Please do not take this the wrong way but I would like this discussion to be for serious and seasoned investors only. It will benefit everyone involved if the discussion remains in the realms of more seasoned investors as discussion will not get sidetracked into "What's your favorite penny stock?" "What stock will double tomorrow?" ect, ect. If you are unsure why you're portfolio is the way it is then please sit this one out and read and learn. It will be far more beneficial.

On to the question of the day... How are you managing your portfolio and why?

I'll start by saying that I put the majority of my assets in stocks about 3 weeks before this rally began, and I have stuck with it. Just recently I decided the risk was starting to outweigh the reward, and I felt it was time to hedge my portfolio. First, I shifted roughly 30% of my portfolio to cash. Second, I had to decide what to do with the remainder of my portfolio. I narrowed it down to three choices:

1. Don't touch a thing and simply maintain my small-cap long positions.
2.  Stick with #1 but also hedge my risk by shorting companies I felt were over-valued(to do this I would have to draw from my cash)
3. Sell off all my long positions, allocate 50% of my portfolio to cash and go short with the other 50%.

Ultimately, I have decided to go with #2. I am feeling bearish, and I feel the reward of a continuing rally is greatly outweighed by the risk of a significant correction. I have however been wrong so in an effort to benefit from either a continuing rally or a correction I have chose #2. My thought process is as follows:

My current stocks are all issues I believe will not suffer dramatically from a significant correction in the U.S. market. If the U.S.  market does start to downtrend I believe the gains in my short positions will outweight the losses in my long positions. If the market continues to go up I believe the gains from my long positions will outweight the losses from my short positions. In summary, I hope to achieve a win-win situation for myself by going long stocks that will outperform in both a bear and bull market which along with my short positions will enable me to profit from either.

As for what I am shorting? Nothing right now actually. I've been working on my revised portfolio this past week, and I plan on initiating my positions before the weeks end(barring any significant change in heart for some reason).

How about you? Are you bearish, bullish, or sitting on the sidelines and how are you structuring your portfolio accordingly?

 I want to sell into the few remaining feeble upturns and get to 50 percent cash. I've already bought and sold inverse etfs like SDS, and may hold SIJ for longer periods. I am not familiar enough with the technique called 'shorting' and hate to pile on some poor company and rather would short the herd mentality of the Bulls that got us into this mess which is why I find SIJ a nice way to go in a downturn. (besides not having to cover and retain margins). I feel it's sort of like the first two months of the year again.

Even my 'good' stocks I might sell to buy back at lower prices. T is a good one and maybe WMT, (some others)  but I might sell them too. If I can rebuy at 15 percent cheaper. Going to sell most of the banksters probably.

Only down to 15 percent cash. You were smarter to get there before this.

(I am now sure I have a bit of a stockaholic problem....even if a "bear", I have hidden optimism that makes me want to buy, buy.)

"If the U.S.  market does start to downtrend"


 I don't know, but it feels it's been going down for a month already. We're like the frog in the slowly heated up water, enjoying the heat and falling asleep, then suddenly being boiled w/o knowing it.

Hearing and seeing Cramer and Kudlow grow ever more shrill and scowling, while being "optimistic" about the market, only confirms Roubini's calm smiles.

But I'll be open to growing stocks too. That's why the need for cash to invest in the future.

    It is no secret to anyone who has been following the TK community that I sell puts to buy stocks and sell calls to sell stocks. This strategy results in my garnering a 3-5% return on both ends in theory. This leads to minimizing my losses due to the premiums I recieve. On the whole it works acceptibly well. Snce I have been following this strategy, I have been doing very well.

    There is another benefit to this strategy. It maintains both buy AND sell rules. While I did get eaten alive in march (like every other bull), I did minimize my losses. However, on the whole, the discipline this strategy imposes on both buy and sell side is a benefit. I buy at MY price, and sell at MY price. Most of the losses I incurred was by utilizing high risk positions (GM is a notable exception).

  Oh! Malign Cramer all you want, he did make me money. Do not blindly follow his picks, follow his advice (Buy and Homework). Do your own research, and own your own gains!

