Google, IBM, Oracle on the Bias Train
But do still offer some safety.
So what now? I'll pose this with some Monday morning mining of the investment collective. It seems like everyone is universally convinced of these factors:
1. The dollar will weaken.
2. The bailout plan will cost the US a massive amount of money.
3. It won't be the silver bullet.
4. Every industry will be impacted, and forward estimates are likely still much too high.
For argument's sake, let's say the minority view is largely the opposite. (My view is more complex and is a mix of both in varying degrees, as I will articulate in a later piece.)
If you believe in the above scenario and are looking for technology investment themes, it's still an easy call. Only take on exposure to large industry leaders that will benefit from a weaker dollar. Don't chase beta, and hedge with cash and options.
Names like Hewlett-Packard (HPQ), IBM (IBM), Google (GOOG), and Oracle (ORCL) offer some safety, but will lead the survivorship bias train.
If you believe the opposite or some variation, then adding some beta now makes sense. Stay with quality, but you may want to look for a niche leader which is carrying some debt. Who might be involved in a take-out.
Is the company levered to the consumer that might still be spending, or is there an area which may now rapidly turn if the credit markets unfreeze? On this side of the ledger would reside the likes of Apple (AAPL), Logitech (LOGI), Blue Coat Systems (BCSI), VMWare (VMW), Alvarion (ALVR) and Broadcom (BRCM).
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