybe J.P. Morgan Chase should sign up for some StockCentral subscriptions for its staff. ...