Forum OpenACS Q&A: Good Linux Stock Investment

Posted by MaineBob OConnor on 12/15/01 02:48 PM

Ok, this may not be the right place to ask the question but I have a friend with some money to invest in stocks and he wants to invest in a public Linux company. I am asking this group because I believe you Know and Love Linux. The only company I could think to recommendwas IBM because of their "Billion Dollar" investment in Linux.

Thank you.

-Bob

"Happy Holidays. Live long, and prosper."

2: Response to Good Linux Stock Investment (response to 1)

Posted by Jonathan Ellis on 12/15/01 05:15 PM

That's the only company associated with linux that I'd be willing to take a chance on, too. :)

3: Response to Good Linux Stock Investment (response to 1)

Posted by S. Y. on 12/15/01 07:18 PM

I'd invest in IBM, but for reasons unrelated to their "Operating System Du Jour". After all, IBM was the company that brought us OS/2 Warp. IBM will survive even if the Linux revolution doesn't happen. Looking at their multiples though, IBM's share price might be a bit high so investing in IBM might not be the best short-term performer, but since your friend is asking you to solicit investment advice from the public Internet...

Generally speaking, their financials are pretty clean, their management isn't totally lame, and they still pay out dividends (even if the yield is something like 0.46%). IBM is the type of stock you put in your IRA and forget about.

I don't know what sort of return on investment he is expecting, but the days of VA Linux's wild rise are history.

4: Response to Good Linux Stock Investment (response to 1)

Posted by Marc Spitzer on 12/15/01 08:11 PM

Well I think your friend is asking the wrong question. He should be asking what would make me money, if Linux does that great. Now if your friend is like me, not a knowledgeable investor, I think he would be better off in a low cost mutual fund, vanguard has a bunch of cheap index funds to look at, www.vanguard.com . Vanguard also has a lot of educational reading available on it site about funds in general. If he likes reading books here is one on funds "Bogle on Mutual Funds: New Perspectives for the Intelligent Investor", ISBN 0440506824. And here is one on stocks "The Intelligent Investor", ISBN 0060155477. Intelligently investing in funds is MUCH less work then doing the same for stocks.

I wish him the best of luck, but if he has not done his home work he would probably be better off sticking it in a CD.