James Cullen

Q1 Market Review, Part II: Dow Industrial Components

uman,
Your comment must have come as I was typing my last replies. As I said to Roger, part of this is to get a quick cross-section of large cap equities and judge their relative attractiveness in terms of expected future returns. Another reason is to set up a baseline comparison between operating company results, and financial company results. Overall, I hope this will add context to the three questions I'm addressing - are there good businesses to invest in, do they have staying power (operationally and financially), and have investors already bid good returns up-and-away...
As for what I have, a split between the senior debt of Primus, a CDS-seller, a convertible issue from a movie theater REIT (Entertainment Properties), and a sliver of Primus equity... and about 15-20% cash. Much more focused on small/illiquid opportunities, given the dollars I'm working with relative to institutions.

Q1 Market Review, Part II: Dow Industrial Components

Roger,
Fair to an extent, but I won't agree entirely. I try to balance asset class attractiveness with bottoms-up selection, and I've put time into developing some coherent (or at least consistent) way to measure risk premiums in bonds vs. stocks. So far, this blend has worked pretty well.

Cetin,
Thanks. I don't like to lump myself into categories of optimist/pessimist, though, I try to be a realist...

Analysts See Dow Rising Sharply in 2008

The major flaw in this analysis is that it assumes all stocks will be at their price targets at the same time...