...we remain bullish into year-end, thinking the equity markets will work their way irregularly higher and are “riding” our trading/investment positions accordingly. We also remain steadfast in our belief that the U.S. dollar is bottoming, which implies we should continue to reduce our anti-dollar “bets” and rebalance (read: partially reduce) our “stuff stock” positions that have made us so much money over the last six years.
As for our international investments, hereto caution is warranted. Yet, we continue to think accounts should be buyers of weakness due to our belief that select international markets will provide outsized returns going forward. As always, we attempt to keep such investments simple by owning core investment positions in mutual funds like the MFS International Diversification Fund (MDIDX/$18.13), First Eagle Global Fund (SGENX/$51.24), Aim International Allocation Fund (AINAX/$15.09), and Oppenheimer International Diversified Fund (OIDAX/$14.64), while overlaying these core investments with ETFs (exchange traded funds) in countries we want to overweight like India, Malaysia, Vietnam, Thailand, Brazil, Mexico, Argentina, etc. Such a strategy allows us to be more proactive in our approach to the international markets (read: easier to rebalance).
As for individual stocks, we have always liked the idea of buying fundamentally sound stocks when they experience a “downside hiccup,” for various reasons, believing that such occurrences provide investors with the price “margin of Safety” often spoken of in Benjamin Graham’s book “The Intelligent Investor.”
One such stock we have “prized” over the years, but always considered pretty expensive and thus never bought, is Verifone (NYSE:PAY). Recently Verifone’s financials have been “called” into question, with an attendant 50% downside “price haircut.” We are considering it for the investment account during this year’s “tax loss” selling season.