Bookkeeping: Closing Excel Maritime Carriers (EXM)

I am closing out a tiny position (less than 0.1% exposure) in Excel Maritime Carriers (EXM). I am not at all bullish on the sector, but much like housing I wanted to have exposure to something that reflects Kool Aid. Basically the shipping stocks are a proxy on global growth - which there are other ways to play, in the pure commodities. With a bevy of new ships coming online, plus many unused one sitting stashed in the seas off Singapore there is really not a great case to be made here, unless you are a daytrader. The commodity stocks have reacted far better than the shipping stocks in this latest rally so I am going to try to avoid portfolio bloat and punt this non performer.

I sold the last shares out today in the $6.60s - impact to portfolio immaterial. I also cancelled the limit purchase order at $6.20s I've had out for over a month ("fill the gap")


I continue to have about 15 limit purchase orders for other names - hoping to see some of them fill if over the coming months we see some true correction. I like all these potential names far more from a fundamental point of view far more than EXM. This is a solid trading stock - not so much for investing at this point.

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Overall strategy, despite being a bear on the "real economy" (the subsidized economy is another matter) is to buy the dips along with the masses until it stops working; while retaining a hedged approach of varying degree. What we've had so far for weeks on end I don't consider "dips" - I am looking for more and have my limit buy orders "lower". Only when serious support is breached will I be going more heavily to the dark side. Being anticipatory in this market has killed people - that was my mistake in mid April through late May 2009, so reactionary is ok. Just don't be dogmatic one way or the other. Having large gains for the year, I see no reason to take outsized risk betting long or short at this moment - happy to tread water until the fog of war clears.

The main problem for bulls is this has been a Ponzi scheme rally of late; many people who are playing along don't believe in it for 1 moment - they are only buying because there is another sucker who will take their shares at higher prices. [Larry Levin - Fundamentals? Pshaw!] That works great on the upside - you feel confidant in buying each dip knowing someone else will bail you out. On the downside? Not so much.

But knowing when that reality hits is the trick here. When this thing reverses I expect many lemmings to attempt to run out of a very small door (cliff) at once. Trampling death by lemming is not a fun thing. If that's going to happen in the next few days, or November, or February 2010 - who knows. Just don't be the lemming - good words to live by. We're now approaching the 20 day moving average on the S&P 500... let's see if our late day miracle buying sprees hit again or if those who do the buying (allegedly) are tied up preparing for G20.

No position