We started 2009 @ S&P 500 @ 903.25......
Maintained exposure to equity
Canadian $ was @ 81.84 cents US for 1 CAD
We went Down to S&P 500 to 666.79 on March 6th 2009...a drop of 236.46 points or a further loss of 26.17% in a span of 2 months & 6 days...
Added 1.8% more Equity
Many claimed @ this stage that we are going Down further to Dow 2,000 / 400 in S&P 500.....
Everybody had given up hope of any rebound in markets......some of us were actually hopeful @ this juncture and were presented with a buying opportunity of a lifetime.......
My equity went down further......
Markets started to rebound against all predictions......
Pumped another 10.5% equity
By September 28th S&P 500 jumped to 1044.38 which was a jump of 377.59 points or 56.6% in 6 months & 22 days from low on March 6th.......
On Dec 24th close S&P 500 was @ 1126.48 highest close of 09.....on a YTD basis S&P 500 is UP 223.23 points or 24.71%.......
Between September & December ..I have taken out 15.59% of equity from market......by the way this equity amount taken out is 314.59 % of what I started with in 2009 .......
I am ending 2009 with an increase in equity of 708.96%...details of which is given below :
-My shorting US$ has given me a gain in equity of 128.5%
-Net increase in equity through stocks for the year is 580.46%
Gain in Equity factors Starting equity + All the money which was put in MINUS money taken out PLUS ending equity still in market......
@ year end my current portfolio size is still 15.85 TIMES what i started with or @ maximum level of the year while I have pulled substantial part of my equity.......
It is important to analyze your return in EQUITY terms because we all pumped lot of money during this year because of slumping markets initially........that needs to be factored IN.......
I keep a DAILY log of HOW my portfolio is doing in all the details........it keeps me alert to performance issues & react accordingly......
One should NEVER lose sight of the fact that EQUITY needs to GROW....and it requires CRITICAL analysis on your part...I am the biggest CRITIC of my own performance...thus keep myself very nimble & fast in trades......
SO...where we go from here in 2010......
I personally see a much more CHALLENGING year in 2010......
I see a 10% gain in S&P 500 on a YTD basis vs 24.71% for 2009......
So..... there is a CHANGE in the expectations of how markets will perform going forward on a YTD basis.......
In other words....markets will NOT lift all boats as was the case in 2009.......
It will be a difficult stock pickers market......
In 2010 you must NOT carry deadbeat stocks in your portfolio....because.... IF they did not performed in 2009 which was a very strong market...what makes you think that they are worth keeping in a difficult 2010 ????
I will have a mix of trading stocks & some conceptual stocks which I MAY try to keep longer BUT it will be performance based...means I will trade out quickly IF they do not work out...margin of error is very little in 2010.......
Here is my $/sector allocation as of Thursday's close :
TSL 30.40% Solar fully integrated
POT 18.82% AG Potash producer
AMZN 13.43% Tech/Internet online retailer
SOLF 12.00% Solar fully integrated
SLW 8.56% Silver reseller
AUY 6.53% Gold mining
IAG 5.68% Gold mining
TC 4.58% Molybdenum mining
I am overweight in Solar & Mining BUT ...still diversified in many sectors....
Good luck with your focus in improving your total equity in 2010......
BLOG does NOT give buy or sell.
PS....Had to do lot of calculations for YTD review..... thus a delay in post....
Saleem
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