Deep Breathing

I have had a crazy morning. I had to come to Phoenix today. I am still working on the paperwork to finance our new Fire Truck (I'll have a picture up when it gets delivered). I had to give an interview this morning. I have had a mountain of email to my street.com account that I still haven't had time to answer.

On top of that, I did some more trading today almost across the board. I reduced exposure to emerging markets slightly today. Some of the emerging market stuff has tripled for people that came on board when I first started. A few other things are up close to 50% in just a few months.

Similar to Statoil yesterday all I did was trim as a function of portfolio weight this is not a change in my belief in the theme. Someone who is up 100% sold more than someone who is up 50% so there was a lot of figuring to do with these trades.

For the time being this raises cash and reduces foreign exposure. In the next couple of weeks I will deploy the cash raised into more consumer and health just to restore balance.

The idea of rebalancing one a year or at some other time interval is one that comes up regularly in the media. This can be more complicated than it seems. By sticking to the calendar, a do-it-yourselfer has an easier time with the discipline required and just makes it automatic.

The down side of that idea is that the market does not care about what day of the year today is. Oil hit $75 in the middle of a quarter not the end. By the end of the quarter it may be at $60. If that happens, and I don't know that it will, waiting may not have been a great idea. Again, one driver behind reducing oil exposure, albeit slightly, was my sense that too many people were on the same side of the trade up at $75; too much portfolio weight was the other driver.

Hopefully, as with yesterday's post, this post gets you to think about what is in your portfolio and encourage you to take an unemotional inventory and rebalance if appropriate. Even if the sales I have made in the last couple of days turn out to be wrong, making proactive decisions will give you a decent shot of success.