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The "Back To School Sale" For Tech Stocks

Friday, 19 Sep 2008 | 9:28 AM ET
Teck Stocks
CNBC.com
Teck Stocks

With this morning's rally, this is quickly shaping up as the week that wasn't for so many battered and bruised technology companies.

And whiplashed investors are learning some important lessons: buy low and sell high; try to stay patient; don't sell unless you have to; think long term, or certainly longer term than lunchtime later today; and losses aren't real until you realize them by selling into the frenzy.

And what a frenzy this was. So many of us have been beating the fundamentals drum, that the sweeping downdraft on Wall Street didn't make a lot of sense as it related to the bigger stars of tech. There simply was no reason why Applewould be blown apart along with Lehman, WaMu, and all the financials. Or RIM, or IBM.

Just last week, days apart from each other, I sat down with Steve Jobs and then Jim Balsillie.Both expressed surprise and satisfaction that Apple and RIM respectively were still doing so well, even in an economy like this one. That their fundamentals were strong. Heck, Apple's sitting on over $20 billion in cash, and RIM's closing in on $3 billion.

These are healthy, growing, innovative, dynamic companies with enviable balance sheets. And yet they were crushed. Apple careening its way to $120. RIM dipping well below $100. And now the climb back begins.

Choosey, smart investors with an eye for quality, and some money to spare, doubled up on these companies earlier in the week and they're the ones who will be buying dinner for friends tonight and laughing quite literally all the way to bank. Assuming their banks are still in business.

I'm not saying we're totally out of the woods yet. Or that you should blindly throw money at the market and all things tech. Or that volatility won't continue. Markets move in two directions. When they're up, they can slide. When they're down, they can climb. Short term "traders" can get squashed if they don't time it right. Longer term "investors" look back at these periods and may not even remember them.

Fundamentals. A lot of these companies were strong last week, and they're still strong this week. And this week, they went on sale. I hope you got a chance to pick up some bargains. If not, next time. That's one thing that is certain: I can assure you, there WILL be a next time.

Questions? Comments? TechCheck@cnbc.com

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