I am not a “serious” or “big time” investor. I am more active them most individual investors and I do almost all of my own research. I trade long in both stock and options. I occasionally short positions, but usually only to hedge long positions during a down cycle. I monitor fundamentals, and some technicals, for all of my positions. I dedicate two hours per weekend and no more then one hour Monday, Wednesday, and Friday for following company events and reading reports. I invest only in companies that I understand (or believe that I understand). This has worked very well for me…but I really hate times like these…
The DOW is down 18.45% for the last 12 months. I do well in an up cycle, like most investors, but can only break even during a down market. For the last 12 months, I am up 5.32% in my personal trading account and down 6.08% in my 401K. My higher risk account (managed by a Pro) has realized a 20+% gain but we are sitting in a large, for me, SIRI position that is down – it could be a multi-year killer. I may have Lots and Lots of losses to “offset future gains” if the merger deal with XM does not get approved or the market does not react well to the news.
I should be happy, I know. If I was in an index DOW fund, I would be down 18% for the last 12 months and I am not. That does not help much. I have three girls and who want wedding and college educations paid for…one of the very few times it sucks being “the dad”.
Oil was good to me but I scaled out when it started to flirt with $140 a barrel. I am stuck and waiting like most investors. The market is worried and so am I. A very large bank was just taken over by the Fed…Iran has a mad man running the country…I am not sure if the world is going to hell or not.
Go cash or safe bond fund? May not be a bad a idea until the election is decided, oil drops a bit or GDP has a nice gain. Do I spend a couple of weeks trying to learn the basic strategies of making money in a down market or do I sit out the next X number of months? I do not know which will be the right answer but this weekend I have to decide on a plan.
The Big Question: Protect what I have or try to use the market fears to my benefit?