The Right Mix as of 4/30/2008

SYNA = 5.0%
JASO = 8.8%
ADBE = 5.5%
MA = 16.4%
BIDU = 10.7%
FXI = 5.8%
RIMM = 8.9%
Cash = 38.8%

Thank you FSLR, sorry GRMN

The Right Mix as of 4/29/08

FSLR 12.3%
JASO 5%
XIDE 5%
RIMM 9.1%
GRMN 9.9%
ADBE 5.4%
SYNA 4.8%
RFMD 1.5%
BUCY 5.4%
EOG 5.5%
MA 5.9%
BIDU 10.8%
Cash 19.4%

and thank you MA.

Keep Exit Strategy in Hand

I am not sure how things are developing but FED can move the market in either direction. I am watching money flow indicators and they are somewhat neutral. I am not sure how MA will react after earngings but I think it is not a good idea to buy anything infront of earnings in the current market, especially if you are holding for short term/swing trade. I am out of all Agri and may cut most positions tomorrow before FED speaks out.

Changes in The Right Mix for Monday

Sells: LFC [earnings disappointed], UNG [swap with EOG and CHK, the two best in class, just its bit easier to handle on tax side], some FSLR & JASO [to bring down the solar sector to 14%], MON, POT, MOS [sitting out of agri for a moment], BIDU [due to sell china downgrades by some analysts]

Buys: MA [5%], EOG [5%], CHK [5%], IMMR [2.5%]

The probable mix is:

Tech: 18% [RIMM 5 %, ADBE 5 %, SYNA 4.5 %, IMMR 3.5 %]
Solar: 16.5 % [FSLR 9.5 %, JASO 4.5 %, ASTI 2.5%]
Coal: 10 % [ANR 5.5 %, BTU 4.5 %]
N.Gas: 10 % [EOG 5 %, CHK 5 %]
Shipp: 9 % [DRYS 5.8 %, EXM 3.2 %]
Finan: 5% [MA 5 %]
Cash: rest %

A Right Mix, as of 4/25/2008

Solar:      19 %    [FSLR 12.2 %,  JASO 6.8 %]

Tech:      18%      [ADBE 5 %, SYNA 4.5%, RIMM 8.5 %]

Agri:      16.5%    [POT 5.8 %, MOS 5.5 %, MON 5.2 %]

Coal:       10%     [ANR 5.5 %, BTU 4.5 %]

China:     10%     [LFC 4.7 %, BIDU 5.3 %]

Shipp:       9 %    [DRYS 5.8 %, EXM 3.2 %]

N.Gas:     7.5%    [UNG 7.5 %]

Cash:       10%

Watchlist:  IMMR, ASTI, CHK, EOG, AAPL, STP, SPWR, PBR, RIG, CENX, DBA, AEM, SLV

Sector Rotation

Big money at times play game of musical chairs. You can benefit from it if you can increase and decrease your exposure as per rotation. It also pays to know the sector leaders. Just to give you an example of Solar sector. FSLR is the obvious leader in the sector. When the group was running it outperformed most of its peers. Whether the run will continue in the sector will most probably depend on FSLR earnings next week. I am doing a small exercise of making a draft list of sectors and handful of stocks that I would like to buy if I think it is the right time to be 'over weight' in the sector.

Solars : FSLR, [JASO, STP, SPWR]
Spec. Solars: ASTI, SOLF
Alt Energy: GEX, TAN
Hw Tech: AAPL, RIMM
Gen Tech: QLD
Sw Tech: GOOG, CRM
Oil & Ser: PBR, RIG
N.Gas: CHK, EOG, UNG
China: LFC, FXI
Agri: POT, MOS
PM: AEM, SLV
Trans: TBSI, DRYS
Minn: BUCY
Coal: ANR
Steel: MTL
Alum: CENX
Grains: DBA
Financ: MA
Medical: ISRG

Of the above sectors, I think two clear IN sectors are China and Trans. Now Agri sector saw some profit taking today but I am sure that the fundamentals will make them run again. PM sector is getting attactive. Lets see how things develop tomorrow.

One strategy could be to have small core position in above names when they pullback to some support and keep the core position for long run. Then to add more position size if the sector is IN and selling the extra position when the secotr become OUT. Now its easier said then done but I think it should work with less risk. However, this strategy needs little more polishing.

Back and bullish

Seems like I skipped the layoff list this time. I have been watching this market and I think it pays to stick with proven bets. I am bullish on

POT, MOS [the food shortages are going to translate into more demand for fertilizer]
CHK, EOG [natural gas is not only clean fuel but also looks cheaper in the face of higher crude]
PBR [I like this brazilian oil giant here]
FSLR, ASTI, TAN, GEX [alternate energy is the present and future]
BUCY, ANR [these minning sector plays are great to have here]
RIMM [their recent earnings shows that blackberries are not going out of high growth business]
MTL [the Russian steel maker is a buy]
FXI, LFC [dont write off China, infact we may see it notching new highs by year end]
DRYS [shippers, infact the whole transportation sector, are rocking]