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Law Of Averages: Winners & Losers In Web Stocks 1997

Written By

Jan 2, 1998

2 minute read

If you had invested $532.83 for one share of each of the stocks in ISDEX at December 31, 1996 closing price (or IPO price if not trading then) that same basket of shares would be worth $792.28 on December 31, 1997.

On average you would have paid $15.22 per share for the lot worth an average $22.64 at year’s end. That’s a 49% simple weighted average gain, far better than the Dow, Nasdaq and S&P.

Said another way, even though half the stocks shown posted losses, the winners won enough to more than offset this. In fact, the top 10 stocks were up triple digit, carrying the fallen from grace at the bottom of our year-end analysis tally.

Sure, the geometric average of ISDEX showed only a slight upside for the year. A geometric average weights each stock equally in order to level the playing field of small and larger caps. In doing so it serves as a barometer of the big picture, the overall sense of where Wall Street meets the Web, and not a portfolio manager method of accounting for ups and downs, the dollars gained and lost on the roller coaster Internet investment vehicle.

Here’s the percent and dollar-value changes locked in from December 31, 1996 to December 31, 1997:

Following The Money: ISDEX 1997

*ISDEX ®*	*Ticker*	*31-Dec-97*	*% change*	*Point*	*31-Dec-96*
*Internet Stock Index*	*symbol*		*from*	*change*
		*close*	*31-Dec-96*	31-Dec-96 to	or IPO *
			or IPO *	*31-Dec-97*
ISDEX Average		99.87	0.4%	0.37	99.50
NASDAQ		1,570.35	21.6%	279.32	1,291.03
DJIA		7,908.25	22.6%	1,459.98	6,448.27
S&P 500		970.43	31.0%	229.69	740.74

(sorted by most % gained)
Yahoo!	YHOO	$69.25	511%	$57.92	$11.33
Mindspring	MSPG	$33.63	449%	$27.50	$6.13
Lycos	LCOS	$41.38	294%	$30.88	$10.50
VocalTec	VOCLF	$20.50	249%	$14.63	$5.88
Amazon.Com *	AMZN	$60.25	235%	$42.25	$18.00
Onsale *	ONSL	$18.00	200%	$12.00	$6.00
Excite	XCIT	$30.00	193%	$19.75	$10.25
America Online	AOL	$90.50	172%	$57.25	$33.25
@Home Network *	ATHM	$25.13	139%	$14.63	$10.50
E*TRADE	EGRP	$23.00	100%	$11.50	$11.50
Earthlink Network *	ELNK	$25.75	98%	$12.75	$13.00
Open Text	OTEXF	$13.38	95%	$6.50	$6.88
CheckPoint Software	CHKPF	$40.75	87%	$19.00	$21.75
Netcom	NETC	$24.00	85%	$11.00	$13.00
CMG Info	CMGI	$30.25	81%	$13.50	$16.75
Forefront	FFGI	$7.81	42%	$2.31	$5.50
Infoseek	SEEK	$10.75	39%	$3.00	$7.75
Mecklermedia	MECK	$24.88	26%	$5.13	$19.75
Security Dynamics	SDTI	$35.75	13%	$4.25	$31.50
CNET	CNWK	$29.50	2%	$0.50	$29.00
Trusted Information Systems	TISX	$10.00	-7%	-$0.75	$10.75
Versant Object Technologies	VSNT	$13.81	-26%	-$4.81	$18.63
Network Solutions *	NSOL	$13.13	-27%	-$4.88	$18.00
Open Market	OMKT	$9.63	-29%	-$3.88	$13.50
Individual	INDV	$4.25	-29%	-$1.75	$6.00
Security First Net Bank	SFNB	$7.25	-29%	-$3.00	$10.25
Raptor	RAPT	$13.25	-34%	-$6.88	$20.13
CyberCash	CYCH	$12.69	-45%	-$10.31	$23.00
CKS Group	CKSG	$14.13	-49%	-$13.75	$27.88
PSINet	PSIX	$5.13	-53%	-$5.75	$10.88
NetManage	NETM	$2.81	-53%	-$3.19	$6.00
Netscape	NSCP	$24.38	-57%	-$32.50	$56.88
Spyglass	SPYG	$4.94	-61%	-$7.56	$12.50
Quarterdeck	QDEK	$1.63	-61%	-$2.50	$4.13
Connect	CNKT	$0.84	-86%	-$5.28	$6.13
*TOTAL*		*792.28*	*49%*	*259.45*	*532.83*
*SIMPLE AVERAGE*		*22.64*			*15.22*

Law Of Averages: Winners & Losers In Web Stocks 1997

Following The Money: ISDEX 1997

Steve Harmon

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