1) United States Steel (X) - $65.28, .31% yield.
2) Citigroup (C) - $4.13, no dividend.
3) Telecomunicacoes de Sao Paulo (TSP) - $21.76, 9.85% yield.
4) Montpelier Re Holdings Ltd. (MRH) - $16.85, 2.14% yield.
5) San Juan Basin Royalty Trust (SJT) - $20.58, 10.46% yield.
In one of my first posts on this blog at the beginning of the year, I devoted an entire blog post to "My Dogs of the Dow". In that post, I detailed some of the metrics I use to identify undervalued stocks. Among the criteria is the price to cash flow ratio. While reading my new issue of Forbes over the weekend, I came across this article. The Forbes article details cash flow much more eloquently than I can, and in much more depth than I previously did. This is well worth the read, and I encourage everybody to take a look at this article and study it.
Before reading, please see the disclaimer in the 'About Me' section.
The Wilshire 5000 closed at 12,133.00, up from 12,058.70 since my post on 3/21/10. The Wilshire 5000 is now 11.36% above it's 200-day moving average, up from 11.31% last Sunday. The Wilshire 5000 reached a level 12.63% above it's 200-day moving average on the 23rd.
The Investor's Intelligence Survey was released on Thursday night. This week's reading was 48.9% BULLS, and 20.5% BEARS, for a spread of 28.4%. This is in comparison to a reading of 46.1% BULLS, and 21.3% BEARS, for a spread of 24.8% on March 16th. Last week was the largest bull reading and spread we had seen since January 19th, and this week has managed to outdo last week yet again.
The Volatility Index closed today at 17.77, up from 16.97 last week. The VIX continues to trade below the 20 mark, and has done so for at least four weeks now.
Now for the portfolio...
1) Verizon at $30.37, down 7.86% for the year.
2) AT&T closed at $26.72, up .11% for the year.
3) GE closed at $18.34, up by 21.98% for the year, including the reinvestment of a dividend in February.
4) TBT, the doubleshort U.S. Treasury ETF closed at $49.24, down by 1.28% since my buy.
5) FXP, the doubleshort China ETF, closed at $8.40, down by 2.55% since my buy.
6) GOOD closed at $14.51, up by 7.53% since my buy, including the reinvestment of a dividend which was received on the 19th that I did not include in last week's update.
7) NLY closed at $17.33, up by 2.08% since my buy.
8) AAPL closed at $230.90, up by 19.17% since my buy.
Overall, the portfolio is up by 9.40% (4.73% for the DOW Dogs, the total DOW has returned 4.05% without dividends, gaining 2.56% just this week), versus 5.53% for the Wilshire 5000. The current basket of eight stocks that I am currently invested in, including dividends, is up 4.85% year-to-date. The spread between my performance and the overall market (Wilshire 5000) has increased to 3.87%, up from 3.85% last week.
The investment world is often a cloudy, intimidating landscape. For sure, it is not for the faint of heart. Sometimes it can be very difficult for one to put up their own money lacking any formal training or guidance. Oftentimes, it is difficult to trust those giving you advice who have had formal training. With that said, short list of the toolbox that you need to navigate through the scary and meaningless:
1) Confidence. One must have the ability to believe in the thesis which they have drawn, and to stand by it when your own money is on the line even if it does not work immediately. If you believe in your thesis, and your thesis makes sense, more likely than not you will make money. If you're not sure if your thesis makes sense, or you fear your judgment is biased, ask a friend for a second opinion.
2) Patience. If it's too good to be true, it probably is. Historically the entire market only returns something like 8%. At that rate, your money will double roughly every nine years. Every portfolio has winners and losers, and you're not going to pick 100% winners. Don't expect every investment to return 50% every year, you're just setting yourself up for disappointment. If the story is good, and your thesis is sound, you will make money over the long run.
3) Diversification. Jim Cramer says that diversification "is the only free lunch", and he's right. This is right up there with "don't put all your eggs in one basket". Diversification will smooth out your returns over the long haul, and will make you less susceptible to huge swings.
4) The ability to read financial statements. Financial statements tell a story. If you don't know what the story is, where the company has been, and where it is likely going, you might as well throw darts blindfolded. Also, read the notes to the financial statements, the independent auditor's report, the CEO's letter, and listen to the conference calls. Often there is a lot of good information in these pieces. Not everybody reads or listens to this stuff, doing so gives you a leg up on the market, and makes you a savvier investor.
5) The ability to research and seek out new ideas. If mainstream America knows about an opportunity, you're probably the last one to know, and you probably already missed the boat. Be the first one in. Buy when others say sell, and sell when others say buy. Do research to seek out new ideas and opportunities. Then, research those opportunities until your thesis is well supported.
Before reading, please see the disclaimer in the 'About Me' section.
The Wilshire 5000 closed at 12,58.70, up from 11,984.30 since my post on 3/14/10. The Wilshire 5000 is now 11.31% above it's 200-day moving average, up from 11.29% last Sunday. The Wilshire 5000 has been able to extend it's percentage above the 200-day moving average for yet another week
The Investor's Intelligence Survey was released on Thursday night. This week's reading was 46.1% BULLS, and 21.3% BEARS, for a spread of 24.8%. This is in comparison to a reading of 44.9% BULLS, and 23.6% BEARS, for a spread of 21.3% on March 9th. Last week was the largest bull reading and spread we had seen since January 19th, and this week has managed to outdo last week.
The Volatility Index closed today at 16.97, down from 17.48 last week. The VIX continues to trade below the 20 mark, and has done so for at least three weeks now.
Now for the portfolio...
1) Verizon at $30.41, down 7.74% for the year.
2) AT&T closed at $26.71, up .07% for the year.
3) GE closed at $18.07, up by 20.18% for the year, including the reinvestment of a recent dividend.
4) TBT, the doubleshort U.S. Treasury ETF closed at $46.88, down by 6.01% since my buy.
5) FXP, the doubleshort China ETF, closed at $8.37, down by 3.25% since my buy.
6) GOOD closed at $14.50, up by 7.53% since my buy, including the reinvestment of the monthly dividend.
7) NLY closed at $18.170, up by 7.91% since my buy.
8) AAPL closed at $226.70, up by 17.01% since my buy.
Overall, the portfolio is up by 8.73% (4.16% for the DOW Dogs, the total DOW has returned 1.49% without dividends), versus 4.88% for the Wilshire 5000. The current basket of eight stocks that I am invested in is up 4.13% year-to-date. The gap between my performance and the overall market has increased to 3.85%.
Apparently the market CAN go up every single day. The Wilshire 5000 closed today at 12,134.20, now 12.14% above it's 200-day moving average.
The VIX (Volatility Index) closed today at 16.62, a level that hasn't been seen since sometime in 2008 according to the chart I looked at.
As I have been saying for a while now, I think the market is near-term overbought, and we are looking at some type of short-term correction. However, I could very well see this rally extend through the end of the quarter next Friday. Buckle your seat belts.
Wow, the market is just unbelievable these days. Today, the Wilshire 5000 closed at 12,076.31, up from 11,984.3 at the close of last week and 11.93% above it's 200-day moving average.
The VIX closed today at 17.69 as it remains below the 20 level.
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