For The Bulls

It seems as though there are a preponderance of readers who view me as a bear. Well, I am extremely cautious to say the least. The valuations in the market are near the highest in history and I've been a fool before. No more. Models say defensive or out and I don't ask too many questions like "Is it different this time?". People have asked that question for over two hundred years.

But, I'll be like everyone else and toot my horn a little bit. I do have the ability to be an able bull. Back on June 19th I posted a list of the only stocks I would consider buying should I have a gun pointed to my head. Below is the complete list. See a theme? BIG. VALUE. They also met a few proprietary requirements as well including a clear understanding of cycles analysis and market topping processes. Or put another way, I tend to think that I've learned to get into the mind of Wall Street and can think like they think. I don't put that cap on too much because I don't want to turn into the village idiot. A joke!

Here are the returns for those picks through year's end. I would be selling on the first day of January to maximize by tax position. ie, 16 months until I have to pay for the gains. That would be tomorrow. If I was bullish on the markets or wanted to be aggressive, I would set trailing stops on all of these stocks very tight, and see if they have more room to run. But, that wouldn't be me. At least not at this time in the economic expansion. A few actually have already reached sell signals and all are starting to lose momentum. I prefer to ask questions later.

Celgene 35%
Cigna 40% - not including dividend payments
Microsoft 32% - not including dividend payments
AT&T 28% - not including dividend payments
Verizon 16% - not including dividend payments

So, yes I am defensive or more. But, that's a healthy three year return for most broad based mutual funds. Not bad for a bear.