Saturday, August 1, 2009

Buy and Hold? Building a Portfolio

It's relatively obvious that the buy and hold strategy has not held up. Those that bought at 6400, after a rise to 14,100, have seen returns to 9000. Those that held have watched their stocks go through freefall.

In the next decade our priorities will shift. They will have to. Global economy, money, environment. The core game may be changing.

Traders still remain on top, if they are following trends well, and care little for what "should be", but only "what is".

  • Traders playing "inflation" will be watching all commodities, from Gold and Silver, to industrial, oil, and agricultural moves.
  • These traders will hold TIPS, treasury inflation protection bonds. Their principal adjusts upward along with inflation.
  • Traders playing "deflation" will be watching long term treasury bonds, very likely to surge, safe municipal bonds, and CASH.
  • And the middle grounders will play it all, of course, "allocating their portfolio" , and will include a larger % in "risk plays", such as emerging stocks, new break out plays, and small caps.
At www.bluechipoptions.com, in our preferred Blue Chip member service, we utilize the Richard D. Wyckoff Method of a 50 position "watch/own" list, and we only trade in options, or stocks, the same 50 in position, with minor changes through the year, and we typically physically hold no more than 10, and up to 20 total positions.