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Investment Philosophy

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On January 16, 1999, we consolidated what had been 3 separate funds into one new stock portfolio. This move reduced our position to less than 20% in equities. Eventually, the position will be reduced to about 5%. The intent was to sell at market highs. Then, prepare for increased volatility and "rolling sector corrections". We anticipate this type of market strategy will be in place until the effects of y2k are known. Thought has been given to obtaining copies of all of our stock certificates (just in case our brokerage house experiences y2k failures).

As the turnover to cash process continues, we will be striving for three things:

  1. obtain the highest interest rate in a money market instrument (that offers the most liquidity and the best insurance)
  2. maintain a small, long term, stock portfolio by attempting to buy at the market lows
  3. accumulate a unique "real asset" portfolio by attempting to buy at the market lows

On March 1, 1999 we became more aggressive in purchasing energy stocks. Included in our portfolio are stocks, such as, ARCO, Texaco, Shell and Occidental Petroleum. Besides being natural contrarian picks, these stocks also pay a healthy dividend. For instance, Occidental Petroleum is yielding 6.72%.

Coincidentally, on March 2nd the Senate concluded that Y2K may cause more extensive trouble in poorer countries. "The year 2000 computer bug may set off civil unrest in poor countries, undermine economic growth in Asia, Latin America and Africa, and disrupt global trade in oil and other commodities"

Definitions

highest interest rate, high liquidity, best insured method to save cash - 13 week Treasury Bills

real assets - silver, gold, platinum, oil, gas, real estate

rolling sector corrections - severe declines in particular stock market areas, such as, technology or financial services

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