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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (36394)8/20/2010 10:10:15 PM
From: E_K_S  Read Replies (1) of 78705
 
Hi Paul - How's your turnover rate going this year? I did a quick calculation and I need to harvest more of my profits and work on turning the portfolio % over. I am only at 12% for the year and have a target of a minimum of 33%.

The one big problem I have is that with many of my buys over the last 18-24 months, I was able to acquire some good value buys at a low cost basis that pay good dividends. I need the dividend income and hate to sell as it will be difficult to find equivalent dividend payers.

The positive of having a set turnover target is it makes you book a portion of your profits and get the money working in new sectors. If you do not do this, the portfolio eventually gets concentrated in one or more specific sectors.

Therefore, this quarter I am going to try to be aggressive on selling a good percentage of my winners. Many of them are close to fair value but I could make an argument on holding them longer too. I do continue to harvest my losses so that will help bring my average cost down too.

My strategy is to move the money into the new sectors I have on my watch list (a lot of MLP's, E&P and natural resource companies) and book a good portion of my REIT preferred stock and utility profits that paid off in spades during the 2008-20099 melt down.

I guess it is a good problem to have. Since I have so many stocks, after my planned sales, it should not impact my core positions that much and I will still have pretty much the same sectors covered but in a slightly different percentage.

EKS
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