No Changes to Portfolio

I didn't make any year-end changes to the portfolio. I remain nearly 100% long and slightly overweighted in small caps. I also have some cash on the sidelines that has grown due to dividends, distributions and what not, that I have been debating what to do with. 

I have been thinking for the past month that I wanted to rebalance, go more to cash, and maybe pick up a Dow laggard like Nike.  I have been concerned that the market ramped too much after the Trump win and seeming overconfidence of the bulls.  If everyone is bullish and optimistic, is there anyone left to buy stocks?  72% of the country is optimistic.  Sentiment indicators are optimistic (see yardini.com for more on sentiment). 

But with all the optimism in front of our faces, my Twitter feed seems strangely bearish.  And many of those who I follow are top notch investors. (See my Twitter feed @muckdog).  They are worried about a bear market as we transition into 2017 and a Trump administration.  I've also been reading similar warnings about "market valuations not seen since" 1999 and 2006.  Or was it 1987?  And "whoa" those first couple years of the Reagan administration and the George W Bush administration were quite the stinkers for bulls! Doesn't history repeat itself or at least rhyme?  Anyway, you get the idea. The bull market that has been running since March 2009 is no spring chicken.  Bull markets don't last forever. 

So I'm living in the realm of the paralysis of analysis. Too much information!  TMI!

As of right now I decided to do nothing.  My gut feeling tells me the Twitter bears on my twitter feed are probably right and that we see a sell off in early 2017.  But my gut feelings don't usually translate to great stock returns.  I will maintain current positions, overweighted in small caps, and dollar cost average in monthly.  I'm still thinking about Nike... 

I wish all of you and yours a very Happy New Year!

2015 – Dollar Cost Averaging into an Index

If you had invested $1000 in an index ETF every Friday (or last trading day of the week) at the closing price in 2015, how would you have done?



Excludes dividends and trading costs. 

Some brokerages wave the trading cost if investing in certain index ETFs, as long as the investment is held for a certain period of time.

• $SPY – SP500
• $VTI – Total market index
• $QQQ – Nasdaq 100
• $IWM – Russell 2000
• $EEM – Emerging Markets

May add an international ETF for 2016.

The Rumbling and Tumbling Stock Market

• $SPY - Wasn't it just last January and February that we were worried about stocks?  What about October and the Ebola panic?  Or mid-December?  Yet, by the end of the year the market was up double digits.  "Buy the dip" worked.  
• Here we are with folks shouting gloom and doom from the roof tops.  The market again seemingly under pressure from the front page news headlines of the day. 
• I continue to believe that it makes the most sense to be long stocks.  Invest and reallocate on a regular basis. Buy the dips. 
• Amazing comeback win by Seattle Seahawks over the Green Bay Packers.  One of the ones you'll be telling your grandkids about!
• President Obama to give State of the Union speech tonight and call for more taxes and more government spending.  The government already wants more of your money. Nothing new. 
• Maybe a bubble in biotech stocks but that's also where the momentum has been.  Nobody wants to be the last person in the pool in those. But it is awesome when it's moving up!
• Housing bubble and collapse ... Again? Here comes the government again trying to help low income folks buy houses with low or no money down and easy qualifying loans.  Hey, what happens to those loans when the home buyers miss a bunch of payments?  We do know the answer, right?

Stock Thoughts

• Wow. Market volatility! Are we all conditioned to think that whatever the market throws at us in the first hour or so, will be completely reversed by the close? Buy dips, sell rips, and laugh all the way to the bank?
• Lots of worry out there.  Lots.  Europe. Swiss Francs.  Poor US economic data.  Bond bubbles. Biotech stock bubbles. Central banks trying to out stimulate each other.  ISIS. Oil crashing.  Energy jobs imploding. Racial conflict and organized protests. Measles at Disneyland.  
• It's amazing any of us even bother to get out of bed in the morning!
• Well, take a look at the charts from last Jan-Feb. Go ahead.  I'll wait. 
• I am still mostly long but do have some cash.  I'm actually feeling a little greedy and was looking at some call options today.   
• Be greedy when others are fearful.  Be fearful when others are greedy.  And stay away from people with measles.  

Market Thoughts

• $SPY $QQQ – Still long the market but did book a few gains. Looking to buy back any weakness.  I’m bullish on 2015.  Yes, there will be pullbacks and scary parts along the way.
• As kids we get Christmas vacation.  Why does that end as adults?  Not fair -  so I took it back!  Been on vacation for a couple weeks.
• Security stocks…  Should make a ton of money.  But could be acquisition plays from companies that need the growth into that market.  Just thinking out loud.
• Knowing history, do you think oil prices go lower and lower and lower?  I think prices go higher someday because cars still run on gasoline and economies are growing.  Meanwhile, environmentalists have declared war on fracking, pipelines, etc. 
• Commodity plays are tough with a rising US dollar, too.  Watching banks around the world for easing and tightening kinds of moves.  Also tough to hold foreign market ETFs when the US dollar goes up as those markets are denominated in foreign currencies.  We are also seeing countries that basically have no economy other than exporting oil having a rough go of it.  I’m looking at you $RSX and $EWW.
• I think there is a biotech stock bubble.  Similar to internet and business-to-business stock bubble of 1999-2000.  It won’t end well.
• Back to blogging and audioboos and podcasts in 2015.  I think having this as part of my market review routine helps to keep touch on what’s going on.  I have been more active on Twitter.  Blogging is so 2006 they say.
• By the way, I like the negativity on TWTR.  Don’t own shares yet, but it is on my watch list.
• Heading home today.  I’ve watched a $NFLX movie via streaming everyday.  WOW!  But I don’t find myself watching many DVDs anymore, so thinking about canceling that part. Anyone else?
• I wanted to spend some time this month clearing the backlog of recorded shows on the DVR.  Uh, haven’t made much progress. 

