This has been a very hard market. However, there are a lot of opportunities. The bad news bears might be alive and well, but the most important thing, is at the end of the day, to have a plausible strategy that doesn't wipe you out. The key is not to get wiped out. Easier said than done. Unfortunately, if my grandmother is right, we are headed for a Japan-like recession which will mean that I would be crushed 65-70% in terms of an 80-85% stock-level drop. I doubt that will happen since the FED lowered rates by increasing the money supply and we have tried to throw money into the system. We didn't ignore it like we did in 1931.
Status:
Portfolio-wide basis: Down 30.5%; up from a 40.05% loss
Tradeable Account basis: Down 46.97%; up from a 60.4% loss
I feel like I handled October well. I'm more afraid of missing the upside than the downside since I'm very early in the accumulation stage. I hope I'm not naive but even if this is 1937-1942, I will only be down 45%. I'm invested in 90% stocks and these are my sectors:
1) Emerging Market (EWZ)
2) Energy (RDS-B and XOM)
3) Financial (TROW)
4) Tech (AAPL + RIMM)
5) Biotech (IXJ + PBE)
6) Consumer Staples (PEP + PG)
7) Retail (XRT + PMR)
8) Defense Contractors (NOC + PPA)
9) Bonds (LQD)
10) Market (FDL)
(The order is subject to change). I expect to have industrial companies instead of emerging market companies; companies like UTX, CAT, and DE are of extreme interest to me. I am really enthralled with how cheap assets are right now, such as X, JCP, M, SLB, T, VZ, CELG, PEP, KO, UTX, RDS-B, XOM, MMM, and JNJ. There are such unbelievable opportunities and my fear is that not many people are going to be able to enjoy them.
Quote:
Originally Posted by Airelon
I've mentored people when it comes to either investing or trading (trading and investing are two different things). I had one guy tell me a very simple truth:
" Man, none of this is hard. It's just that there is a lot to know!"
He couldn't have been more correct. Just remember that in this business? A lack of knowledge can cost you your entire account in the time it takes to have read this sentence.
Study. Study. Study. Study money management principles and strategies, with the importance of proper position sizing. Learn what you have to learn, in order to get started. Learn how to get started, once you think you've educated yourself far enough along. I put together a playlist some time ago - as without a doubt, the question I am asked more than any other is: " How do I get started". |
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