I bet you guys have already known well about the DUBAI news. In short, a Dubai state-owned conglomerate (Dubai World) has asked to defer some of its total debts of $59 billions loan repayments for 6 months. Unclepicks is not going to talk more about the boring story of the news(it's everywhere!), but what's the next thing to do.
Analysis
Thursday, world markets dipped, ~ -3%
Friday, europe markets recovered, some even up 1.6 %
Friday, DOW JONES closed at -1.48%, recovered from opening ~ -2.2 %
From the above data, we can expect that the markets can absorb the DUBAI news, without over aggressive correction or panic. We can expect that asian markets to follow europe's recovery during Monday open. (not for KLSE that escaped thursday's fall) :=)
Next
But but, aren't that we are expecting a major correction, yet the markets have been moving sideline for months? So, we are going to experience a major correction in coming weeks, for real?
Unclepicks might dispose half of the ytlpowr-wb, and use the cash to collect other stocks ( stocks/sectors that indirectly dip by DUBAI news).
At the same time, please keep your cash vs stocks ratio healthy. We are going sideline, or slow-downturn for the next few weeks or months.
Unclepicks currently has only 47% of stocks. Out of 47% , 21% of stocks (YTLPOWR) is defensive stock , which can be disposed easily. Ideally, 35% stocks is perfect at this time.
Warren Buffet once said, "We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful."
Collect all the way down (fearful), or up (greedy)? You can try to ask people around, majority people will tell you to stay away during downturn. Doesn't that contradict with what Warren Buffet is saying? Are you a better investor or Warren Buffet?
As usual, unclepicks will continue buying when others are fearful. Have an interesting monday :=)
