Monday, September 30, 2013

Investors Shouldn't Fear a Government Shutdown

Why Investors Shouldn't Fear a Government Shutdown

By Steve Rothwell and Ken Sweet

— Sep. 28 3:00 PM EDT

 NEW YORK (AP) — The government shuts down. The economy unravels. Stocks plunge.
That may be Wall Street's worst fear, but history shows it's mostly overblown.
There have been 17 government funding gaps and shutdowns since 1976, ranging in length from one to 21 days. A funding gap is when federal agencies continue to operate without the passage of a regular appropriations bill. None has caused a market meltdown.
The average decline in the Standard & Poor's 500 index during one of these periods lasting 10 days or more is about 2.5 percent. For those lasting five days or fewer, the average decline is 1.4 percent.
"If they shut the government down for two days, the world's not going to stop revolving," says Ron Florance, deputy chief investment officer for Wells Fargo Private Bank.
A shutdown may even offer a buying opportunity.

Investors should consider the improving outlook for the global economy instead of worrying about Washington.

7:41 am Monday Sept 30th
As I write the Dow is down more than 100 points. At the same time, 3 out of the 4 stocks in our Core Equities Folio are up.
Core Equities Folio
Facebook Linkedin Las Vegas Sands and Celgene

GWM Model Portfolio Core Equities Folio Allocations:
Go Getter = 40%
In Betweener = 30%
Golden Years = 10%

The Core Equities Folio is primarily comprised of very large and liquid leading stocks. At times, these leading stocks follow the beat of their own drum. So, when the general market is stumbling, these stocks can actually continue to rise or go sideways. In a way, they help provide meaningful diversification.
I will more than likely be raising the Core Equities Folio Allocation to 20% from it's current 10% in the Golden Years Model Portfolio before long.
By the way, as I am finishing this blog post, all positions are now positive while the Dow is down 95 points.
8:04 am
Core Equities Folio

This blog post does not constitute an offer of investment advice. This blog is only provided for educational purposes. Please read the Important Blog Disclosure posted in the right channel bar.

Tuesday, September 17, 2013

Facebook Comes Back with a Vengance

Facebook (FB) jumped 6% in above-average volume. The gain breaks a three-day losing streak.

Facebook (FB)

Core Equities Folio
Today's Performance

Furthermore, I added back YELP yesterday, which turned out to be timely as it rose over 5% today.

Core Equities Folio Position Weightings:

Facebook  25%
Yelp 25%
Las Vegas Sands 25%
Ford 10%
Linked In 15%

Wednesday, September 11, 2013

Complete Summary of the Core Equities Folio Performance from Sept 1st 2013 to Sept 11th, 2013

Complete Summary of the GWM Core Equities Folio Performance and Position Weightings for the month of September so far. We are on the comeback trail.

The positions were valued on 09/11/2013 at 11:00 am.

GWM Core Equities Folio

This blog post does not constitute an offer of investment advice. This blog is only provided for educational purposes. Please read the Important Blog Disclosure posted in the right channel bar.

Las Vegas Sands (LVS) Yet Another Core Equities Position

Las Vegas Sands is another Gap Up stock. It is up another 1.10% today as I write. It is getting extended now with a High Jump Indicator reading of 96.47. When this reading hits 100 it has historically been a good time to take your profits.

Las Vegas Sands
Daily Chart

* Las Vegas Sands has a 10% allocation in the Core Equities Folio.

Facebook (FB) Another Core Equities Folio Winner

Facebook's chart looks a lot like Yelp. Don't you think? It is up also today by 2.5% as I write.

Most investors think they have missed the boat after a stock gaps up. This is generally wrong thinking; A gap up on above average volume really tells us that the big institutions want to own the stock in a big way.

Facebook Daily Chart

Facebook has a 20% allocation in the Core Equities Folio.

YELP - Big Winner in Our Core Equities Folio

I remember when Jackie Gleason would say "to the moon Alice" in the old Honeymooners sit-com.  I know I am giving away my age. Well, that is what YELP has been doing.

It is up another 3.79% today as I write.

This is is what a real leading stock looks like on a chart.

YELP Daily Chart

The Core Equities Folio has the following percentage allocation in our newly restructured Model Portfolios:

Golden Years - 10%

In-Betweener - 20%

Go-Getter - 40%

* YELP has a 20% allocation in the Core Equities Folio.

Tuesday, September 10, 2013

GWM Core Equity Folio and Major Markets Folio New Positions

Below are the newly taken positions in two of the GWM Model Portfolio folios:

Having bought the dip is paying off.

GWM Core Equities Folio

The Major Markets Folio, for the first time in a while, now has exposure to selected international markets. Europe is finally emerging from their long time recession. The European market (VGK) has bottomed and is now in the beginning phase of a new bull market. The South Korean market, which is actually more tied to the US than Asia, is performing well (EWY). The Japanese market (DXJ), while volatile, looks promising as their economy seems to be turning the corner. Finally, the Nasdaq (QQQ) is outperforming all other US markets.

Major Markets Folio

I just added DXJ today.

As you should be aware the Flexible Income Folio has been retired and is no longer dragging down our performance.