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(B)(N) S&P 100 (The Empty Glass)

February 28, 2014
The Dog Ate My Lunch

The Dog Ate Their Lunch

Drama. Investors show their displeasure or despondency by shooting themselves in the foot and the echo sets off an avalanche of trepidation and uncertainty. Sympathy?

The eight distinguished companies in the S&P 100 that are in “The Empty Glass” would have been better bought in 2012 rather than now but now is still not too late. Something caused them to panic in 2012 and drop $70 billion – does anybody remember what it was? – and buy back their positions for the next two years. Please see Exhibit 1 below for more reasons to regret.

Exhibit 1: The S&P 100 Trifecta – The Empty Glass – Fundamentals – February 2014

The S&P 100 Trifecta - The Empty Glass - Fundamentals

The S&P 100 Trifecta – The Empty Glass – Fundamentals

(B)(N) S&P 100 Trifecta - The Empty Glass - Risk Price Chart

(B)(N) S&P 100 Trifecta – The Empty Glass – Risk Price Chart

Two of the eight (Caterpillar Incorporated and Cisco Systems Incorporated) are already back in the saddle and trading in the Perpetual Bond™ but, of course, we know nothing of the future of the others, four of which have been shot down since December. Please see Exhibit 2 below.

In aggregate, the companies earned $24 billion last year for a return on the shareholders equity of 11% (which is a “banking rate” but these are difficult times) and they paid $10.9 billion in dividends for a return of earnings of 45% and dividend yield of 2.7% which effort is not exactly kibble but the aggregate market value is up only $20 billion and +5% last year.

Our estimate of the downside due to the demonstrated volatility is minus (7%) in the next quarter. Everything else in the S&P 100 is trading in the Perpetual Bond™ at the present time and that portfolio is up +35% last year and another +2.8% so far this year.

Exhibit 2: (B)(N) S&P 100 Trifecta – The Empty Glass – Prices & Portfolio – February 2014

(B)(N) S&P 100 Trifecta - The Empty Glass - Prices & Portfolio - February 2014

(B)(N) S&P 100 Trifecta – The Empty Glass – Prices & Portfolio – February 2014

(Please Click on the Chart to make it larger and again if required.)

For more on the “Trifecta” and what it means, please see our recent Post (B)(N) The NASDAQ 100 Trifecta.

And for more information on “risk management” and additional references to the theory, please see our recent Post, The RiskWerk Company Glossary.

And for more on what risk averse investing has done for us this year, please see our recent Posts on The S&P TSX “Hangdog” Market or The Wall Street Put or specialty markets such as The Dow Transports & Utilities or (B)(N) The Woods Are Burning, or for the real class actionLa Dolce Vita – Let’s Do Prada! and It’s For You, Dear on the smartphone business.

And for more stocks at high prices, The World’s Most Talked About Stocks or Earnings Don’t Matter – NASDAQ 100. And for more on what’s Working in AmericaBig OilShopping in America or Banking in America, to name just a few.


We are The RiskWerk Company and care not a jot for mutual funds, hedge funds, “alternative investments”, the “risk/reward equation” and every other unprovable artifact of investment lore. We have just one product

The Perpetual Bond
Alpha-smart with 100% Capital Safety and 100% Liquidity
With No Fees and No Loads on Capital

For more information on RiskWerk, please follow the Tags or Categories attached to this Letter or simply enter Search for additional references to any term that we have used. Related data may be obtained from us for free in a machine readable format by request to


Investing in the bond and stock markets has become a highly regulated and litigious industry but despite that, there remains only one effective rule and that is caveat emptor or “buyer beware”. Nothing that we say should be construed by any person as advice or a recommendation to buy, sell, hold or avoid the common stock or bonds of any public company at any time for any purpose. That is the law and we fully support and respect that law and regulation in every jurisdiction without exception and without qualification to the best of our knowledge and ability. We can only tell you what we do and why we do it or have done it and we know nothing at all about the future or the future of stock prices of any company nor why they are what they are, now. The author retains all copyrights to his works in this blog and on this website. The Perpetual Bond®™ is a registered trademark and patented technology of The RiskWerk Company and RiskWerk Limited (“Company”) . The Canada Pension Bond®™ and The Medina Bond®™ are registered trademarks or trademarks of the Company as are the words and phrases “Alpha-smart”, “100% Capital Safety”, “100% Liquidity”, ”price of risk”, “risk price”, and the symbols “(B)”, “(N)” and N*.

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