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One of these years I will sell in May, or at least reduce my holdings. I think, however, we will end the year up 7-10%. Companies are still making money, interest rates are low, so I don't see where else money can go except stocks.
I remain fully invested because I don't have any better ideas for the long term. I live off my dividends so share price is of secondary importance to me.
Yes, I am glad that I followed the Sell In May strategy and reduced my equity holdings as I was about 15% overweight equities going into spring based upon my base line allocation. I am currently 20 cash, 25% income and 55% equity and with a portfolio that has better than 5% yield on amount invested. I did recently buy a small token amount in equities with the S&P 500 Index in the1290's as I felt there was good value to be had.
Currently, I have the S&P 500 Index trading back of a forward P/E Ratio of 13 as S&P estimates 2011 forward earnings for the index at $98.55. If one multiplies eatimated earnings of $98.55 times a P/E Ratio of 13 then that equates to a valuation on the Index in the low 1280's. With the Index closing today at 1265 then this puts the index back of a forward P/E Ratio of 13. From my perspective it seems, to me, that the markets have over corrected and there is good value to be had.
However, with all the forces currently working against equities better value might be had.
we did have a good day, stocks started to bounce back after down ~ 1.5% earlier in the day then that 'turkish/greek' outbreak carnage then everything went haywire we'll see what will happen tomorrow, still many icebergs outthere...
Comments
I live off my dividends so share price is of secondary importance to me.
Yes, I am glad that I followed the Sell In May strategy and reduced my equity holdings as I was about 15% overweight equities going into spring based upon my base line allocation. I am currently 20 cash, 25% income and 55% equity and with a portfolio that has better than 5% yield on amount invested. I did recently buy a small token amount in equities with the S&P 500 Index in the1290's as I felt there was good value to be had.
Currently, I have the S&P 500 Index trading back of a forward P/E Ratio of 13 as S&P estimates 2011 forward earnings for the index at $98.55. If one multiplies eatimated earnings of $98.55 times a P/E Ratio of 13 then that equates to a valuation on the Index in the low 1280's. With the Index closing today at 1265 then this puts the index back of a forward P/E Ratio of 13. From my perspective it seems, to me, that the markets have over corrected and there is good value to be had.
However, with all the forces currently working against equities better value might be had.
I am watching with cash on the sideline.
Good Investing,
Skeeter
we'll see what will happen tomorrow, still many icebergs outthere...