That's a pretty sizable holding. I'd say you best listen to the conference call for clues. FLC has my interest, but I've not purchased any yet because of the 'percieved' debt. I know others state this is to build rigs under 3 year and better contracts, but debt can drag a good company to the bottom if seas turn foul.
My belief is FLC will show strong upside if the OSX industry turns, since so many investors have withdrawn. The debt will act as leverage on the upside, improving earnings per share.
I would establish an amount you want invested in a sector and company, then diversify over 5-10 companies if you can, and move in to stocks that catch your eye in thirds. Put a third down, or just pick up a 100 shares to 'help' you follow a company closer. As time goes by, if events convince you to add, then bump it to a full third. If it runs to the upside on you, at least you own some. If it drops due to market sentiment, but is still fundamentally sound, add another third. Then if it runs to the upside you can halve your position in case it's a fake rally, yet still retain a core holding in case the rally is real.
That's the style I try to use, though I almost always end up selling my core holding (first 100 or first 1/3) too soon due to a bearish streak in my blood. The style is a mixture of that used by Cary Salsberg and Michael Burke. The hardest part of investing is picking the right point to sell. I think that's why Buffet doesn't bother.
You can't diversifty over multiple sectors, with multiple holdings in each, in this fashion, unless you have more capital to work with than the average trader. But 45k of FLC says that you are an exception. |
