“The optimist sees the donut, the pessimist sees the hole.” ― Oscar Wilde
In the reflection section we looked at some random thoughts including the concept of risk and return. We looked at a small capitalization stock that had a significant decline after a change in management. It explains why small capitalization stocks trade at a discount to their large capitalization peers. Then we looked at the risk of purchasing an illiquid private placement and how some people do not see the risks. That is why perception is so important. We took a look at the major technology crash this month and the minor impact on the stock of the company that was responsible. I guess, others have a different perception of the magnitude of the outage.
We have added a new phrase to our lexicon, The Great Rotation. When the large cap technology stocks had a weak month pundits spouted that a great rotation out of large cap technology stocks, the magnificent 7, had begun and investors were now looking at the smaller capitalization stocks that had lagged their large cap peers. We remain focused on dividend paying stocks that will pay the investor whether the stock rises or falls. Consistent dividends help provide stability to a portfolio.
