Beefing up Tech with Akamai and Marvell
Increased my tech exposure yesterday by adding to my position in Akamai Technologies, Inc. (AKAM) and started a position in Marvell Technology Group, LTD. (MRVL). I’m going with the idea that tech season lasts only from Labor Day to Thanksgiving, so every week that goes by are missed gains and a smaller and smaller window before Thanksgiving.
I was trying to time the mini pullback to get in on tech. Well, I got the day right (assuming we get a continuing rally after the Fed decision on rate hikes is a non-event like many people think), but got the time of day wrong. I’ll have to write a post about this lesson learned, but basically the lesson is NEVER TRADE BEFORE 10:30AM! Yes, I caught the down day after a week straight of up days, but I bought too early when the orders between the market closing the previous day and the market open were still flooding in. I’d say these orders were put in before any of the day’s actual news and action began, so it doesn’t tell you anything about the direction of the day: up or down.
I bought Akamai Technologies, Inc. (AKAM) at $45.05 Marvell Technology Group, LTD. (MRVL) at $20.75, but of which immediately went down with the rest of the market. Akamai Technologies, Inc. (AKAM) went down to about $44.00 and Marvell Technology Group, LTD. (MRVL) slid all the way down to $19.80! Sure, I’m not a day trader so these daily ups and downs shouldn’t matter, but it’s always nice to get better price and I knew it was going to be a down day neway. Another failure on the patience test and waiting to see what the market gives you, not jumping on what you want. I suppose I was rushed and got too emotional wanting more tech right then and there, especially since I was expecting Oracle Corporation
(ORCL) to report a great number (which it did) and boost the whole tech sector today (which it is).
Akamai Technologies, Inc. (AKAM) is my favorite tech company and stock right now. They basically free up traffic for websites, especially those with a lot of traffic like video, music, or shopping sites without the companies having to buy a lot of extra equiptment to upgrade their system. Akamai’s system is essential for companies moving their stuff online, and I know you know what I’m taking about as you’re surfing the web now. I don’t think Akamai will take a breather for at least a year, but I’ll write an indepth overview of Akamai later.
Marvell Technology Group, LTD. (MRVL) is the perfect way to play hand held devices like Apple’s iPod and Microsoft’s Zune music players, as well as cell phones and PDA’s. I wrote in the last post about how I bought some stock in Apple Computer, Inc. (AAPL) and how great the outlook for these tech gadgets will be in the coming months. I should’ve just bought Marvell instead as it should benefit from Apple and outperform Apple.
Akamai Stories:
- Akamai See Strong Revenue Growth; Analysts Raise Targets
- Akamai Threatened by Limelight Networks’ Growth
Marvell Stories:
**Disclaimer: I own shares of Akamai and Marvell as of this posting**
October 1st, 2006 14:08
Just wondering why does Marvel go up with iPods and Zune whatevers. How do you know Marvel bits are inside the boxes? Or is that not important?
thanks
October 15th, 2006 20:56
Well, Marvell’s stock doesn’t necessarily go up or down exactly with the sales of iPods and Zunes, there are other factors that affect the stock. Like right now Marvell is down a lot because they had some accounting issues for their stock options so they might have to say they actually earned less than they were telling us investors. In other words, they might not be doing as well as they told us. But back to your iPod Zune question, Marvell makes these computer chips called controller chips that they use in iPods, Zune, and all those video game systems. The controller chips act basically like stop signs and such, they control the traffic in iPods, Zunes, and video game systems so that these devices work right instead of having “traffic jams”. So if a lot of iPods, Zunes, and video game systems are being sold, that means Marvell’s chips are being sold along inside them, so Marvell would make money. I know it’s a little long-winded, but hope it helps.
October 16th, 2006 19:19
One of the best overview of Marvell is this article by Forbes Magazine: http://marvell.com/meet_marvell.pdf. But again, this article is a few months old, so I can’t be 100% sure Apple is still using Marvell chips. I do know Microsoft’s Zune is using Marvell chips. Since Marvell has a major advantage on its competitiors (~20% faster) and dominates the market, (I think something like 90% of the type of chips they make), I see no reason why Apple would use someone other than Marvell. Also, if Apple was using Marvell chips in August (at which time they were already making the new iPods), they’re probably still using Marvell chips. That’s the best I got, thanks for visiting my site and for the questions.