PORTFOLIO UPDATE: FIRST LEG OF ADJUSTMENTS COMPLETE
During the trading day Thursday, I tweeted the following:
The decisions I make with respect to allocation are 100% systematic in nature. I feel it necessary to constantly remind readers of this fact so that you don't think that I suddenly wake in the morning and decide that the portfolios need to be positioned more defensively. The discretionary aspect of my reducing or increasing allocation has to do with what I choose to reduce or increase.
In this most recent case, the reason I chose to eliminate SBCF had to do with two factors:
1. Liquidity: SBCF was a small position to begin with and had ample liquidity to absorb any selling
2. Exposure: The position rounded out the financial exposure I had in the portfolios with WMIH and HMPR. WMIH is a large position and HMPR a mid-sized position. I didn't mind reducing my overall net exposure to the financial sector just in case.
I trimmed away very small bits from other positions to get to the desired target of 75% long and 25% short via TZA.
The 75% long exposure is in WMIH, CIDM, HMPR, JMBA and IWSY. Compact, focused and concentrated. Just the way I like it.
