05/12/06

Commentary:  Ouch!

We were cruising along, and then -- wham! -- our
worst week in almost two years. Is this the start
of something terrible? Or a pause on the way up?

No one knows, of course. We don't even know
what happened, or who it was that let the bears
out. Was it Bernanke? Does he need another
session with Maria to smooth his rough edges?

We'll just have to wait to see what happens. At
which point, of course, there will be no shortage
of people telling us they knew it all along. But for
now, the future is a mystery waiting to unfold.

Personally, when the market takes a beating like
this, I become terribly pessimistic. Similarly, when
the market is going up, I feel it will never end.

Of course I have it backwards. Buy when there's
blood in the streets, we all know that. But after
what happened in 2000 to 2002, that's easier said
than done.

For now, I can think of a plague of reasons for
caution. But I can also think of a bloom of
reasons for optimism. We live in exciting times.

George Gilder was featured this week in The Wall
Street Journal Online. If you missed it, you can
find it under "Press Clippings" on the left.

The Week Day by Day:
 


It was a wretch of a week. As usually happens
at such times, the GTI lagged the NASDAQ, but
we'll make it back on the way up -- whenever
that might be.


The Week's Top Gainers and Losers

Gainers Losers
 CPHD + 7.1%   MVIS - 24.1% 
 ENER + 0.6%   NETL - 19.3% 
 ADI + 0.6%   KEYW - 17.3% 
 IKAN + 0.1%   FNSR - 13.7% 
     BRCM - 11.7% 

Not much good news here.

Returns for the Week:

Gilder Technology Index (GTI):  - 7.0%
Nasdaq Composite Index (NSD):  - 4.2%
S&P 500 Index (S&P):  - 2.6%


Historical Returns:

Period GTI    NSD  S&P 
1997 (est'd) 21% 22% 31%
1998 (est'd) 48% 40%  27%
1999 284% 86%  20%
2000 - 44% - 39% - 10%
2001  - 43% - 21%  - 13%
2002 - 56% - 32% - 23%
2003  130% 50% 26%
2004   3% 9%    9%
2005   5%  1% 3%
2006 to date  19.4%  1.7% 3.4%
Avg for 9+ yrs  11.8%  6.1% 6.1%
Last 52 wks 44% 14% 12%
Since the high
of 3/06/00
- 74% - 56% - 15%
Since the low
of 10/09/02
344% 101% 66%

Comparison of Returns for GTI Stocks
By Whether or Not They Pay Dividends:

Year Do Pay
Dividends
Do Not Pay
Dividends
2004 11.6%   - 3.3%  
2005 11.1%   4.2%  
2006 to date 2.7%   25.8%  
Avg for 2+ yrs 10.8%   10.6%  

Room to Grow:

  GTI NSD S&P
Loss from the
high to the low
94%   78%   49%  
% of the loss
recovered
22%   29%   69%  
Return needed
for a new high
279%   125%   18%  

Graph of the GTI's long recovery attempt.  

Individual Year-to-Date Returns:

ADI

1%

 

GLW

27%

 

QCOM

14%

ALTR

6%

 

IKAN

14%

 

S

5%

AMD

3%

 

INTC

- 23%

 

SIGM

- 12%

BRCM

16%

 

KEYW

1%

 

SMI

9%

BWNG

109%

 

LNOP

82%

 

SYNA

- 1%

CPHD

10%

 

MVIS

- 19%

 

TSM

3%

ENER *

10%

 

NETL

17%

 

TXN

4%

EQIX

55%

 

NSM

10%

 

XLNX

9%

FLEX

13%

 

PCMS *

- 20%

 

ZRAN

62%

FNSR

118%

 

PWER

17%

     

* Joined list this year (ENER 2/10, PCMS 4/7).
  Return is while in GTI only.

 

 

The Year to Date:




From the GTI's Origin (1/1/99) to Now:




Weekly Change in the GTI, Last 52 Weeks:





Trailing 3-Month Returns, Last 52 Weeks:


 
Makeup of the GTI:

The GTI companies are those "Telecosm
Technologies" in the Gilder Technology
Report whose stock is readily available to
investors. If a company is not traded on the
NYSE, AMEX, or NASDAQ National Market,
it is not in the GTI.

There were 29 companies in the GTI this
week. They are listed, with year-to-date
returns, at the bottom of the left column.

Advances vs. Declines:

Among the GTI stocks this week, there were
4 up, 25 down, 0 unchanged.


Volatility, Trend, Recovery:

As an indication of volatility, this table shows a
verage weekly change in the GTI
each year:

 
Year Ave Wkly Change
1999 4.2%
2000 7.7%
2001 8.5%
2002 6.8%
2003 4.3%
2004 3.4%
2005 2.1%
2006 to date 2.8%

As an indication of trend, this table shows
number of up weeks for the GTI each year
:

 


Year
Number of Up Weeks
As a %
1999 39 of 52 75%
2000 24 of 52 46%
2001 22 of 52 42%
2002 19 of 52 37%
2003 31 of 53 58%
2004 28 of 52 54%
2005 26 of 52 50%
2006 to date 11 of 19 58%