Summary:
My string of up weeks was broken at eight as I gave back about 6%. There was weakness all over, from China to dry bulkers to miners. XSI, CHNG, and FFHL were among my positions which imploded. Credit worries once again affected the general market and the high flying sectors I own were taken down with it.
I don’t feel the same bullish sentiment I did after the August washout, but once again I’m operating on sense of smell. Perhaps after the big runup I’ve had I sense the need for consolidation. On the other hand I feel very confident in the individual positions I own. I think almost all of them are good values. The one real except is FFHL, which is under a cloud after its main shareholders got arrested and its auditors quit. There have been no charges against the company itself so this is all a storm which could blow over but its hard to know. My position is now less than 1% — I’m letting it ride until further details emerge though my taxable position may become a tax loss sale.
This week I reduced my holdings of CHNG, MLKKF, QADMF, GMO, ANH and DRYS. Though I like the fundamentals on all of them, I think this downturn may continue for a while. I also got rid of QMAR, PRGN, and ERF, the latter because of Canroy concerns and sentiments that oil might drop in the short term. I added a good amount of NRF, a dab of SNEN and GA. NRF fell before earnings, which were very good, and at one point was yielding 18%. I think this is more than adequate compensation for a company which is in a tricky sector, but has liquidity and good asset. GA is a Chinese online gaming company. Good growth and fairly reasonable valuation. I took a small stake and it promptly fell. I may add when the markets look a little more sanguine.
Positions:
Long: ALSWF ANH ANH-A BWLRF CHNG CMO-A DEEP DRYS FFHL GA GMO GREXF HBMFF MDNNF MLKKF MMG NRF ONAV QADMF QMAR SNEN XSI
Short: GCI KBH MEG MNI TOL.
Options: long BQI Jan 2.5 call; short BQI Jan 5.0 call
Cash: 7.2%
Short Pct: 7.7%
Read:
Stocks Researched:
Positions most worried about: FFHL, dry bulkers.
Positions most sanguine about:
Biggest market worries: credit induced market downturn?
Thinking about:
Outlook ( up-flat-down surety rating: 1-5 reasoning):
US: flat-down, 2.0; credit woes.
Tech: ??
Japan: not invested – don’t care anymore.
China: up, 3.0; strong economy.
Silver: up s/t, 2.0, price action; l/t up, 1.0, industrial demand.
Gold: up s/t, 2.0, price action; l/t up, 1.0, industrial demand, GFMS study, US$ weakness.
Copper: flat-down, 2.0. China, but stocks rising.
Zinc: flat, 2.0. Stocks stabilizing.
Real life: back to the website project and trying to do some economics as well. thankful rest to social excitement.
Weekly sleep and exercise: soccer, biking. sleep decent.
Mood: calm, good
