Honest Opinion

I haven't written about the markets lately and to be completely honest the reason for this is that I have been somewhat confounded by the drastic moves stocks have taken over the past 3 1/2 weeks....over this period of time, there have been 15 100 point swings in the markets out of 18 days (to put this in perspective we have not seen that sort of massive swings in stocks for over 25 years). The volatility (movement up and down) is unlike many in the investment world (professional money managers) are accustomed to and it has made investing as difficult as can be. There have been no distinct trends that have presented themselves in a manner that gives me or others I work with the confidence to invest. Because of this, we have been maintaining higher than normal cash positons (appromixately 30-40%) as it is a more intelligent investment philosophy to focus on capital preservation as opposed to capital appreciation (sometimes its better to focus on defense instead of offense). A couple of things that we HAVE seen is that Europe is still an investment arena to avoid, as are the emerging markets (such as Russia) and even China (as their economy is slowing). U.S. stocks still remain the best house in a bad neighborhood but the overall risk/reward still is skewed toward being riskier than we would like to see. I still expect at some point in the near term we will see a selloff which will ultimately produce some good investment opportunities (the safest way to go about this will be buy buying small/mid cap U.S. growth funds) as well as high paying dividend stocks. We are still holding some of our "core investments" that consist of high paying dividend stocks, as well as some longer term growth stocks that we expect to be big winners over the course of the year. I wish I had more to write about but in my honest opinion the investment environment is a confusing one at best and investors need to err on the side of caution. Hopefully next time I'll have some more constructive things to write about...I will update this blog over the next several days.