Tuesday, August 7, 2012

Holding pat, values climbing, ready for a retreat

I have great fears about Europe. I would not be surprised to see the Euro Zone go down the financial tubes --- at least, for a time. If Europe sinks, it will take us here in North America with it to a great extent. I'm mentally prepared for some paper pain, no, for a lot of paper pain.

But today the market is rising and all is right with the world. For me this means that when the next pullback occurs I may be holding a more valuable portfolio than I am holding today. For me a bear market kicks in at a ten percent loss and a damn bad pullback is something more than 20 percent.

I started my retirement with X in my portfolio and as long as I don't dip below X, I'm comfortable. Mentally, I would not feel that I have lost any money. Heck, I've taken out cash in the five digits range over the past three and half years in order to live. If I can claim to have my original investment intact, I'm not going to complain too loudly.

The higher the market climbs the more it can fall and not rock my comfort zone. At the moment my comfort zone won't be threatened until my losses pass the 30 percent point.

My recent purchases of Penn West (PWT) are adding to my comfort. I bought some shares of PWT in the $12 range and some more for my wife around $13.27. Today PWT is trading around $14.25. My AUSE is almost back into the black and my recent Cathedral Energy (CET) purchases are nicely back in the profit column. And my REM units just keep climbing. For the past few months REM has been in its top quartile. Nice.

Despite all the gloomy talk, hey, I visit the dark side frequently, there is still money to made in the market. (The TSX is up 180 points right now.) Make some money while you can. It is a great buffer against bad times.


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