Have Faith in Some of the Large Cap Stocks

Physician's Money Digest, February 2006, Volume 13, Issue 2

Investor's Business Daily

For physician-investors interested ingrowth, investing in large cap stocks doesnot seem like a very exciting route to travel.According to ,some large caps are simply crawling along,such as Verizon Communications,while some are losing considerableamounts of money, such asGeneral Motors. However, thereare still some flagship companiesthat are experiencing growth andare worth considering. Apple Computer,for example, has experienced a 3-year earnings growth rate of 36%, and thestock is roughly 10 times what it was inMarch 2003. Google is another big companythat has surged recently, up nearly 5-fold since its initial public offering. Oneadvantage that large caps hold over smalland mid caps is more liquidity. Big blocktrades tend to have a minimal effect on theprice of large cap stocks, which attractsinstitutional investors to buy bigger positionsin them, thereby decreasing volatility.