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What I have learned in the last 12 months



June 02, 2012 – Comments (4) | RELATED TICKERS: CHK , BTN , LF.DL


Same time last year something about the markets spooked me. I pulled my retirement account out of equities and into money market funds and wound down two thirds of my most volatile long positions in my investment account. There was smoke in the air and soon enough, the fires followed. I did get back in though.

That said, I realized that macro factors are fully front and center in our current investing environment and even as a long term value investor, I can’t just sit back and watch my investments get decimated repeatedly. Since then I have become a yet more voracious reader; keeping a closer eye on global economic factors, Central Bank decisions and learning more and more about countries like Brazil, Russia, China, Greece and France.

In short:

We are at an inflection point and as an investor I need to have a position, solid or not, on overall macro conditions – since March this year, I have been short Russia, Oil and Emerging Markets.

There are still hidden value plays out there. My favorite YTD? Leapfrog – a turnaround, children’s edutainment company looking to walk in the shadow of Big Brother Apple.

The Bernanke Put is alive and well. The question is, how much more can we continue to ride on Hopium?

Always have some cash to deploy. You never know when an enticing opportunity might appear on the horizon. I currently have my eye on Ballantine of Omaha.

Cheasapeake – McClendon might have acted inappropriately but the CHK volatility gave me the chance to understand how to play options. The company can survive without him and with Natural Gas at rock bottom and the discovery of a new bountiful oil well, the future looks bright.

Facebook – the more things change the more they remain the same. And guess what? People forget very quickly.



4 Comments – Post Your Own

#1) On June 03, 2012 at 10:12 AM, dwot (29.45) wrote:

I've gotten out when spooked and then gotten back in and that approach worked for me. I saved capital and then created more when I got back in.

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#2) On June 03, 2012 at 1:24 PM, constructive (99.96) wrote:

since March this year, I have been short Russia, Oil and Emerging Markets.

Just don't get greedy.  Shorting emerging markets might work right now but it's clearly a losing strategy over the medium and long term.

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#3) On June 04, 2012 at 11:18 AM, Valyooo (32.77) wrote:


I agree with you that it will be a losing strategy over medium and long term...but I would not say "clearly".  There is NO certainty in this world.

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#4) On December 15, 2012 at 6:37 AM, AnsgarJohn (98.72) wrote:

Why did you short NL ? Just curious.

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