Thursday, April 16, 2009

Sold PJZ and Bought Nestle Late Today/

I sold my 50 shares of the TC PJZ for $21.68 which were bought at $17.88 on 3/6/09. Buys of JWF KSA DIS and NYX/SOLD Entire Position in TFI/ Just a Day of Ignoring My Own Rules This would be a minor shift from a fixed rate coupon to a floater, having bought a GS floater in that account earlier in the day.  This asset re-positioning within the bond asset class is ongoing in anticipation of a return to an inflationary environment in a year or so.  PJZ just went ex interest and the payment for the semi-annual interest obligation was just made. I checked the price of the underlying bond which has a higher coupon than the TC.   I noticed when linking the post above that my JWF position has just about doubled in price since the purchase on 3/6.  The trader in me says sell, but I have locked in a 15% yield for the next 25 years plus another 7% annualized from the spread at my $9.15 cost.  I have already sold the 50 slightly higher cost shares to lock in a profit so JWF is a keeper just for the income it will throw off for 25 years.  Sometimes the trader animal spirit needs a good dousing of cold water.

I finished the re-deployment of the 30 grand raised by selling TFI and several short term bond positions by buying 70 shares in Nestle (NSRGY) at 33.88. This was part of my effort to create a personalized world consumer staples portfolio. I can only add more to that portfolio from cash flow due to my VIX asset allocation rule which must be satisfied to shift out of my static cash  allocation in place since 2007  back into stocks.   For the Nestle position, I would have been better off buying the entire position at once. SOLD NADX IN IRA/BOUGHT Kraft & NESTLE/ Bought Lottery Ticket in CBG at 2.39/ Drags: TALF, AXP and GE  The short term bond sales were completed just before the market took off in early March, except for the International Lease bond sales which occurred mid-month and the proceeds used to extend the stock purchases beyond the original plan.  The sales included a complete elimination of short term bond positions in Caterpillar, GE, and Hartford Financial,  and a reduction in exposure to International Lease Finance.  Of those,  the Hartford and International Lease bonds were sold primarily to raise cash for the stock investments and secondarily due to a concern about credit quality. 

The re-allocation to stocks was precipitated by a coup d'etat here at HQ by Right Brain who wanted to increase exposure to stocks when the DJIA fell to 6500, without having to dip into the headknocker's  static cash allocation and the short term bonds were the logical place to raise capital.  This was a purposeful shift out of the staid short term bond positions into stocks, which shift started in earnest on 3/3 when RB went on a two week frolic and detour barely tolerated by LB.  This is the link to some of my short term bond sales which were timed well as was the shift into stocks:

I do own shares in Google but have not had time yet to look at their earnings release which reportedly beat estimates.  MarketWatch 
Contrary to the belief of some, I have other things to do besides write this blog and research stocks and bonds. 

 LB wants to go back to the picture for the profile that shows its essence. 

  I am not a financial advisor but an individual investor trying to navigate my way through a difficult market. I have never worked for a financial institution and never will.  In these posts, I am acting as an unpaid financial journalist and an occasional political commentator.   I am also aggregating financial news stories that I view as important and providing any reader of these posts, assuming there are more than a couple, with links to those articles, sort of a filtered, somewhat intelligent, free search engine.  Any discussion made by me of particular securities  is not a recommendation to buy or to sell.  Trade at your own risk.  Consult with your financial advisor prior to making any purchase or sale. I will try to identify my sales too but it may take a few minutes after I implement them to create a post explaining my reasons.  The sale may before or after the post.  Before buying or selling any stock, even one recommended by a trusted financial advisor,  please research it and make up your own mind which is what I always try to do.  Research would include reading reports, reviewing financial records, earnings estimates, sec filings and prior earnings releases and news.  In this post, and all others by me, I am merely describing my reasons for purchasing  or selling securities, and the potential pitfalls that I identified prior to purchase or the reasons for a sale.  The securities mentioned in this and all posts written by me may not be suitable for others based on their unique financial position and risk profile.  By way of example, it is unlikely that I will ever need the funds contained in my retirement accounts. Always read the prospectus before buying a Trust Certificate, bond, preferred stock or other bond or bond like investments.  Information contained in my posts has been obtained from sources believed to be reliable but cannot be guaranteed.  It is always important to follow the investment process. the investment process/links to further information on canadian energy or royalty trustsInvestment Process Part II: Bonds and Bond Like Investments   NOT A RESEARCH SERVICE/Add of PWE Last Week   These posts by me do not constitute investment advice, nor shall they be construed as a guarantee of future results, or as an offer of any transaction in securities.   All content in these posts is provided for informational and entertainment purposes only, and it is a form of entertainment for me.

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