Gotta love that market timing

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Mar 6, 2009 11:44 am

Capital Group's GE Bet Backfired Article published on March 5, 2009


Capital Group may have lost close to $900 million on its fourth-quarter investment in General Electric, Bloomberg reports.


GE's No. 1 shareholder boosted its stake by 15% in the quarter, adding 77.8 million shares, according to Bloomberg data. If it held on to the shares, the paper loss from the newly bought shares would be equal to about $894.7 million, based on an average fourth-quarter price of $18.18, Bloomberg calculates. (The shares fell 4.56% on Wednesday, to close at $6.69.)


Among the big buyers were the $111.8 billion Growth Fund of America, which added 18.3 million shares in the quarter, and the $49 billion Investment Company of America, which picked up 16.5 million shares, Bloomberg notes.


GE plunged 56% last year and is down another 59% this year.


Others likely licking their wounds from fourth-quarter GE investments include Fidelity, Dodge & Cox and T. Rowe Price. Fidelity, for instance, bought 21.4 million GE shares, giving it 82.3 million, according to Bloomberg.


Axa and JPMorgan Chase were big GE holders who cut their stakes in the quarter. Axa trimmed its position by 8 million shares, to 84.3 million. JPMorgan shed 10.3 million shares, leaving it with 74.8 million, Bloomberg says.


Purchases by Capital Group's three units — Capital World Investors, Capital Research Global Investors and Capital Guardian — pushed its total stake to 610 million shares, or 5.8% of those outstanding.

Mar 6, 2009 11:56 am

Let's see...Still paying a dividend on common, albeit a smaller one, and the corporate debt was just upgraded by Barclay's. 


That may turn out to have been the play of the year.

Mar 6, 2009 11:56 am

Then there's Buffett call a bottom 25% or so total market valuation ago ... investing is not glamorous. Worse, you could do as well as Buffet overall (okay, not), and not have a clue how to spend your money. There's such a thing as being too close to the market.

Mar 6, 2009 9:17 pm


Caught this article today about "bottoms". Actually pretty funny.
 
http://www.cnbc.com//id/29550282
 

Mar 20, 2009 4:01 am

Market timing is the strategy of making buy or sell decisions of financial assets by attempting to predict future market price movements.
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Mar 23, 2009 8:40 pm
e.giftshoppe:

Market timing is the strategy of making buy or sell decisions of financial assets by attempting to predict future market price movements.



It's a noble vocation and not for everyone.