The growth of the Internet has been one of the top advancements in history. But with this good news comes the darker side, namely cyber attacks that cost billions of dollars in damages along with non-monetary impacts. Millions of Americans have gotten their personal data stolen over the past few years, and it will likely only worsen. There’s also the threat of cyber attacks on key government and intellectual assets.
But with the threat also comes a potential investment opportunity in cyber defense.
President Obama just requested another $14.0 billion to improve the government’s safeguards. Could you imagine foreign threats hacking into our nuclear installations and military? The threat is real.
Think about what happened to Sony Corporation (NYSE/SNE), when its database was broken into, costing the company about $100 million. There were also the major breaches to The Home Depot, Inc. (NYSE/HD) and Target Corporation (NYSE/TGT). And just last week, the database at Anthem, Inc. (NYSE/ANTM), the country’s second-largest insurer, was hacked, impacting its 80 million clients.
Cyber Security Stocks a Boon to Investors in 2015?
Cyber security companies are attracting focus as an investment opportunity. The catalyst that will drive up the share price of these stocks will be security attacks that continue to plague companies and governments around the world and cause excessive monetary damage.
In the mid-cap area, an investment opportunity to look at is FireEye, Inc. (NASDAQ/FEYE), which was just hired by Anthem to help protect against further attacks. The company has a current share price of around $39.00.
FireEye has been a favorite on Wall Street following its debut in September 2013. The stock … Read More
The performance of many blue chips—consumer staples stocks, in particular—is really stunning. And looking at the shares and how much they’ve moved on the stock market, even since the beginning of the year, you really have to wonder how sustainable this stock market rally is.
I am a big believer in blue chips and investing in stocks that pay growing dividends over time. But right now, we have so many companies trading right at their all-time record highs. I wouldn’t say that the stock market is expensively priced, but realistically, other than momentum players, would individual investors be buying these stocks at their all-time record highs? I find that unlikely.
The stock market breakout really is meaningful and pronounced. Consider The Procter & Gamble Company (NYSE/PG), which has been bid up approximately 16 points since last summer. Procter & Gamble’s stock chart is featured below:
Chart courtesy of www.StockCharts.com
The stock market is most definitely due for a break. The leadership from blue chips has been significant, but it also reveals the fragility and uncertainty in the marketplace. Institutional investors want to buy stocks, and they are; but they are buying the safest names.
For the stock market’s current momentum to continue, technology stocks are going to have to show more leadership going forward. Investors are buying in anticipation of a decent first-quarter earnings season.
Among the many blue chips that are soaring in this stock market, consider Johnson & Johnson (NYSE/JNJ). This stock has been rising consistently and strongly since the beginning of the year. Its performance is so unusual. It really is a powerhouse breakout. Johnson & Johnson’s … Read More
The housing slump in 2007 and the financial crisis following it left the U.S. economy in sorrow. Millions of Americans lost their savings due to the stock market collapsing to the lowest levels experienced in a while. Key stock indices in the U.S. have shed more than half of their value, and some of the well-known companies went underwater.
Having said that, the key stock indices in the U.S. are back to where they were before the financial crisis began. But while the stock markets have recovered, many investors have lost courage to get back into the markets. What should investors do if they are unsure about investing in the stock market again?
The most important thing investors need to keep in mind is that fluctuations in the stock market are very normal—they shouldn’t discourage investors from investing and growing the value of their portfolios.
There have been many instances in the past when the key stock indices in the U.S. plummeted, leaving investors in misery.
Furthermore, investors need to know that investing in the stock market isn’t easy either. No matter how much information an investor might have about a stock, there is still some risk associated with it—sometimes, losses are imminent no matter how good the company may be. Losses can occur as a result of poor overall market conditions or many other factors.
However, if investors master two techniques—taking profits and learning from mistakes—they can minimize their losses, and at the end of the day, they can become better investors.
1. Taking Profits
As I mentioned earlier, key stock indices are trading at the same levels they … Read More