POSITIONING GOING INTO NEW WEEK
Just wanted to give an update as to my current positioning and intentions going into the new week. I do believe we put in an important low last week. I reacted promptly on the day of the reversal putting to work 75% of the cash in the portfolio during the last hour of trading on Tuesday. This was updated on Twitter during market hours. @Zenpenny1 if you don't already follow on Twitter.
I took some quick profits on Thursday in order to move my net exposure right around the 50% mark. My current positioning allows for riding out some of the rough patches that may come. I have every intention of holding onto the current portfolio positions for the intermediate term...meaning the next 4-6 weeks. Possibly longer based on market action.
Going into Monday I am holding EDC, FCX and JJC. EDC and JJC are ETFs and FCX is Freeport McMoran Copper. EDC is a 3X bull emerging markets ETF. JJC is a copper ETF. Both JJC and EDC are concentrated positions.
I believe that opportunity exists in emerging markets, the banking sector and technology. Emerging markets and banking possess great opportunity because of the level of dislocation that has taken place over the past several weeks. The pricing for these two sectors have moved far away from any kind of truth. It is more a product of panic, fear and unjustified concern over past boogie men more than anything else. When such dynamics exist, the opportunity for profit is substantial. I like to look for substantial areas of profit that are gloomy and dark...emerging markets and banking both qualify.
Copper is a further play on emerging market reemergence as well as economic stability. The selloff in copper was based on false expectations of recessionary conditions hitting the global economy. It will become increasingly apparent going into the final months of the year that recessionary conditions just don't exist.
FCX is obviously a more aggressive play on copper and remains the smallest position in the portfolio. Not comfortable owning individual stocks for the foreseeable future. I prefer ETFs for the time being.
The remaining cash in the portfolio will be used to buy dips in technology and financials. Most likely in the form of TQQQ and FAS.
A few positions, in a few different markets is really all you need. I'll make updates when and if things change.
