How You Can Profit From Maximum Pessimism
Stock Profits from Today’s “Maximum Pessimism”
by Louis Basenese, Advisory Panelist
Senior Analyst, The Oxford Club
Wednesday, January 21, 2009: Issue #919
Yesterday was a train wreck for State Street Corp. (NYSE: STT). The stock cratered 59%. But don’t read too much into it…
Sure, the company’s quarterly results sent most investors into shock. A 71% drop in earnings? Another $1 billion in new credit exposures? If no one’s lending, how in the world are they just now discovering this liability?
I’ll be the first to confess, I flubbed the extent of the downturn in the financial space. Last April, I recommended “backing up the truck” and playing the rebound via the Financial Select Sector SPDR ETF (AMEX: XLF). Instead of a short-term opportunity, it’s turned into a really long-term rebound play. Read more…