Joe, Regarding your questions on seasonal holdings. . .
There are some stocks like RDOC, UQM, AMPBB, etc. that I just keep holding even through the volatility. Value plays like PHA [formerly PNU], BAC, ASO, UIS, WS, SGP, MCD or cyclicals, REITS or other long-term basic stocks. . . I will hold straight through the summer.. . .not selling in the spring. . . should be no need to sell. . .[depending on how much they have moved up in the past year]
Tech stocks are what generally get hit hard in the summer . . and in my seasonal timing plan for techs, we sell completely or nearly completely out of techs in March/April and buy up to our limit in August/September. . .whether you go all out and all in or just partially is up to you and the size of your portfolio.
If you only have 10 stocks, it is certainly easier to sell completely out, than if you have 60 or 80 stocks. And of course it depends greatly on whether the tech stocks have run hard, undiscovered or near their 52 week low. . .
So there is no hard and fast answer.
I generally sell out of any small caps and micro caps that have moved up more than about 40%. . .regardless of how long I've had them.
So I guess I look at portfolios like this. . .
Cyclicals, Dow stocks, REITS, high-dividend yield issues, basic telecoms, utilities, etc. . . . . . . . buy hold and don't look back
Value plays bought as position trades. . . .hold until situation changes or target is hit.
High fliers [both tech and non-tech]. . . . . . . .dump completely in the Spring. . .load up late summer.
General Tech stocks. . . . . . . out in Spring unless there is some very very compelling reason to hold. . . none that I can think of here.
Small caps. . . . . . .dump those that have moved up considerably. . .as they pull back. . . . re-evaluate those that haven't moved as to why you are holding them. [I know I'll get much grief from saying this, but I am not a believer in holding small caps for very long a time. . .too easy to lose big]
Micro caps. . . . . . see small caps . . .
Timing Plays. . . generally are fairly seasonal, like tech stocks. . .unless Russell 2000 begins outperforming Nasdaq composite.
Understand this. . . . if you are in disagreement with the above guidelines, then you must be happy with your choice. . .it is not easy to make money in the markets. . . it takes tremendous effort. . .and I cannot twist anyones arms to get them to sell their babies. . .that's why I don't have any babies. . . .
Stocks are simply vehicles, nothing more
What to do with all that cash in the summer? Foreign Techs, foreign markets, emerging markets, REITS and other high dividend yields, basic telecoms, basic materials, value plays, pay off credit debt, pay off mortgage interest, spend quality time with family, re-vamp your brokerage, trade station, computers, etc. Much of the investing during the summer can be done via mutual funds. . . .
I generally increase core investments at this time. . .[using plan above]. . . .trimming down the trading accounts. . .which should be disproportionately large by this time. Summer is great for re-proportioning.
Near-term, I added some core positions in some of our favorite techs on the dips this week. . . to play primarily as position trades into mid-month. . .holding with fairly light hands. . .with the intent of still buying them lower in the summer. . . so not really building NEW cores here. . . just temporary ones. . . .also, have plenty of swing trades on the bounce, but again this is very very risky.
I hope that helps some.
Rande Is |
