Pfizer News

Pfizer (PFE) just announced it will only earn $2.00 in 2005 instead of the $2.13. The initial pre-market reaction was for the stock to lift a little.

Pfizer has had a brutal run of bad news. I forget who, but someone years ago taught me that bad news begets more bad news. Think Fannie and AIG. Often, owning these stories is more trouble than its worth. It does not serve my clients goals to try to cherry pick a bottom in, say, Merck.

I realize that my approach is quite conservative but I don't need the hassle of trying to game this stuff. At some point the story may turn and the companies might be attractive investments again. In the mean time I just think investing can be easier than this.

On a different note have you heard of the SPDR O Strip (OOO)? The components of this are all the Nasdaq stocks that are members of the S+P 500 so OOO is thought to be a proxy for tech. The thinking was that this would appeal to professionals as a hedging device. The average volume has been 28,000 shares per day. Oops. If you look at the option chain you can see some large open interest in a few series that imply, to me, that there is some hedge utilization.

Did the market need another large cap tech proxy?