The Fall

I was, for the moment at 3pm yesterday, looking at the index board (our office has these electronic board hanging on the wall), and witnessed the 200 points fall in a matter of seconds. I do agree with this article that it may be caused by a system glitch. However, the Fall is real for the trading day...

No intention to do "I said/warned so...", but on the record, In my recent portfolio review post, I did say

QID: If you haven't yet felt the weakness in the market, you shall take a look again. A simple advice to follow - when you buy a stock now, consider buying QID in half dollar value, a hedge against the market weakness, if you believe the market is turning weak. (QID double short QQQ)

Our portfolio was hit hard today too, with a number of stocks declined over 5%. Fortunately, as mentioned early this year, I strictly follow 50% equity / 50% cash balanced portfolio. And my equity portfolio is 25% hedged by QID (let me know if any one needs further elaboration on this), which minimize the damage to the overall assets.

For the short term, my market overall prediction discussed in 2007 outlook post is validated. Furthermore, I think this may not be it. I am not recommending panic sale - but in my opinion, Wendesday is certainly too early to jump back in even though you may already identify some bargain opportunities.

Year of Golden Pig, RICK and Jae

2007, year of Golden Pig, which symbolizes good luck and wealth, occurs once every 60 years. I wish you a happy new year. (comes later, last Saturday was the new year eve)

First, let me review one of my recent transactions. I sold PALM (Palm) after Apple announces its iPhone entry into smartphone market, and bought ASFI (Asta Funding) as one of my picks in my Year 2007 Outlook Series.

Both had a strong ride after the transactions, are up about 15% and 12% respectively. I currently reconsider buying PALM (surprise, I usually let it go, and rarely do that), as I felt my previous analysis remains true. I also find a similar mind that presents the thinking process well here. Note: not in a rush to buy, I will wait for some pull back. Stay tuned.

I sold another 1/3 RICK at $10.98, with about 90% profit (bought at $5.8 two months ago, when Gus asked my opinion about RICK, weeks after I first recommended it at $6.5). Wish all the RICK holders enjoy this ride. I still think highly of the company, which demonstrates a very strong management team, and steady growth. (They know the industry well, and know what they are doing). If the price drops 15 - 20%, I will load up again, if it continues to go up, I am still a happy RICK shareholder :-).

Speak of RICK, I have to mention my friend Jaewoo, not because he enjoys night club (he does), or he first introduces RICK to me (he did that too), but, as a colon cancer patient, he is currently fighting for his life in the hospital. Please join me to prayer for him.

A quick portfolio overview

A quite volatile day on my portfolio.

Both NTE and MMG are down over 5%, while RICK, ASFI, DAGM and OVTI are up over 5% today. This is the beauty of diversity, despite 2 disappointments, my portoflio hold well in an otherwise pretty weak market today.

Let us take a moment to review all my stocks in my investment portfolio, and some recent transactions.

Holdings:
Large Cap (>10B): COP
Small Cap (<100m): MMG, RICK, UTK, DAGM
Medium Cap (anything in between): ASFI, OVTI, NTE, SCSS, ESLR
Others: QID

Recent Transactions:
Sold: INTC (Intel) at $21.20, PALM at $13.75
Bought: OVTI at at $12.20, ASFI at $32.20, ESLR at $7.70, MMG at $2.95.

PALM was sold cheap, and right after my sale, it had quite a ride (currently closed at $15.50). That was a mistake. Otherwise, 3 buys (except MMG) look pretty good so far, I will hold them for a while.

RICK: becomes the star, and is the largest holding in my portfolio. a long term hold.

QID: If you haven't yet felt the weakness in the market, you shall take a look again. A simple advice to follow - when you buy a stock now, consider buying QID in half dollar value, a hedge against the market weakness, if you believe the market is turning weak. (QID double short QQQ)

NTE: It is a value player, but I felt it could go lower from here. Be patient, let us pick this one at dirty cheap price.

MMG: I am more interested in this speclative player now. I will add more if it dares to drop close to $2.