A couple months into the second quarter, I see reasons both for being optimistic and pessimistic about the market. I always find diversification between different asset classes, styles, and risk profiles comforting; but especially comforting today.
Keating Capital (KIPO), the riskiest and most ambitious Core Total Return holding, has upside potential in my opinion. This stock isn't covered extensively by the news media or analysts, and that presents an opportunity in my view. The Core Total has a limited allocation with this stock.
Meanwhile, every single holding in the Taxable Income portfolio consists of similarly unglamorous stocks. I recently sold off positions in three Eaton Vance funds: ETJ, EOS, and EOI. I saw better opportunities elsewhere.
I have most recently purchased American Select Portfolio (SLA) and Nuveen Global Income Opportunities funds (JGG) for this strategy. I have also opened additional positions in the Long Short Opportunistic and Well Intentioned Activism strategies.
On the subject of activism, I found the campaign by hedge fund activist Bulldog Investors to unlock value at Firsthand Technology Value Fund (SVVC) to be remarkable. For those interested in the details of this campaign, go here.
Among all holdings in the Activism Profile style to date, I may have had the least confidence in the prospects for SVVC.DISCLAIMER: The investments discussed are held in client accounts as of May 31, 2013. These investments may or may not be currently held in client accounts. The reader should not assume that any investments identified were or will be profitable or that any investment recommendations or investment decisions we make in the future will be profitable. Past performance is no guarantee of future results.
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