04-10-2014, 09:17 AM
(This post was last modified: 04-10-2014, 09:25 AM by hendi_alex.)
My goal is to generate maximum current income while being exposed to minimum risk, also to include the potential for at least modest growth. The risk part is the real kicker. It is hard to generate a 5%-6% yield without taking on much greater risk than would be presented by other options, a DG type of portfolio for example. Problem with the DG portfolio is the paltry average current yield which is a good bit under 3%. To mitigate risk, the majority of my portfolio is actively managed using a covered call strategy currently targeting a +10% annual cash flow return. The non covered call longer term positions are diversified across quite a few sectors including property REITs, ENERGY (which is further diversified into energy transportation, production, and midstream infrastructure, and oil services), insurance, materials. When the timing is right I'll further diversify to include some muni funds and some corporate debt. I'll also include some defensive tickers such PG, JNJ, TGT, etc. but only at strong discount to today's prices.
Here are a few of my maxims:
When to sell, when a position no longer satisfies the original criteria for purchase, or in a stable market, when paper losses exceed 10% by much of a margin. IMO holding losses to a manageable level is key to success. The market often is not rational when punishing a stock, problem is, the investor can never really know for sure whether the market is on target or not. Better to cut loose early, than to only find out the market was right, and after losses have exceeded 20% or more.
Add to winners, and gradually cull losers and under performers.
Hold to a particular strategy only so long as such seems to be working. In other words play the game that the market is willing to give at a particular time, and when the gifts from the market shifts to another direction, modify the strategy to adapt.
I blatantly steal strategies from others, but only so much as those strategies match my own objectives and comfort level.
Cash is an asset, and as such should generally have a weighting range from minimum to maximum. My cash weighting generally floats between 10% and 20%, depending upon opportunities and comfort with the market.
Long term portfolio will generally include no more than 20-30 equally weighted positions. Currently includes 15 tickers.
Here are a few of my maxims:
When to sell, when a position no longer satisfies the original criteria for purchase, or in a stable market, when paper losses exceed 10% by much of a margin. IMO holding losses to a manageable level is key to success. The market often is not rational when punishing a stock, problem is, the investor can never really know for sure whether the market is on target or not. Better to cut loose early, than to only find out the market was right, and after losses have exceeded 20% or more.
Add to winners, and gradually cull losers and under performers.
Hold to a particular strategy only so long as such seems to be working. In other words play the game that the market is willing to give at a particular time, and when the gifts from the market shifts to another direction, modify the strategy to adapt.
I blatantly steal strategies from others, but only so much as those strategies match my own objectives and comfort level.
Cash is an asset, and as such should generally have a weighting range from minimum to maximum. My cash weighting generally floats between 10% and 20%, depending upon opportunities and comfort with the market.
Long term portfolio will generally include no more than 20-30 equally weighted positions. Currently includes 15 tickers.
Alex