summary dec 31, 2009

The market ended the year with a decline. There are three popular predictions in the market: first, interest rate will go up (10 year bond will top 4.5%); Second, the market will move up (S&P 500 will top 1250); Third, crude oil will go up to 85 and beyond. I can not see these three things happen together. At least one of them has to go down for the other two to move up.

I started up my portfolio at the beginning of Nov. My objective is to minimize risk while to outperform the market in long run.

Closing value
Portfolio 1 (U$): 110436 (starting at 110000)
Portfolio 2 (C$): 80812 (starting at 80000)

Happy new year

2009 is not a bad year for the market. It clears out both extremes. The leverage on corporations are down and profits are up. But there are some new bubbles are forming. I hope Fed will start to tight early to fight hew bubbles, not inflation.

Financials in U.S have corrected quite bit. I expect a bounce soon given the wide spread of yield curve. I bought 200 BAC @15.15 today

Computer down

My computer network was down today. The market is taking a break right now. I will keep an eye on interest rate. The trade war between China and U.S is intensifying and China may buy less U.S T-bill as a warning.

Closing value
Portfolio 1 (U.S): 110502
Portfolio 2 (C$): 80766

summary dec 29, 2009

closing value
Portfolio 1 (U$): 110394
Portfolio 2 (C$): 80860

crude oil

Crude oil went up to $79 because of jittery about Iran. It probably will come down to around 75 level. i will put in an order to sell HSE @ 30.50.

The market is tired and there seems a consensus that the market will go up 10% in first quarter and have a correction in 2nd-3rd quarter and move up again in 4th quarter. I think it is silly. You should never base your investments on such a short term projections. My belief is investing based on long term fundamentals and you may realize your objectives in short term which is perfectly fine.

merry Christmas

I wish everyone a merry Christmas and happy new Year.

Closing Value
Portfolio 1 (U$) 110320
Portfolio 2 (C$) 80812

prediction for 2010 (2)

The following events may happen (50% probability), you may prepare for it.
1. Middle east tension escalates (especial Iran and Israel)
2. After 2 calm seasons, the weather may not be as calm during the hurricane season which is not good for insurance companies.
3. Chinese real estate market may start to cool down which will have a chill effect on metal consumptions.
4. The growth in BRIC countries may slower than expected.
5. A major downgrade of sovereign credit to a major country (U.K.? Japan? Russia?)