HOW WE ARE POSITIONED
THOSE WHO READ OUR COMMENTARY Much KNOW THAT WE HAVE BEEN CALLING FOR A Slump FOR MANY MONTHS.
We are chiefly out of stocks, with the exception of some gold, a small amount of energy, and agriculture shares. We are gate the far-flung majority of clients portfolios in cash. For those clients who are able we have stirred shares short in the past few months.
HOW WE Plot TO COPE WITH THE Panic
1. We are honing our buy brochure, we have a register of several hundred companies and industries we like worldwide and we are post price targets and entry points.
2. Monitor stocks closely to find buy points. We do not see stocks as conclusively ready to buy, but the current alarm has false them a lot cheaper and we have a large amount of cash to spend when the time is right.
3. In our opinion, knowing when to sell is just half of the task, the second half of the task is to buy when the time is right. Although we do not believe that the time is yet right, the current panic means that it is probably fairly close at hand.
LONG TERM... WE STILL LIKE THE SAME INVESTMENT THEMES. Greed has retired temporarily, and fear has taken the stage.
We plan to wait until the current market corrections end before buying the Russian, Indian, Brazilian, and Chinese stocks we have selected. All of these markets have risen in the last few years and even the greatest investments need to rest periodically before heading higher.
Many countries will enjoy very good growth during and after the recession. The current period is one of waiting and preparing to buy as the markets find their footing. Thus, we hold a large part of our portfolios in cash.
Holding cash has 3 benefits: 1. In addition to preserving assets during a decline, your psychology is better when you have not had to watch your stocks fall for months on end.
2. If new countries or industry groups lead the next bull market you have cash to buy them, and you do not have to sell the stocks of your old favorites to raise cash.
3. Cash earns interest while you wait to reinvest.
Obviously, recent events prove that human nature and the human tendency to oscillate between greed and fear is still alive. The more I watch the markets, the more I think that human emotion is as wildly out of control as ever.
MAY WE INTRODUCE SOME OF OUR STAFF DEDICATED TO SERVING OUR CLIENTS
May I take this opportunity to introduce the department heads at Guild Investment Management, Inc. We always encourage clients to feel free to contact us or any of our department heads to answer questions.
( Marketing / Client Relations ) - Aubrey Ford is assisted by the entire staff and will help existing clients and prospective clients with their new account inquiries handled in a timely manner.
( Client Accounting ) - Kyle Beard is eager to help you with your portfolio accounting and account opening related inquiries.
