Davy Bui's  Instablog

Davy Bui
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Since late 2006, Davy Bui has publicly posted stock picks, research reports and market commentary on his Enlightened American blog, outpacing the market by 9%, 13.5% and 17% in 2007, 2008 and 2009 respectively (http://www.enlightened-american.com/wealth/portfolio.html). Adapting a value-based... More
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The Enlightened American
  • YTD Portfolio Results & Market Commentary 0 comments
    Aug 2, 2011 2:08 AM | about stocks: CEF, AUY, PAAS, EWS, GSK, CSCO, CHK

    THE ENLIGHTENED-AMERICAN PORTFOLIO SPREADSHEET

    • Enlightened-American Portfolio: +7.2% through August 1st, 2011 (my actual IRR, including cash balance)
    • DJIA: +4.8%
    • Nasdaq: +3.5%
    • S&P 500: +2.3%
    • DJ Wilshire 5000: +2.2%
    • Russell 2000 (smallcap): +1.2%
    I must admit some pleasure at walking away from the portfolio for a month only to return to YTD results showing us outperforming all the major indices we follow. Once again, this proves the old value investing maxim that most of the time, the best move is to do nothing.

    Of course, it was entertaining to return to watch the political kabuki known as the debt ceiling crisis. One look at the markets was all it took to confirm just how toothless this "crisis" was  -- 10 year Treasury yields actually tightened last Friday below 2.8%, hardly a sign of weakening confidence in US debt even as political pundits went into hyperbolic overdrive about a deal. US stock markets' reaction today, with the Dow finishing slightly down despite news of the deal, only reinforces that politicians have been toying with Main Street's emotions even as all sides made sure to clue Wall Street in on what was truly at stake in these negotiations, which was ultimately nothing.

    I have long asserted that smart investors know the only ideology to adhere to is pragmatic flexibility. There may be a time to raise taxes, there may be a time to cut spending but in the face of an economy on the brink of a double-dip recession, that time probably is not now.

    In any case, our investments do not hinge on politicians or the Fed getting political and economic policies right (a losing proposition if ever there was one).  The portfolio's outperformance since the last update owes in large part to big gold positions -- CEF, AUY and MFN, though the latter is offset by an in-the-money call due to exercise this month. Good showings by EWS, GSK, CSCO (which we doubled down on in June) and CHK preferred D shares all bolstered YTD results while the S&P 500 lost a few basis points of return since mid-June.

    But that is all in the past and the important task at hand is how to position for the future. My answer is always the same: continue looking for good opportunities at cheap prices and let the big picture take care of itself. As always, YMMV.
    Stocks: CEF, AUY, PAAS, EWS, GSK, CSCO, CHK
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StockTalks

  • it's been my biggest loser for years now but adding to GE (GE) -- i think shares are worth $24 - $28 but stock may trade down short term.
    Nov 10, 2011
  • Extended AUY $16 calls from Oct to Jan 12 & up to $17.5 + pocketed some premium. Oct calls were badly against me a few days ago. Busy day!
    Sep 22, 2011
  • Long-awaited gold pullback. AUY covered-calls back out-of-money again. Hopefully stays that way til Nov. Like to get into ANV in low $30s
    Sep 22, 2011
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