Monday, March 16, 2015

Strong Dollar,Appreciation Recasts Investing Strategies

Chipmaker Qualcomm will buy back 15 billion in stock,10 billion of that over the next 12 months.It has 31.6 billion in cash on hand,and will increase its dividend by 14%.It is contemplating a debt issue plus use cash for the buyback.Shareholders have been pushing for this bigger return on investment.Along with this accelerated repurchase,the company has just announced some new chips that are going to be important to its business.*
General Motors will be executing a five billion dollar stock buyback in the near term.*
The soaring US dollar makes it the worst of times for big American companies with an overseas presence,said Larry Glazer of Mayflower Advisors.There's actually a shortage of stocks out there.You have to change your investment strategy.Ultimately,the strong dollar is a good thing,but a volatile currency is not a good thing.It is hurting the emerging markets.*
Small cap stocks,as well as domestically-oriented US companies and European stocks,which have not appreciated nearly as much as US issues in recent years,are being recommended in these conditions.Margins of the big multinationals are likely to be hit by the strong dollar.*
iShares Small Cap Core ETF (IJR),iShares S&P Europe 350 Index Fund (IEV),Qualcomm Inc (QCOM)

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