LAFAYETTE INVESTMENT CLUB11/05/10

AGENDA CLUB news FINANCIAL news PORTFOLIO overview SECTORS sign up! WHAT IS AN ADR? BAIDU presentation (vote!)

CLUB NEWS SOLD TY, BOUGHT VESTAS WALL STREET 2 – good time! SPOT party - not too many people showed up Next meeting: next Friday, Nov 12th Trip: Thu, Nov 11th DeSales University–

Art/Business Conference, sign up with Career Services

Speaker: Holly Paul ’94, PWC, Monday, Nov 15th Oechsle Hall

FINANCIAL NEWS High Unemployment - 9.6% (Stable/Stubborn) ECI Wages and Salaries: just over 1.5%, slow and relatively

stable recently Retail Sales: very strong recently and for quite a while Profits & Earnings have been large + new orders also

strong. Consumer Sentiment: 67.7, has been on a downward

Trajectory Consumer Spending: Slow Growth GDP Growth: Slowing down Housing Sector: BAD!!! Home sales(both new and old)

remain weak Inflation Subdued (Core PCE:1.4%) Inflation Expectation Fell in Sept

MIXED !!!

WHAT’S NEW THIS WEEK QE2($600 billion of U.S. government bonds)

Stock (Dow Jones Up by 1.96%, SP 500 up by 1.94%)

Inflation Expectation just turned to rise

PORTFOLIO Total AUM: approx.

$350,000 Cash: approx. $30,

000 Beta = .89 (up from .81)

Number of positions: 42

PERFORMANCE

• S&P 500 YTD 8%

• Portfolio YTD approx. 8.5%

TOP 11 HOLDINGS

INTERNATIONAL BUSINESS MACHINES IBM 125 $146.79 $18,348.75 5.16%CATERPILLAR INC COM CAT 200 $83.18 $16,636.00 4.68%KINDER MORGAN MANAGEMENT KMR 245 $62.54 $15,349.92 4.32%AKAMAI TECHNOLOGIES AKAM 250 $53.63 $13,407.50 3.77%GENERAL ELECTRIC GE 800 $16.51 $13,208.00 3.72%T ROWE PRICE INTL EMERGING MRKTS PREMX 928 $13.86 $12,856.23 3.62%EXXON MOBIL XOM 170 $69.38 $11,794.60 3.32%VANGUARD LONG TERM FD VBLTX 908 $12.70 $11,528.55 3.25%JOHNSON & JOHNSON JNJ 175 $64.76 $11,333.00 3.19%AMGEN INC AMGN 200 $56.01 $11,202.00 3.15%ISHARES BARCLAYS 1-3 YR TRS BD SHY 118 $84.46 $9,966.28 2.81%

TOP PERFORMERS SCCO (PCU)

147% DBB

104% IBM 85% AKAM

85% KMR

64% CAT 43%

WORST PERFORMERS BAC (only .7%)

68% MFC

44% GE

33% BA

19% INTC

17% GILD

16%

HOW MUCH DID WE MAKE YESTERDAY?

$6,178IN A DAY

SECTORS

TMT (TECH, MEDIA, TELECOM)

ENERGY & COMMODITIES

FINANCIALS

HEALTHCARE AND BIOTECH

CONSUMERS AND INDUSTRIALS

ACTIVE MANAGEMENT Markets have experienced a high correlation Reasons: ETFs Macro driven trading

=> PICK A SECTOR and follow it => MAKE GROUP PROPOSALS ON

SECTORS

SECTORS – PLEASE SIGN UP! TECHNOLOGY FINANCIALS ENERGY HEALTHCARE CONSUMERS

WHAT IS AN ADR?

COMMON STOCK Represents a share of ownership in a

corporation Can be traded on exchanges (NASDAQ,

NYSE, etc) Can be traded OTC (in the “Pinks”)

OTC/PINK SHEETS Companies that are small May not meet exchange requirements Possibly doesn’t meet SEC

requirements

ADR American Depository Receipt Issued by foreign companies Traded on US exchanges Price based on home country price Allows many benefits of ownership Exposes buyer to currency risk

BAIDU VS GOOGLE BIDU 110.06 -0.59 (-0.53%)

Range 107.10 - 112.55 52 week 38.47 - 113.78 Open 112.09 Vol / Avg. 13.97M/14.10M Mkt cap 38.34B P/E 91.85 Div/yield     - EPS 1.20 Shares 348.33M Beta 1.79

GOOG624.27 +4.09 (0.66%)  Range 622.10 - 629.92 52 week 433.63 - 629.92 Open 624.62 Vol / Avg. 3.57M/3.52M Mkt cap 199.63B P/E 25.26 Div/yield     - EPS 24.71 Shares 319.78M Beta 1.21

BAIDU VS GOOGLE