wow where did that 6 months between posts go?
its been awhile so I realize if I had any readers they are long since gone. oh well. I got swamped trying to deal with the market, my job (laid off as of mid march) and other issues (2nd child born in early January). I made lots of changes to the portfolio in the last 6 months. some stocks I chose to let go while I held on to others but at reduced position sizes. The following stocks remain in the portfolio at their pre meltdown share count:
1. UEPS - missed this one at $8 -- what a fall during the Oct/Nov time frame as clearly some hedge fund was liquidating their position. I knew that $8 was a ridiculous price given their cash flow and cash on hand -- worked out to just a few times free cash flow. Yet I didn't add to my position because if $8 is ridiculous why wouldn't $5 be even more ridiculous and why wouldn't the price continue lower? too many forced sellers who don't care about price were driving UEPS' price down and what was going to change that dynamic? no idea. holding on worked out since the stock remained above its oct/nov low during the feb/mar sell off -- at $15 recently, its doubled off its lows.
2. MMP and AB -- MLP's so the tax consequences are huge for selling. MMP has the best balance sheet of all the MLPs. AB is my upside hedge -- if things work out that stock will take off and offset the defensive nature of the rest of the portfolio. I continue to think these 2 will do fine.
3. TECH -- while I should have sold some when it rallied to the mid $60's because the valuation was at ridiculous levels but the business is still a very good one even though the stock has dropped to the mid 50's.
Those stocks we sold out of completely:
CME -- got out at $360 to $400 because there was just too much risk that volumes would collapse in a bear market and that fixed income related futures needed the credit markets to return to pre aug 2007 type leverage and derivatives usage for the earnings to grow. would rethink about buying below $200.
FDS -- buyside revenues down 40% so labor costs have to drop to be competive.
its late -- have to finish up later. lots of thoughts on our new socialist government as well as direction of economy etc.