Blackstone Is Volatile but Suits Our Strategy

Oct.14.09 | About: The Blackstone (BX)

I am going to take a second round of profits out of Blackstone Group (NYSE:BX) in under a week - we had layered in new buys a week ago Friday (in the $13.40s), which were quickly capitalized on last Thursday (in the $14.80s). Now we have had another gap up on Monday's news that the company is looking to do 8 IPOs. I'm going to reduce the position by half and take it down below a 1% allocation with a sale just about at $16.

A contrarian may ask why Steve Schwarzman is so eager to dump so much equity on the market with the economy turning up roses and blue skies ahead as far as the eye can see? (ahem) But for our purposes, I am just keeping it simple - not 1 but 2 gaps in the chart as of Monday. We'll look to reacquire exposure on a nice dip, just as we did about 10 days ago. The volatility in this name suits our "core" and "trading" positions strategy perfectly. Rinse. Wash. Repeat.

*please note - pure momentum traders are buyers of this chart.... not sellers.

Long Blackstone Group in fund; no personal position