Stepping Aside, Just a Little

While my tea kettle starts to heat some water for my earl gray, I am going to paint a picture for you.

Imagine you were +25% for the year, after barely scraping out a gain the year prior. It’s summertime and the world is filled with uncertainty. There are wars taking place and giant nations, ancient ones, on the verge of financial collapse. You find yourself long a wide array of risky and volatile stocks, all up from your basis. Under such a scenario, I’d say only a fool would just sit there and let nature take its course.

I took profits.

Early this morning, I sold out of MOS, ALJ, CRESY and shaved off a few percent from some other positions, putting my cash horde up to 45% of assets. I didn’t have to do it; then again, I am not required to do anything but make money for my clients.

I kept some of the more interesting names, since I do believe there is a bid in this market. I still have my entire EXK and LNN positions, as well as RNF, CPST and CGA. I hope the market goes straight up and everything I sold gets bought out by MSFT. The truth is, I cannot justify being heavily long as Spanish and Italian yields break new highs.

If and when the ECB bails them out again, sending yields lower, I will have ample time to repurchase the market. Until then, or until we get an official OVERSOLD reading in The PPT, I will be playing this market as if I was dancing atop expensive dinnerware.

UPDATE: I changed my mind on RNF and sold it out for a small loss.