Editor's Note: This article was originally published at 3 p.m. EDT on Real Money on July 31. To see the latest commentary as it's published, sign up for a free trial of Real Money.
NEW YORK ( Real Money) -- It didn't take long for the questions to start after yesterday's column was published. Many people wanted to know if I am really that concerned about the market. Of course I am. If you are not, then you are not looking deeply enough. The market and the economy have some structural problems that could be disastrous. I hope that disaster never happens, but I intend to be prepared if the cracks expand.
The next question, of course, is exactly which stocks I was buying to get 35% invested in this market. I would be less than fair if I didn't answer that question, so I will highlight the stocks I would buy today with new money.
First, let's understand that this is a new-money portfolio. The fact that a stock I bought last year is not in it does not mean you should sell it. It just means it has moved up enough that I am not putting any new money in the stock. Feel free to email me with questions on any particular stocks I have suggested that are not listed here.Second, this is a domestic, non-bank portfolio invested on strict asset-based criteria. There are no longshots, foreign maximum-pessimism stocks or small banks in this portfolio, nor are there any of the Graham growth-type stocks I occasionally suggest for younger investors such as my kids. This is a classic Tim Portfolio. Also, be aware that most of these stocks are tiny, so I am only going to be able to cover those that are large enough and liquid enough to discuss here. I have talked a lot about Richardson Electronics (RELL - Get Report)and it definitely goes into a new portfolio. The stock trades right around the value of its net current assets. The company is not setting the world on fire by any stretch of the imagination, but it is profitable and pays a 2% dividend. Business is just going to slog along until we see a stronger global economy. The stock is trading at 90% of tangible book value, and the company has more than 80% of the share price in cash.