~~Weird Uncle Jesse~~

PS How do I lose these very large reply boxes?

incubus said: Though I understand the "what's your favorite penny stock " statement, I wouldn't completely close doors to alternative trading styles or strategies.
I swing trade with ETF's, it's much less risk than individual stocks.
I generally avoid hype, penny stocks and by and large individual stocks as a whole.
Last fall I lost a lot of money buying stocks after reporting fantastic earnings, I later learned that these stocks might have been specifically targetted by deleveraging hedge funds as a way to make fast money from a gazzillion guys like me who may have thought they were buying something with a future.
I even recall Michelle Caruso-Cabrera and another reporter commenting on this one night in Novemeber, that the higher quality stocks, especially those with good earnings reports, where getting slaughtered more then the overall market.
Also, we're in a strange time, where industry giants, staples for many years, can fall at a moments notice...if I can't trust companies like BA, BAC, C or GE, I'm hard pressed to trust smaller caps, not in this economic environment.
I also allow myself "play money", where I will occasionally dabble with a spec, this past week I shorted DNDN at an average price of $25.90 and covered the bulk of those shares yesterday, credit goes to Livin' for throwing the idea at me, and I bought into MTXX at 3 different intervals at $6, $5.46 and last at $4.40...this one's a hold for a few months I figure, until the next up swing, I'll buy in increments of -20% from here on in, if it dies, the amount I put into it is negligable.

 I thought you'd like that one Mr.Incubus ;]

Ven, swing trading isn't necessarily any more lucrative than buy and hold or long term trading strategies...the biggest factor is probably having the freedom to buy or sell when your ship comes in.

incubus said: Ven, swing trading isn't necessarily any more lucrative than buy and hold or long term trading strategies...the biggest factor is probably having the freedom to buy or sell when your ship comes in.
If memory serves, you're in school, your strategy is best suited for your lifestyle....and it has obviously proven to be lucrative.

 
Even when I do graduate, swing trading will never complement my lifestyle.

Well shoot, get that performance back up! Everyone has cold streaks, lol.

I'm majoring in corporate finance and my avi pic was taken at The Great Wall of China. Amazing place, I recommend everyone gets out there to see it!

For SPPI, 7/2 is when the FDA is expected to approve or decline an additional indication for their non-Hodgkins Lymphoma drig, Zevalin. Domestically, It's already approved as a "2nd line" treatment and it is approved as a "1st line" treatment (what the 7/2 ruling will be on) in something like 40 countries.  If it does end up being approved for the additional use, I think the stock could hit $10
For HGSI, we're waiting to hear Phase 3 results for a Lupus drug. that should come sometime in July, but there is no set date.

My style of investing should be transparent from previous posts.  I venture that my portfolio is somewhat larger, more diverse, and conservative than most who post on this forum.  Other than trying to close a number of my open option positions and raise a little cash, I have not change my investment philosophy.  What I do notice is that some of you have a predilection for thinking that “it’s different this time”.  Twice before I remember unemployment being far worst than today.  At the end of the Vietnam war and the beginning of Reagan’s first term, unemployment hit double digits.  I remember Volker dealing with inflation that would make your hair curl.  Do you remember Treasuries at a mid teen interest rate?  
I’m not saying there will be no correction;  there will always be a correction, and then a recovery.  You can count on it.  And you can count on the fact that you will never be able to anticipate every/any move in time to do all that you think you should.  
I suggest to you Ven to look to how you did before March, that may tell you what to expect with the next correction.  You are young enough that you should try a lot of things (No-don’t tell your parents I gave you permission to do that), and that is good.  But at some point, you will say this seems to work for me and this doesn’t, and then you will have your style.  

spshapiro said: My style of investing should be transparent from previous posts.  I venture that my portfolio is somewhat larger, more diverse, and conservative than most who post on this forum.  Other than trying to close a number of my open option positions and raise a little cash, I have not change my investment philosophy.  What I do notice is that some of you have a predilection for thinking that “it’s different this time”.  Twice before I remember unemployment being far worst than today.  At the end of the Vietnam war and the beginning of Reagan’s first term, unemployment hit double digits.  I remember Volker dealing with inflation that would make your hair curl.  Do you remember Treasuries at a mid teen interest rate?  
I’m not saying there will be no correction;  there will always be a correction, and then a recovery.  You can count on it.  And you can count on the fact that you will never be able to anticipate every/any move in time to do all that you think you should.  
I suggest to you Ven to look to how you did before March, that may tell you what to expect with the next correction.  You are young enough that you should try a lot of things (No-don’t tell your parents I gave you permission to do that), and that is good.  But at some point, you will say this seems to work for me and this doesn’t, and then you will have your style.  

 If you'd started trading at the end of the Vietnam era, you had started trading about halfway through a 20 year bear market.