jbe; RE:" Equities -vs- Indices "
I will add my kudos to others regarding your thoughtful post, jbe.
In general, I have found that trading the sector indices has increased my skills and awareness a great deal. Just looking up the components of the OSX.X and SOX.X and DRG.X - tracking these equity issues along with the indices themselves - has been enlightening, to say the least. As a direct result, I now prefer the diversification of buying and selling indices, and only trade individual equity components when I sense an opportunity to grab some underlying equity option before it crosses an "options boundary".
CL98N and CL98Z - crude oil futures are a driving force for the XOI.X / OIX.X in general, and the OSX.X in particular - the OSX.X being more volatile. I cannot imagine "investing", ie., "buy-and-hold-forever" any oil or oil service stock. But the OSX.X is great for "trading". Yes, indeed - the capital gains taxes are a consideration - but then there are better ways to sit on your portfolio than trading OSX.X options, which is fast, fun and frustrating all at the same time !
My favourite do-it-yourself portfolio consists of 100s each of DIA DJIA DIAMONDS, SPY S&P-500 SPDRs, and 100s of each of the 17 international WEBS (Check out the WEBS on amex.com ). Today, this consists of a $50,000. portfolio, $20,000. of which are the (US bellwethers) DJIA-30 and S&P-500 indices themselves, the rest are primarily in Europe. This portfolio is up about 20% this year, is not likely to tank, pays dividends (from each country) on the underlying, diversified mix of stocks, and will beat 80% of the professional MM's this year. The EU is especially hot right now, and I like being diversified all over the world - with a 40% US weighting - and instant liquidity.
Just putting DIA, SPY, and the 17 WEBS into an online portfolio thingy - like MyYahoo! - and tracking it, is a useful endeavour for any stock trader. Anyhoo, good luck to all y'all oily-people. ( I bought more OSX 110 CALLs when the index hit 107 flat just before close today ;-)
-Steve |
