Time to Raise Some Cash

 | Apr 04, 2013 | 2:53 PM EDT  | Comments
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Stock quotes in this article:

sd

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pva

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mrh

For me, it's random thoughts day.

I've spent the last week talking at TheStreet with Jim Cramer on Sandridge (SD) and the Penn Virginia (PVA)/Magnum Hunter (MHR) deal, appearing on various networks assessing the Arkansas oil spill and watching various other numbers on jobs and Japan roll in.

With Wednesday's huge drop in oil with little besides another usually irrelevant DOE report behind it, it's OK to take a step back and try to reassess all the inputs I've looked at in the previous week and see if I can consolidate what's going on.

Here's what I see:

We've not seen a decent number to increase confidence in the recovery throughout the difficult month of March -- PMI, jobs, Europe and Cyprus -- there's been little to like, despite the general market strength.

But where has that market strength been? It hasn't been where I like to see it, in the risk assets like commodities particularly. Copper is awful, gold is bad and oil is subject to $4 drops with little reason except the obvious fact that all the traders were long as a hedge for the latest Kim Jong Un temper tantrum.  

Energy has been alternately great and only OK and you've had to choose very carefully where you're investing, finding the right E+P companies at the right share price. If you've instead just blindly bought momentum, you've been easily punished like with the refinery share drop of almost 10% in three days. 

If there was a year where it looked like the sell-in-May-and-go-away meme might be reasonable advice, this might be it.  have been looking very closely at my own portfolio and choosing where I might cut back on exposures. But this is a far easier idea for me to consider as I have been an aggressive holder of stocks since 2009 with only one moment of real concern in being in the stock market since then. This year has been, by every measure, already a better year for stock investors than many recent others and it is only human to want to protect those gains, particularly if the warmer weather is approaching and the promise of a less vigorous work schedule is calling. 

So, these are my thoughts. Do not take from this column the idea that Dicker is turning full-scale bearish and panicky. I have been trading my portfolio in the way that I think everyone should, by making small moves in allocations and sector concentrations. 

What I'm saying is that I'm going to raise some cash, maybe go from 5% to around 8-12% of holdings, pick out some stocks that have done very well and have reached further than I thought they might (refiners and some domestic E+P plays) and others that haven't performed and scale down a bit. If I post a 9% gain for the year plus dividends and not an 11% gain, that's something I can live with.

I hear the beach calling already. 

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