Sunday Randomosity and Kim Kardashian

• I am still long stocks since the Oct 15 buys. I haven’t seen a reason to sell and believe that the trend into year end will be up.  Yes, the market is overbought and maybe the run into the end of the year won’t be straight up.  But I think winners will continue to run as folks won’t want to sell them and will want to own them.  In addition, there isn’t another place to put money right now.
• Kim Kardashian’s butt is pretty unreal.  It’s like an anime butt, where the artist can exaggerate features. There seems to be a fan club of folks who love that butt.  Not that there is anything wrong with that.
• “China’s central bank surprised markets by slashing its one-year benchmark lending rate 0.40 percentage points to 5.6%. China last cut interest rates in 2012. The move follows a disappointing growth rate in the latest quarter. The nation’s economy expanded 7.3%, marking a five-year low.” – The markets love stimulus. It seems like whenever a central bank announces free money, stocks rip.  How long can this go on, though?
• NFL Sunday means 7 hours of the Red Zone Channel!  Gee, no wonder I can’t get any work done on the weekends.
• Josh Gordon back in the Cleveland Browns lineup!
• Obama goes commando with the Immigration executive order.  I think he was just playing the race card and trying to incite enthusiasm in minority voters by pitting them against what is seen as a “White GOP.”  Although in the election, Whites and Asians voted GOP, and an increasing number of Hispanics also voted Republican.  Hey, maybe folks don’t like to get “Grubered.”
• Remember when stocks were selling off a few months ago, and the Wall of Worry included things like Ebola, Russia in Ukraine, Middle East ISIS turmoil, and the Green Bay Packers off to a slow start?  Only one of those things has resolved itself, yet the market storms higher.

The Fox Business Block Gurus Update

Here is an update on how the Fox Business Block gurus are doing year to date compared to the indices (excluding dividends).  This return is based on investing $1000 per weekly stock pick at the closing price Friday night. 

Larry Glazer has only made one pick, F (Ford).  He lead the league for awhile, but that company has taken a hit lately.

Rich Karlgard has also made just one pick, INTC (Intel).  This should be interesting this week as the company reports earnings on Tuesday.  Semiconductors had a bad week!

It doesn't surprise me to see Gary B. Smith and Gary Kaltbaum near the top of the list.  I've often thought that those two seem to be the most consistent.  Maybe this kind of study is confirming my gut feeling.

Ben Stein and Adam Lashinsky "tend to" (but not always) pick diversified index ETFs, large mutual funds, or Berkshire.  It doesn't surprise me to see their results close to the SP500, but underperform due to expenses and fees of their holdings. 

Charles Payne "tends to" pick volatile stocks.  As the market trends strongly in one direction or another, his picks have a little extra beta to the upside or downside.

At some point, I will go over each guru's best and worst picks.  Maybe during a lopsided Thursday Night Football game.  (As if we haven't had enough of those...)

Nothing shocking here.  My suspicion was that the Cashin' In gurus would underperform the other gurus, and that most all of the gurus would underperform the SP500 (SPY). 

Everybody Waits For One But ...

$SPY - Everyone says they want a pullback in stocks but as soon as one happens they get scared and don't buy. 

Markets pulling back this morning.  Especially growth stocks.  The rumor is that the selling is out of growth names as everyone wants the new and shiny growth name that IPOs on Friday,  $BABA. 

I'm trying to get some shares but looks like it will be hard to get them at the IPO proce.  That leaves first day trading - uh, ouch.  But since folks have FB and TWTR as a recent reference it seems folks expect a pullback after the IPO.  Which means there probably won't be a pullback. Lol.  Play small on day one to get a toe in the water, and keep some powder dry for later?

Hmm.  

Looking at my watch list, the "who's who" of growth stocks getting sold hard. I'm not doing much until Thursday or Friday. 

Black Box Sell Signal

$SPY $QQQ - Sell signal on the black box today.  It's usually pretty close.  

Not sure if I will sell or my immediate course of action.  Historically and usually, the system generates multiple buy or sell signals clustered together over a few days.  But it has on occasion top-ticked the trend.  It also has been wrong on occasion.

Something for me to think about if I can’t sleep tonight.  LOL