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Monthly Archives: December 2010

DANG: A Hot and Risky Chinese IPO

December 17, 2010
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IPOs are always risky, and those of Chinese companies are especially so. Still, a Chinese enterprise with very a very attractive story has recently come public on the New York Stock Exchanges as an ADR (American Depositary Receipts).  Listing as ADRs confirms a company’s commitment to abide by U.S. accounting standards, including compliance with Sarbanes/Oxley regulations.  This is a significant boost to the reliability of revenue and earnings reporting. The company is E-Commerce China Dangdang (DANG), known as Dangdang to its friends, an online bookseller that’s been following in Amazon’s footsteps by growing out of that category and into...

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My Economic Predictions for 2011

December 16, 2010
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My Economic Predictions for 2011

It’s easy to say that Cabot’s growth investing disciplines don’t try to anticipate what the market is going to do next. After all, the Cabot Tides, Cabot Trends and Two-Second Indicator, as well as the Cabot China-Timer, are all market trailing measures.  (That means they’re based on how the market has performed in the past, not how we think it’s going to do in the future.) But this is also the time of year when we are contacted by various publications and columnists who want to know our economic and market outlooks for 2011.  They also want our picks...

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Two Great Insurance Stocks

December 14, 2010
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Last week my Advisory led off with a question from a man concerned about “building a Family Legacy For Future Generations.” One of my readers, Bradley K., was kind enough to send this response: “Tell the reader who is worried about estate building to buy life insurance.  Proceeds are not income taxable, & policy ownership can be arranged to avoid estate taxes too. Spendthrift provisions can be arranged thru the use of life insurance trusts. “Whole Life is not subject to the vagaries of the market, either.  Don’t buy Universal Life or Variable Life for this purpose.” For the record,...

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How to Handle Winning Stocks

December 13, 2010
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How to Handle Winning Stocks

With the market’s pullback/correction/retreat/whatever-you-want-to-call-it coming to an end, I wanted to review a few ways you can go about handling your stocks … especially your winners. Any growth-stock investor worth his salt cuts all his losses short.  Whether it’s at 5% or 15%, at some point, any good investor who’s going to have success over many years will cut losses.  Also, any investor who’s going to make good money in the market takes good-sized positions.  Thus, for purposes of this discussion, I’ll assume all losses are cut short, and that position sizes are big enough to matter (each position...

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An Indian Stock for the Future

December 11, 2010
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This week, I collected the responses from the survey found at the bottom of each issue of Cabot Wealth Advisory. Many of you have taken the time to fill it out and I appreciate all of your feedback. Several readers asked the same questions, so this week, and for the next few weeks, I’ll be going over those topics. Without further ado … Question: I lost a lot of money in the first year of Cabot Small-Cap Confidential. I would like to know what has been your success (or lack thereof) in the following years? Answer: We started Cabot...

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