Model Portfolio Moves: Built Ford Tough
Posted in: The Current Account
Posted by: Wayne Arnold on March 6, 2010 3:40 PM
Tags:
AIG, Apple, BMW, Boeing, bonds, Deutsche Bank, Europe, Ford Motor, Greece, insurance, model portfolio, stocks
Boom! Jumping into equities last month paid off big, with fat profits on Apple (love those iPhones!), Deutsche Bank, Ford (our cars only accelerate when you want them to) Motor, and Boeing. As a result, the model portfolio has fought back up to summer 2008 levels, while the broader market is still struggling to achieve pre-Lehman recovery. Granted, the S&P500 has kicked tail on the model in the past 12 months, but the model is outperforming so far this year.
That said, the straight reflation play seems to have, well, played
itself out. So I'm shifting out of some equities and instead beefing
back up on European bonds in a contrarian play -- I think the EU will
work the Greek problem out. Anyway, the panic in the markets over the
Greek debt crisis seems to have passed into a belief that somehow
they'll muddle through. I'm also picking up a 7-series sized chunk of
BMW and of post-bailout AIG -- someone's gotta insure the recovering US
economy and market conditions look right for the company.
This
takes the cash portion of the model down to 30 per cent, the lowest in a
long while.
