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Stock Strategist

Our Outlook for the Software Sector

This sector offers enticing opportunities for long-term investors.

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It is no secret that the software sector, in general, has recently been a safe haven for investors looking for firms with limited exposure to the subprime mortgage industry. The Federal Reserve interest rate cut has brought a temporary jolt of cheerfulness to the market, placing subprime concerns on the back burner--at least for now. Nonetheless, as companies start reporting third-quarter results in the upcoming weeks, their true exposure to the subprime market will become clearer. Doomsday feelings are likely to feed Mr. Market's fickle temperament.

Rafael Garcia does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.