Research in Motion, Fundamental Indexing, Gold Stocks

Research in Motion got crushed yesterday down 13% and down another 3.5% so far today. Stocks trading at very high price earnings multiples are usually priced to perfection and need continuous astronomical growth rates both on the top (revenues) and bottom lines (net earnings) of their income statements to maintain their price. Subscriber growth is still very impressive but earnings are down due to expenditures to bring their next generation of phones to the forefront.

Its days like these where fundamental indexing gets a closer look. RIM represents ablout 6% of the TSX60 but get a weighting of about .71% based on fundamentals. You can go to our previous blog entries to learn more about fundamental indexing.

Gold stocks have rallied big time over the last two days up over 10% as gold increased about $50 an ounce the last two days. Gold has broken out about its 50 and 200 day moving averages as support has built around $860 leading one to think gold may break significantly higher based on technical analysis. What are your thoughts on the near term price on gold?

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