Potash is down 10% today and has fallen back to its 50 day moving average of $75 so my order executed just above that. This drives up our exposure from 0.7% of portfolio to 1.4% - again all I really am doing here is a pairs trade of sort - I sold out of one name and rolled into another (but I was able to buy the "other" 10%+ lower). I am willing to purchase here, but if we begin to break down to say upper $60s I'll cut back exposure as I believe this "global growth is back because a stupid shipping index is up 2% after falling 90%" is complete bunk.
Further, Monsanto (MON) is coming into range - we've been waiting for this gap to fill, and a buck more to the downside and my limit order should hit.
My limit order here is around $77 so if it hits I will just edit this entry - again I'd like to stress the potential for some losses is far higher here on short term buys then what we've enjoyed the past 7-8 weeks. So I'm looking more towards things I want to keep in the portfolio for the longer run when they pull back.
EDIT 3:45 PM: Monsanto limit order hit
Are people beginning to doubt the veracity of SuperObama being able to reignite growth with his magic wand?
Long Potash in fund; no personal position
4 comments:
Mark: Thanks to your note a few weeks back in which you scaled down your position in POT, I did the same, except I sold all of mine. ***BUT***, what really impressed me about your insight into this was your comment that while it may continue to go up for a while (as it certainly did), it may go down, and if it does, it may/will happen ***VERY QUICKLY***. Boy were you correct in your call. I haven't bought POT yet. I'm just damn scarred to by anything at this point. Just to note that I am 62 years old, and 5 to 10 years for bulls to return wont help me one iota (maybe an upgrade on my tomb stone).
As always, thanks a lot for your work.
serge.
Thanks for your comments.
POT, and all commodities are just in the hands of the speculators. I allocate little to this group because these stocks go up 10% in 1 day, and then down 10% 4 days later. That means there are being used for nothing more than speculation - companies that move on their own basis do not move like that.
I have directed a small portion of the portfolio for that purpose (speculation) and riding the herd up and down but I am trying to keep most long exposure in names with real stories.
I do like agriculture the best of all the commodities though and what people need to be aware of is yields drop in food production due to lack of credit/lack of fertilizer worldwide - we are setting ourselves up for some serious global food emergencies. I could see government (worse case scenario) stepping in and buying fertilizer because food is not exactly something you want lacking.
With that said, these are just hedge fund playthings for now. YOu can trade anything as long as you have exit strategies. I used to own fertilizer stocks back in the hey dey at 5-7% type of position so 1.5% or whatnot is still just a throwaway position.
will be a good buy again at some point, but i have a feeling being patient will pay off.. no need to get back into this quite yet until we can see signs of demand starting to pick up a little bit. they had the perfect storm of insane demand and limited supply. this slowdown obviously makes the picture even more perfect later down the road, but who knows when that will be. i have a feeling there will be an interesting 'squeeze' in between whenever demand picks back up and the time when new supply eventually hits the map a few years down the road.
also, the ferts were down big today mostly because MOS laid off a ton of ppl, citing slowling demand blahblah, you know, the usual.
I love all the attention to this purchase. In terms of portfolio allocation I pushed my "commodities" allocation from 1.9% to like 2.7% ;) woo hoo
when I'm bullish at least for a trade it will get nearer to 6%
I am incremental in approach. And not saying I caught a bottom - but better than the sucker who bought 11% higher than me a day earlier ;)
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