My scaling out of dribs and drabs has gone off without a hitch, courtesy some remarkable macro numbers involving productivity. Just when it looked like the bonds were going to go below where they were after that Panglossian employment number, they got rescued by numbers showing more good growth with no inflation.
I still feel better having lightened up a tad. To be sure, I have scaled much more slowly in the financials than anywhere else. When people ask me what I scale back on, I do things like this: I owned 50,000 shares of
. I bought it because I thought the stock seemed good, the numbers strong and the business on plan.
But I have no edge, no particularly proprietary call, and I could use that capital if the stock market were to come down for reasons unforeseen by me.
So I sold it for a small gain and can redeploy the capital elsewhere. I did the same with some of my tech-telcos. These I just trimmed, keeping enough on for higher levels.
If the market climbs top another level, I will probably let a little more go and continue to trim from other positions. I can be less aggressive after the sales I have made as long as the bonds continue to stay strong.
No brain surgery here -- just some capital preservation. This way I can buy some favorites if they come down without having to borrow money or margin for my positions.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column by sending a letter to TheStreet.com.