Rainmakers May Look To Cloud For Investments, For Now

Here's one I started last week: I filled a hypothetical market basket of stocks in six companies with significant cloud computing strategies to see how they would do. I invested a hypothetical $1,000 (or thereabouts) in each of those six companies.

The market tends to vote with its dollars. I wanted to know if it's casting any votes for cloud computing.

The stocks in the basket include Google, Rackspace, Terremark Worldwide, Qwest, Equinix and Salesforce.com. Each was chosen because a significant part of their business and strategy includes cloud applications, cloud hosting or cloud infrastructure. The selected stock price was their opening price on Nov. 13.

Through Monday morning, those stocks had risen by as much as 5.4 percent. That's 5.4 percent in a day and a half, although there was a slight pullback to about 5 percent as the morning wore on. (Rackspace and Terremark, which both made presentations last week at a Goldman Sachs conference in New York, were up by 10 percent and 11 percent, respectively, since Friday.)

To put it into perspective, consider this: For the Dow Jones Industrial Average to have advanced by as much as those cloud stocks, it would have had to have gained 500 points since Friday. So even though the Dow was up by about 130 points on Monday morning, over the last couple of days it's seeing nowhere near the enthusiasm of these six cloud stocks.

Time will tell if the financial market's investments in cloud computing will continue. As the stocks rise, there will be closer attention paid to things like debt load, price stability, P/E ratios -- items that hype can't cover. But for now, investors seem to like what they see. At 5 percent returns in a couple of days, who can blame them?