10 winners, 10 losers in this year’s breakout small-cap stock sector Small-cap stocks have been outperforming large-caps by leaps and bounds in 2018. But within small-caps, the health-care sector’s performance has been downright breathtaking.
Looking closely at winners and losers in the sector may highlight some stocks that have gotten too pricey, while also possibly underlining some bargains.
The Russell 2000 Index RUT, +0.52% seems to dominate small-cap-related headlines in the financial press. But the more selective S&P 600 Small-Cap Index SML, +0.63% — 600 stocks versus 2,000 — has performed better this year and in the long run:
Total returns Index 2018 through July 16 2017 3 years 5 years 10 years 15 years S&P 600 Small-Cap 12% 13% 49% 91% 230% 438% Russell 2000 10% 15% 38% 73% 181% 332% Source: FactSet The better results from the S&P 600 might spring from S&P Dow Jones Indices’ criteria for companies to be included.
Within the S&P 600, the health-care sector has been, by far..Read More →

Opinion: The idea of ‘investing in what you know’ is more dangerous than you think Recently one of us was talking to a financial adviser from a medium-sized town in the South.
A fried chicken restaurant in the town, a favorite among locals, had just announced plans to expand regionally with the ultimate goal of becoming the next Shake Shack or Chipotle. The adviser’s phone was ringing off the hook with requests from his clients to invest in the venture. When he attempted to explain to them the complexity of the restaurant industry and the incredible risk associated with such an investment, he was met with a common refrain: “How can this go wrong? The chicken is so crispy and delicious.”
His clients’ enthusiasm makes a certain intuitive sense. One of the most common pieces of financial advice we hear is to “invest in what you know.” The advice is rooted in the philosophy of famed investors like Berkshire Hathaway’s BRK.B, -0.83% Warren Buffett, who has attributed his success to stayi..Read More →

EU set to slap Google with biggest-ever antitrust fine of $5 billion The European Union plans to hit Alphabet Inc.’s Google with a record antitrust fine of €4.34 billion ($5.06 billion) on Wednesday, according to an official familiar with the matter, in a decision that could loosen the company’s grip on its biggest growth engine: mobile phones.
A formal decision — which would mark the EU’s sharpest rebuke yet to the power of a handful of tech giants — is set to be taken during Wednesday morning’s meeting of EU commissioners following a presentation by competition chief, Margrethe Vestager, according to the person. No discussion of the decision is expected, the official said.
The EU’s antitrust regulator has been looking into whether Google GOOG, +1.26% GOOGL, +1.38% had abused the dominance of its Android operating system, which runs more than 80% of the world’s smartphones, in order to promote and entrench its own mobile apps and services — particularly the company’s eponymous searc..Read More →

Elon Musk apologizes to British diver for calling him a ‘pedo’ Elon Musk has apologized for a vicious attack on a British diver who helped rescue a group of boys from a Thai cave, saying his words were “spoken in anger.”
Over the weekend, the Tesla Inc. TSLA, +4.06% CEO branded Vern Unsworth a “pedo,” or pedophile, after the diving expert criticized Musk’s bid to help the rescue by sending in a mini-submarine. Unsworth described Musk’s offer as a PR stunt that had no chance of working.
“My words were spoken in anger after Mr. Unsworth said several untruths & suggested I engage in a sexual act with the mini-sub, which had been built as an act of kindness & according to specifications from the dive team leader,” Musk wrote in a tweet, posted Wednesday in reply to another Twitter user.
“Nonetheless, his actions against me do not justify my actions against him, and for that I apologize to Mr. Unsworth and to the companies I represent as leader. The fault is mine and mine alone.”
Noneth..Read More →

How to benefit from other people’s financial goofs This article is reprinted by permission from NerdWallet.
Most of us have wasted money on ill-considered purchases or stuff we really couldn’t afford. As we get more financially savvy, that happens less often. But we can still profit from other people’s bad choices.
People who prize the latest and greatest, for example, quickly need to upgrade to the next shiny thing. That leaves plenty of lightly used cars and electronics for sale at a discount.
People who can’t look beyond cosmetic damage also provide buying opportunities for those who can, since surface flaws can ding price without hurting functionality. Then there are the “d’oh” mistakes: the stuff that didn’t fit or turned out to be the wrong shade of robin’s egg blue. That stuff gets returned so it can be discounted and snapped up by frugal buyers.
Here are three ways to profit from others’ mistakes:
Buy off-lease cars Low payments can fool people into thinking that leasing i..Read More →