My Portfolio and Investment Ideas: Updated 9/10/2011

I have updated My Portfolio Breakdown and Investment Ideas.  The previous update can be found here.  I increased my Bearish Investment exposure as well as raised some cash from my Bullish Positions.

Conditions in the Eurozone remain accommodative for continued pairing in risk.  I am also slighly increasing my short exposure due to a significant danger on a negative resolution resulting in adverse economic conditions at home.  Given that the US economy is almost at stall speed, if not there already, a Eurozone blow up would be the straw that breaks the camels back in my opinion.

China is still growing at a brisk pace, but they remain an export dependent country.  A souring global economy would be a large headwind and weaken growth prospects markedly.  While a good portion of their GDP growth is due to fixed-investment, there are warning signs that this tailwind may weaken significantly if economic conditions turn ugly.  Credit Agencies are sounding an alarm that banks in the region have high amounts of underperforming loans.  China’s economy may experience a significant hard-landing scare if Eurozone issues aren’t taken care of.

The global economic recovery largely hinges on the Eurozone.

From a technical perspective various important moving averages are pointing lower with the 200 day essentially flat signaling a neutral market.  Important crosses in moving averages signal that the market is close to entering a long-term bearish trend.  Other important signals of global growth such as copper are on the brink of breaking down.  I’ll be looking at this indicator closely.

I remain cognizant that central bankers will more than likely resort to continued monetary easing to battle recession, therefore I am not committing too much to shorting commodities.  As far as future investment ideas, I am considering gold; but not now due to downside risk if central policy bankers continue to abstain from strong monetary measures such as QE3 (balance-sheet expansion).

My Portfolio Breakdown

+ 9%: Bullish Investments

+ 35%: Neutral (Cash)

+ 56%: Bearish Investments

My Investment Ideas

Bullish Investments

Long Alternative Energy (FAN, TAN)

Long Commodities (IYM)

Long Transports (IYT)

Long Manufacturing (DIA)

Long China Consumer (CHIQ)

Bearish Investments

ShortCommodities (DDP)

ShortS&P 500 (SH,SDS)

Short Consumer Discretionary (Short XLY,SCC)

Short Developed Markets (DPK)

Short Emerging Markets (EUM)

Short Europe (EPV)

Short Financials (SKF,SEF,FAZ)

Long US Dollar (DXY)

Long 10-yr Treasuries (DTYL)


Report Updated: 9/10/11

This entry was posted in Investment Strategy and tagged . Bookmark the permalink.