I’ve been chopping back my portfolio. I’m really bearish of the market right now. Even when I see a stock I want to buy, I’m holding off. I’m about 50% in cash. That is extremely rare for me to be that “out of the market.” So what am I holding?
It’s hard to look like a genius in a bear market. This is exactly where we are today. Bear markets don’t last forever and nor, sadly, do bull markets. You look like a fool in a bear market and like a professor in a bull market, the trick is to not do too badly when markets slump and to do really well when they rally.
OK so I’m a contrarian and as such I am now long blinkx (BLNX). I bought three times on the day of the crash in my mad punting account. (I have this to remind myself of the pain of self-immolation in trading, so I don’t lose track of my customers.) I bought at 40p, 33p and 29p averaging out at 34.1p. Basically, this is where it sits right now. I think it is going up.
I am 47% ahead on this tip already but shares in Total Produce (TOT) are, at 89p, still cheap. I see 50% more upside and here is why.
A couple of years ago I was on stage with Evil Knievil and I ended up pointing out to him numerous times that he doesn’t get “internet companies.” I recall he was happy to admit it.
I often get stocks in my portfolio being bid for. Let me explain why. Shimple Peoples…if you buy a company when its shares are cheap, you are not the only one thinking that it is a good buy. Private equity can come calling and so can a competitor.
My value investing newsletter is proving rather popular which is very gratifying. It might be because we made about 25% in the first year or so while building a portfolio of 18 shares even after paying tons of brokerage/spread and stamp duty costs. And it might be because I put my money where my mouth is and so here is a stock I have been buying of late and am trying to buy more of: Arcontech (ARC). Here’s why.
As a value investor, buying and selling is not about time, it’s about price. This means that while you can appear a trading genius and buy moments before a share rockets, other times it can take weeks, months or years to come good.
Underneath my classic value investor coat there is a contrarian value investor trying to get out. As such when I see deep value I want to buy it. Conversely when things go well I feel is time to sell.
Most people think a tip should be a “rush out and buy it” kind of thing. “Buy ABC now it will go to the moon.” Well this double share tip is the opposite, it is to wait and see and sell.
