A few weeks ago, 2 weeks to be precise, as I don’t write very much anymore, I did something that I had never done before.
That was to sell positions in order to raise cash.
The positions that I sold, weren’t in my usual “covered option” portfolio. They were all uncovered index funds that I had held for quite a while and had some nice long-term profits on them, as they just went along for a long market ride.
2 weeks ago on a day that the DJIA went about 144 points higher, I sold 50% of those accumulated shares.
I did so because I saw nothing to warrant the belief that we were heading even higher, at least not for a basket of stocks kind of portfolio.
Individual names, maybe. A basket? Not so much.
But, I did so with the intention of going back in with the cash to buy once again, although not all at once if the S&P 500 had retraced a mere 3% or so.
In those 2 weeks, the portfolio that held those index funds outperformed the S&P 500 by 0.5%, partly because the S&P 500 fell about 0.1% in that time period.
Yesterday, on the heels of a 130 point gain in the DJIA, I sold the remaining 50% of those index fund shares. read more