Tuesday, July 13, 2010

Bookkeeping: Another Round of Profit Taking in Individual Equities

I continue to pare down risk exposure, much of which was put on some 70 S&P points ago, as we approach the make it or break it 1100 area.  Obviously if the market is off to another V shaped bounce circa early 2009 through spring 2010, we'll be underweight but in the market with no memory from day to day, or week to week the only "risk" we're taking with that is leaving some appreciation on the table.

Some sales today:

Acme Packet (APKT) became my largest position in a splurge of buying during the "puke out" session a week ago Thursday.  I took 30% off the table late last week, and sold another third (of what remains).  This batch went for a 14% gain in just over a week.  Speaking of make it or break it, the chart should tell you the very obvious reason for the sale - we're at 52 week highs, reached twice before. 

Took 40% off the Tibco Software (TIBX) position - a very similar setup to Acme Packet as it approaches 52 week highs.

Polypore International (PPO) is "thankfully" not part of the risk on, risk off HFT dominated trading and sort of dances to its own drummer (I doubt it is found in any ETFs), quite independent of the market.  What a refreshing condition.  It is up 10% from where I bought it, and was the 2nd largest long position so I sold a third to lock in that gain with at least part of the position. 

With Mercadolibre (MELI) I was a bit early to the party, hence my cost basis is too high (I bought at the 20 day moving average and obviously it fell lower), so no huge gain here - just under 4%.  But the stock is up 20% from its intraday lows during the worst of the selloff so I want to take some off the table (half of a modest position) and try to buy back lower if the general market pulls back.  This type of stock is the center of the "risk on, risk off" trade; after being pummeled during the latest selloff it is now quickly approaching its 52 week high near $62.  Bipolar action at its best.

Long all names mentioned in fund; no personal position

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