I Won't Back Down

At the beginning of the week  I started to worry that EU officials were doing too little. While I reduced my net long exposure very modestly as a result of those fears, in 20/20 hindsight I wish I would have done more.

I believe after the worst week since 2008 it is now too late to sell. I added a position in UPS and some SPY CALLs  and am ending the week in a larger net long position than I started the week with. It is not lost on me that the bear case seems very compelling right now, but it always does after the market has already gone down. Have a great weekend.

1 comment:

frank r said...

I'm up to 50% stocks, from a starting point of zero on Aug 23, when I returned from vacation. I wouldn't call myself bullish. But I see no reason to hang around in bonds anymore and cash also stinks, so that leaves stocks as the best game in town. I'm just sorry the market didn't crash some more and give me a better price. But I couldn't stand waiting any longer and so gave in yesterday and today and bought heavily. There seems to be a lot of support around 1120 on the SP500.

About 33% of what I bought was European stocks (Vanguard VGK index ETF). Only bank in the top 10 holdings is HSBC. As of 8/31/11, overall portfolio PE is supposedly 10.8x (I assume ttm), P/B 1.4x, 20% return on equity, -.1% earnings growth rate. The PE is low because of all the oils (Royal Dutch Shell, BP, Total). A lot of bad news appears priced in.