selling off 2/3rd of my portfolio has looked pretty good thus far. The portfolio I sold is down almost 8% since last Monday. The stuff I kept isn't much getter (down 7.5%) but at least there is less of it. Some stocks are already getting to the point of being "ridiculous" cheap (UTA for example), I may stick my toe back in the water at the end of the week... but I still think the market has serious negative momentum and am looking for a capitulation day. Either way, I have no intent (nor the funds)to go back to where I was. I put a good chunk in the Hussman Stategic Growth fund and am saving some dollars for when they open their intl fund.
I hope all of you who have stayed the course that MFI recovers in time. All my metrics show it under performing right now... as does Steve Alexander's MagicDiligence which shows open stocks down 6.5% vs S&P 500.
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MFI small caps are getting crushed right now. Particularly foreign ones. It is hard to justify the prices on CSKI, UTA, and CEU. When they bounce, they will bounce hard.
Steve - I agree that these Chinese stocks have to be reaching bottom. I did buy some tody
I have to admit that many of these cheap companies scare me a little bit. One of the new features on VIC is a message board, and one member put it pretty succinctly when he stated:
"As an early VIC member, I have been fascinated by the progression from pure Graham and Dodd value to "speculative" investments in China. It has been amazing to observe the strong postive ratings that small company shares in a communist country with limited, if any, shareholder rights have received. Have we lost our fundamnetals? What am I missing? China is an apparent, well recognized, great macro opportunity but to look at micro-caps in a Communist country based on financial statements that have limited credibility is not value investing."
For my own personal opinion, there seems to be a higher than average incidence of shenanigans going on with Chinese small caps that makes me wary. Take UTA for instance: they have extra cash on hand, generate free cash flow, and are (apparently) trading at a significant discount to intrinsic value (if you buy all their financials), but feel the need to dilute shareholders with a $20 million equity offering. I know they want to pay for some recent acquisitions, and I'm not saying that UTA is a sham, but these odd types of occurences seem to be more frequent coming from our incredibly cheap, fast-growing friends from the other side of the world...
Marsh,
Even the "high-yield" approach open positions are underperforming the S&P right now?
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