Real Money Portfolio – Update 3/3

This thread tracks real trades in one of my portfolios. Refer to backgrounder for more info.

What a difference a week makes.  Last week, we were up 7% and thought to be well-positioned for a continued move up.  Today, the 7% is gone and we are back to where we started on January 1.  It could have been worse.  Matter of fact, if I hadn’t made any moves more damage would have been realized. Being flat is nothing to brag about, but it’s better than being down.

So, let’s take a look at the moves.

The DOW’s 400 point loss on Tuesday (-3%) was tame compared to what happened in the commodity patch.  Commodity stocks were taken out and shot.  The Gold Mining Stocks index (GDX) was down 7%.  Both BHP and AUY were sold on Tuesday.

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I sorta kicked myself when I sold AUY.  I typically wait until the last 15-20 minutes of the trading day to execute most of my sells.  However, I couldn’t handle the heat and sold around 3PM.  Right afterwards it bounced above my target selling price.  It really didn’t matter much.  I probably would have sold it on Friday for maybe a dime more.

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The selling subsided on Wednesday, but was back in full force on Thursday.  On Thursday, I made a partial sell of CEF and the remainder on Friday.

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Who knows where the market goes next? Maybe the market will bounce back.  Maybe it won’t.  Gold really should have separated itself from the general market and served as a safe-haven.  However, bonds were the only place to hide. 

The Real Money portfolio is only one part of my overall portfolio.  I sold quite a bit in the rest of my portfolio as well.  I also went short two subprime lenders – NEW and LEND.  I will share more about those trades in a few days.

Until I get a sense of the market’s direction, this portfolio will remain 100% cash.

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Remember our old friend Cresud.  Two weeks ago it was up 15.5% in a one week.  Last week it gave it all back plus some.  It closed down 17.5% for the week.

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