Ask the Readers: How Are YOU Investing This Month?

by FI Fighter on December 8, 2015

in Ask the Readers

photo (7)

2015 is nearly in the books, but this time around (unlike years past), we might have a little surprise in store for us… The Fed still has one last meeting left, before we wrap up this year. The next FOMC meeting is scheduled for December 15-16. At that time, we will know for certain whether or not the economy is “healthy” enough for our first interest rate hike in nearly a decade.

Will Janet Yellen be the grinch that stole Christmas this year? Well, the latest jobs report looked good and unemployment is holding steady at 5%

Maybe we will have lift on…

In any case, I wanted to ask readers at this time — How does the possibility for a Fed rate hike this month influence your own investment decisions?

  • Nothing changes, keep on investing as usual?
  • “Buy the rumor and sell the news”?
  • Worried about tax-loss harvesting season?
  • Building up a strong cash position?
  • Do you think the USD will keep on strengthening?

As for myself, I feel as though I already have sufficient skin in the game (to the tune of over $200,000 invested in mining stocks). And with a rate hike almost certain to happen at this point, I really have no objections to hoarding more USD…

So, my own approach will most likely be:

  • Buy some mining stocks on any significant pullbacks.
  • Focus mostly on continuing to build up a strong cash position.
  • Wait for the Fed decision and subsequent market reaction.

This time around, I’m going to be more cautious (status quo + reactive) than aggressive. But who knows? Maybe the pending rate hike has already been priced in the markets…

 

We’ll find out shortly enough…

 

Lastly, I’m NOT so much a large cap investor, but any buyers here? These commodity stocks were the darlings of their respective industries not very long ago…

BHP Billiton (BBL):

BHP

Kinder Morgan (KMI):

KMI

Freeport McMoRan (FCX):

FCX

 

 

Happy Hunting!

{ 7 comments… read them below or add one }

1 Hristo December 8, 2015 at 9:46 am

Hi FIF,

My main objective right now is to build up cash position. As I am in Europe, my cash in measured in EUR which maybe is not the best case but I do not have enough confidence to speculate with currencies.

I am also in a process of selling small positions that I do not consider strategic for my portfolio. The plan is to leave one company in my portfolio in the next three to five months. I believe in that company for the long-term that is the reason I am reluctant to sell it.

Just like you, I am a fan of the mining stocks right now. However, I continue to wait at least to see whether there will be any reactor following, in my opinion, the certain interest rate increase. I have a small list of investment ideas and will follow how they will perform in the next couple of months.

Regards!

Reply

2 Mike December 8, 2015 at 9:51 am

Focusing on hoarding cash. I’ll buy on the dips, but already have enough exposure to equities through the retirement accounts.

Regarding rates, I’m guessing an interest rate hike will strengthen the dollar more so and put additional price pressure on the commodities. Did you see crude breakdown yesterday? Looks like more consolidation and layoffs coming for big oil….unless OPEC steps up.

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3 Financial Samurai December 8, 2015 at 10:15 am

Hoarding cash too! I mainly just focus on asset allocation.

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4 Tawcan December 8, 2015 at 10:41 am

Hoarding cash right now so we can deploy it to the tax-deferred accounts in 2016. I’ll continue buying equities over the next little while. May dip my toes in KMI and BBL. We’ll see.

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5 Sean December 8, 2015 at 8:26 pm

I have been buying royal Dutch shell and Pembina in the energy sector
Suncor if it drops a little would be interesting
I think pba is a great long term pipeline company, more stable than kinder Morgan
I buy colgate, nike, and J&j monthly
Glaxco looking undervalued
I cont to buy mux, exk, ag, aem, fnv in mining sector
I am looking to buy ngd, and possibly slw options if silver hits 10
Potash companies also looking interesting POT dividend 6%
In Australia I favor woodside petroleum over bhp
My view is that stocks might drop here however if they do drop 20-30% fed reserve will be forced to drop interest rates maybe negative. Liquid blue chips and pms will be places to hide out.
Cash is great but maybe over next 3-6 months, I would become increasingly nervous of cash in banks in next 1 year

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6 Tax News December 9, 2015 at 1:17 am

Timing the market means predicting the actions of millions of investors is difficult.
I have my goals, research, and plan, I’ll stick with it :). I Don’t let the desire to
make a few quick bucks in the short term distract me from my real goal:
building long-term wealth in the stock market.

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7 FI Fighter December 9, 2015 at 5:06 am

Looks like cash is king! I love it! 🙂

Better safe than sorry… And:

No cash = No opportunities!

All the best!

Reply

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