Q: I go into detail because this Question concerns a larger issue related to cash levels investors should allocate to Reserves. Reserve to take advantage of opportunities in volatile times. I will normally be brief when my words need no explanation , background or context.
National Oilwell Varco (NOV.us), ONE company is 8% of my portfolio. The sector represented 20% before I reduced it to 11%. NOV has lost more than half its value (and 70% of my cost). The over-allocation to NOV was the idea of a former broker . I too am at fault: I compounded the error by not rebalancing sooner. I reduced sector allocation but failed to reduce NOV. And now I try to avert my eyes when I see the loss. Problems get worse when ignored.
I arrive now at the 5i doorstep, to obtain objective comment:
In your opinion , since NOV has fallen off a cliff , does it now represent value such that one should just hold? The dividend is decent (if it is safe ; and I can't use the tax loss)
Context: Many financial commentators advise that investors keep high cash reserves during current volatility so that you’d then be in position to pick up great values when markets over-react on the downside. The advice assumes stocks will continue the recent (and rapid) descent . I had thought major markets in the US, Europe, UK and Canada had now dropped enough such that a high cash reserve was now not crucial. Several experts think otherwise: I am referring here to the opinions of successful , real-world investors. I disregard those drama queens who scream dire warnings, no matter the facts, prospects and real business conditions. I also disregard the idiocy of conmen and bullies ---the O’Leary’s of the world--- and others like the affable but hyper Jim Cramers of the Americas. I disregard the opinions of Dr Marc Faber and others whose purpose seems to be to sell expensive letters that predict the end of the world. Their performance is not unlike results you'd get from a random coin toss [CXO Advisory and other sources have documented the poor track records of many gurus..
My question about freeing up cash (by selling NOV in my case) thus arose after I thought through the concerns well reasoned and articulated by thoughtful , successful advisors.
Notwithstanding recent market corrections, the wiser commentators continue to emphasize the importance of maintaining large cash reserves to take advantage of opportunities in these volatile times if markets descend even further. Unlike the sensationalists, the thoughtful advisors make sense . I have therefore taken seriously their views on ensuring one should today keep cash reserves higher than usual
Do you think I should sell/reduce NOV to add to cash reserves ? Or do you think NOV is now excellent value and is not now the best candidate to jettison if the purpose is just to add to cash reserve?
AO:ls
Champlain NY cc Greensboro NC
National Oilwell Varco (NOV.us), ONE company is 8% of my portfolio. The sector represented 20% before I reduced it to 11%. NOV has lost more than half its value (and 70% of my cost). The over-allocation to NOV was the idea of a former broker . I too am at fault: I compounded the error by not rebalancing sooner. I reduced sector allocation but failed to reduce NOV. And now I try to avert my eyes when I see the loss. Problems get worse when ignored.
I arrive now at the 5i doorstep, to obtain objective comment:
In your opinion , since NOV has fallen off a cliff , does it now represent value such that one should just hold? The dividend is decent (if it is safe ; and I can't use the tax loss)
Context: Many financial commentators advise that investors keep high cash reserves during current volatility so that you’d then be in position to pick up great values when markets over-react on the downside. The advice assumes stocks will continue the recent (and rapid) descent . I had thought major markets in the US, Europe, UK and Canada had now dropped enough such that a high cash reserve was now not crucial. Several experts think otherwise: I am referring here to the opinions of successful , real-world investors. I disregard those drama queens who scream dire warnings, no matter the facts, prospects and real business conditions. I also disregard the idiocy of conmen and bullies ---the O’Leary’s of the world--- and others like the affable but hyper Jim Cramers of the Americas. I disregard the opinions of Dr Marc Faber and others whose purpose seems to be to sell expensive letters that predict the end of the world. Their performance is not unlike results you'd get from a random coin toss [CXO Advisory and other sources have documented the poor track records of many gurus..
My question about freeing up cash (by selling NOV in my case) thus arose after I thought through the concerns well reasoned and articulated by thoughtful , successful advisors.
Notwithstanding recent market corrections, the wiser commentators continue to emphasize the importance of maintaining large cash reserves to take advantage of opportunities in these volatile times if markets descend even further. Unlike the sensationalists, the thoughtful advisors make sense . I have therefore taken seriously their views on ensuring one should today keep cash reserves higher than usual
Do you think I should sell/reduce NOV to add to cash reserves ? Or do you think NOV is now excellent value and is not now the best candidate to jettison if the purpose is just to add to cash reserve?
AO:ls
Champlain NY cc Greensboro NC
