Local stock experts wary


POSTED: Monday, March 09, 2009

Can the stock market get any worse?

With the Dow Jones industrial average down more than 50 percent off its October 2007 high of 14,165, investors have to be wondering whether it's too late to bail or is now the time to do some bargain hunting.

Four Hawaii stock experts, who are back again for the eighth annual Star-Bulletin survey of best investment ideas, say being selective is paramount since the recession still may have a ways to go.

Norm Caris, managing-director-institutional sales for Caris and Co., is back to defend his crown after his hypothetical $20,000 portfolio lost just 13.2 percent in 2008 in a devastating year for the market.

He is joined by the other three participants from last year as well. They include Barry Hyman, vice president-managing team for the Maui branch of FIM Group Ltd. (down 23.4 percent); Dwight Melton, co-founder of the Hawaii Stocks and Options Group (off 35.9 percent); and Richard Dole, chief executive of Honolulu investment adviser Dole Capital LLC (off 46.9 percent).

All the experts made their first-quarter selections at the start of this year.

Caris, who lives on Kauai, says that now is the best time to own bonds.

“;Pimco High Income Fund is the best bond play I'm aware of,”; said Caris about one of his 2009 picks. “;It is run by the best bond managers in the country. There is $8 trillion in money market funds getting just about zero return right now and I think some of that money is going to try to find yield.”;

Melton, a three-time champion, put all of his portfolio money in iShares Barclays 20+ Year Treasury Bond Fund.

“;I think fixed-income instruments may be the best bet,”; he said.

Dole said it's likely that level heads will prevail and the stock market will recover long before the economy does but, at the same time, he adds that he doesn't expect much of a recovery until the banking crisis is solved.

Adds Hyman: “;This is an environment where security selection and management may be of critical importance.”;


Best investment ideas of 2009

Hawaii stock experts began the year with a $20,000 hypothetical portfolio:



Caris and Co.
Managing director for institutional sales
2008 return:



































































CompanyTickerSector2008 CloseShares2008 Total returnStarting value



Hawaiian HoldingsHAAirlines$6.38600+25.1%




Collective BrandsPSSShoes / Apparel$11.72350-32.6%




Pimco High Income FundPHKGovernment securities$5.53700-46.1%




Research in MotionRIMMMobile communications$40.58100-64.2%












Total     $20,000.00


FIM Group Ltd.
Vice president of management team
2008 return:



































































CompanyTickerSector2008 CloseShares2008 Total returnstarting value



United OnlineUNTDWeb portals$6.07659-45.1%




Cheung Kong Ltd.CHEUYHong Kong developer$9.46423-47.1%




Dow ChemicalDOWChemicals$15.09265-59.2%




Tree.comTREEFinancial services$2.601,538-64.5%




U.S. Global InvestorsGROWInvestment management$4.89818-70.0%













Hawaii Stocks and Options Group
2008 return:































CompanyTickerSector2008 CloseShares2008 Total returnStarting value



iShares Barclays 20+ Yr. Treas. Bond FundTLTGovernment bond fund$119.35167+33.9%













Dole Capital LLC
Chief executive
2008 return:



































































CompanyTickerSector2008 CloseShares2008 Total returnStarting value



Procter & GamblePGConsumer products$61.8270-13.8%




PfizerPFEMedical / drugs$17.71225-16.9%




Alexander & BaldwinAXBOcean transportation / real estate$25.06150-50.0%




Bank of AmericaBACBanking$14.08300-63.1%




Shaw GroupSGREngineering$20.47175-66.1%













*Cash is the highest rate listed by Bankrate.com at the end of the quarter. Note: Total returns and stocks that are sold include reinvested dividends