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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Graham Osborn who wrote (55228)	4/23/2015 3:06:06 PM
From: Shane M	Read Replies (1) \| Respond to of 78714

Hi Graham, I have no specific insight, but I agree with what you're saying to a degree and have weighted my position appropriately. I haven't seen the type of fear that I'd like to see in the sector, but also find it probable that prices don't go lower than what we've seen, so maybe it's a long slow slog out. Historically the "long slow" price recovery often happens and I'm prepared to hold for several years. If it takes 5 yrs the investment probably won't work out for me, so there's always risk I guess that can't be avoided. LIke you say also though, the rest of the market could do worse based on valuations though. I'm not 100% into my ultimate position yet. Probably closer to 70% or so of the full/max position I'd commit to energy. So in a way, I'm trying to just put odds on things rather than have a binary outlook, as I realize it could go either way. I'm sortof "half-in and half-out," if you will. The market makes me look stupid from time to time so I just try to position near term for where I think the longer term trend has to end up. I might even sell a bit of a rally if things get too optimistic to lower my exposure - but that's not in my plans as I'm not very good at trading and it takes up alot of mental space. My tendency is to be over-cautious on these types of things, so I try to take that into consideration when setting risk tolerances and allow myself more freedom to put my toe in the water. I do think it's important to filter based on low debt levels (like you mention as a risk) and have done so. I don't want excessive leverage to do any of the companies in before the recovery happens, so I don't "need" a fast recovery. I've been reading several stories about how there's so much money flowing into energy that it could keep some companies propped up longer than they should be and that'll only delay things. North America seems to be responding more quickly to price changes than international from what I can tell, so companies w/ more international exposure may be way to go to control risk - if that's not already priced in. This is a value board, so market dynamics generally aren't discussed much, but one thing I note is the energy stocks seem to have life under them right now. They "want" to rise, if I'm allowed to anthropomorphize. ;-) I do try to take that into account also as I feel it's reflective of a collective market intelligence of people way smarter than me, although mood can change on a whim. thanks for the discussion, and best wishes with your investments edit: btw - I added to PPC today on bird flu news. Also plan to continue diversification over several months to international exposure via some of the vanguard etfs to take advantage of strong dollar.