Doug Kass fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he blogged on:
- How the only certainty is uncertainty.
- How Caterpillar is beginning to show signs of rolling over.
Click here for information on RealMoney, where you can see all the blogs, including Doug Kass'--and reader comments--in real time.
Originally published Feb. 2 at 3:06 p.m. EDT
"How do you weigh the risk of volatility versus the reward of profitable investment? Do you have to avoid the stock market altogether because we have a president with a different, more emphatic and less predictable style, or can you find a way to manage a portfolio despite the presidential-inspired turbulence?"
-- Jim Cramer:Reward Versus Political Risk
Jim "El Capitan" Cramer's " Reward Versus Political Risk," is an excellent essay and superb guide for the individual investor's personal account and/or retirement account.
I strongly agree with Jim's contention, that investors should never divorce themselves entirely from stocks.
As I like to write, the only certainty is the lack of certainty. And I can't remember a point in time when I wasn't long some stocks--despite how negative I might be! (Right now I am quite negative on the markets, but check out my long Best Ideas--they include stocks like Allergan(AGN) - Get Report , Radian(RDN) - Get Report , Campbell Soup(CPB) - Get Report , DuPont(DD) - Get Report , Hartford Financial(HIG) - Get Report , etc. which reside in my portfolios.)
But, I run a hedge fund (24/7) and I am trying to realize absolute returns for aggressive and wealthy investors with a shorter time frame than you should be looking at--of between six months to 18 months.
You likely have a job, and you are probably an investor on a part-time basis.
I am a full time investor/trader, a different animal than your personal account, IRA or 401(k).
I am quick on my feet and make swift decisions. I am nearly always in front of my turret and I understand the risks inherent with short selling (reward vs. risk is asymmetric!).
I have been doing this, day after day, for four decades.
And I attempt to utilize tight risk-control management to avoid mistakes when I am wrong in view.
Consider these factors and conditions when you read my Diary and Jim's thoughtful and instructive words.
Position: Long AGN, RDN, CPB large, HIG large, DD small.
Some Late Day Observations
Originally published Feb. 2 at 2:49 p.m. EDT
Metlife(MET) - Get Report is at the day's low (down $2.64) and financials may also be rolling over. ( Goldman Sachs (GS) - Get Report was much higher on the day and is now also sinking to lows of the day and is down on day now).
Technology is wobbly after Facebook(FB) - Get Report gets a Bronx cheer in Thursday's trading session. I had added to my PowerShares QQQ Trust, Series 1 ETF (QQQ) - Get Report short after the close on Wednesday and established a ProShares Trust UltraPro Short QQQ ETF (SQQQ) - Get Report long at the same time (and moved up the size considerably Thursday).
The market looks like it is having problems sustaining intra-day rallies--perhaps a departure of character.
Only retail looks like it may be bottoming.
Gold is shining, but off of the day's highs.
Position: Long: SQQQ, SDS, F, GLD large; short: SPY, QQQ, GM, GS, BAC small, C small, JPM small, CAT, Met.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long FB and AGN.