Don't Bet on Dinosaurs

Now that we're in the grips of a rally, don't bet on the dinosaurs.

I personally believe that we are seeing a substantial bear market rally, but let's say that you disagree. Even if you believe that we've seen the bottom and we're off to greener pastures, remember that extinction is forever. What you need to be looking for is the next new thing.

What brought us down will not be what brings us back. We only need to look back to the tech bubble nine years ago. At that time, you may have thought to stick with the so called best of breed. Perhaps you'd have stuck it out with the likes of Microsoft, Cisco, or Intel. Bad move. Their days had come and gone. Potential growth had been reached and Moore's law proved to be right enough to keep pressure on the chip industry. Had you waited until Google came along, you'd have found your missing link to future success.

In Today's market, beware the T. Rex's like Citicorp and Bank of America. The Fed's life support that has resulted in this latest rally will eventually run out of steam. After that, you'll be looking at years of stagnation at best, and extinction of your portfolio through either bankruptcy or boredom at worst.

You've often heard that investing is a long haul.
Don't buy the dinosaurs, let Neanderthal evolve, then buy the new "Best of Breed."