Wednesday, September 2, 2009

Bookkeeping: Selling O'Reilly Automotive (ORLY)

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Since O'Reilly Automotive (ORLY) broke below the 50 day moving average, about 4 weeks ago we've just had a placeholder position after being stopped out August 5th of the majority of our holding (at $38.39). I am unclear if the market sells off if investors will treat it as the "safety trade" like a Walmart (WMT) ... or not. My hunch is no. While not material to the portfolio I am going to sell this position [for now] as it has been unable to puncture $39 and remains stalled during a market that generally was rising up until the past handful of sessions. Normally I'd keep this "at the bottom" of the portfolio looking to add to it lower, but I have so many other stocks with outstanding limit purchase orders that if the market finally cries uncle I expect a bevy of new long positions. I don't want to suddenly wake up with 45 long positions in the portfolio.

I do like this company on a fundamental basis and an excellent management team, and will place a limit order to get a decent stake back down at $34 (200 day moving average)- current price is $37.70. This is not a 'fast money' type of stock, so $3.50 is actually quite a bit of a move for this name.

No position

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