Sunday, April 24, 2011

Still in a holding pattern

Sometimes the best strategy is to sit tight and wait for 'that' moment. That moment when panic selling sets in. We just find it hard to do much buying unless everyone else is selling. In the meantime, there are some relatively good places to park short term cash.

One of my favorite mutual funds for holding cash, TGMNX, pays about 7%. Also, we've been looking real hard at PFF which is an ETF investing in preferred shares and yields about 7%. Both should allow us to move from cash to riskier assets with ease.


Saturday, April 16, 2011

Getting a new plan together

As I stated earlier, we'd rather not be buying anything at the moment, instead we prefer a 'holding pattern' strategy. We didn't dump our core holdings, but we dumped everything else and currently creating a list of stocks we'd like to buy after a nice ugly pull back.

We're in a much different place than we were 2 years ago. It seemed easy picking winners a couple of years ago because everything was so cheap. Today's market separates the 'pros' from the 'schmoes'.

Buying the metal, iron ore, coal, and aluminum producers expecting a double in a year probably doesn't work going forward. We need a strategy with a bit more finesse. Early indications are more than 50% of our portfolio will be positioned outside of the US. For example, I'm thinking our core holdings that pay us fat divys will be US based, while our growth plays will be located in the BRICS and elsewhere.

We're working on a new 2013 Model Portfolio, but won't have it final until we get into a good sell off.


Saturday, April 9, 2011

Hello friends

Well, what a surprise, I'm back here pouring my thoughts on the market back on the web. I think I needed the time off. Much has happened in the past 6 months. Some of the stock I loved, I now hate and some I didn't like, I now sort of like.

The 2011 Model Portfolio performed nicely over the past 2 years and some of our biotechs were big winners, while some were just wieners.

Those of you that held on to Cliffs (NYSE: CLF) and Freeport (NYSE: FCX) should be celebrating. The foundations of our long term retirement portfolio have performed a little better than I even thought, like Verizon (NYSE: VZ) and Bristol-Meyers (NYSE: BMY). Huge yields and both are up nearly 30% from where we recommended them. We still hold VZ and BMY of course.

This market still seems to be primarily driven by something other than fundamentals and there are still some great long term deals out there which I find surprising, like Intel (NASDAQ: INTC) and Cisco (NASDAQ: CSCO). INTC has a yield of 3.5% and CSCO is yielding 1.5% and both could trade in the up 20's within the next year. INTC is still in the portfolio. INTC under 20, hmmm.

Vivus (NASDAQ: VVUS) and Arena (NASDAQ: ARNA) didn't fare so well, but the last chapter hasn't been written in that comic book yet. Remember, these stocks are concentrated equities, so a little goes a long way. You can hold a little and wait this thing out without betting the farm.

For the record, we also still hold GE and Petrobras (NYSE: PBR). PBR is actually paying almost 4% right now, ignore what you see on yahoo as far as the yield. We sold a lot of other things. Although, we still hold a little VVUS, ARNA, and DNDN (very little for the long haul). A little spice for the portfolio. There's very little else we like right now, as this market is in 'no man's land'. There's no way we continue to rally. At some point in the very near future, the bears will have their days, which will likely be weeks and 15%. The patient investors wins. Remember, sell high, buy low and never chase.

Will report back later.


The Vix

About This Blog

Where we rant and rave about the market and of course give our opinions on stocks we love or hate. We're not advisors and urge you to conduct your own due diligence.

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