Week 7 Performance 2012.....LINSANITY Continues

I was getting my annual eye check up this week talking sports with the doctor and I walked out of the room and wanted to perform my own test.  I asked the lady behind the desk while she took my insurance if she had ever heard of Jeremy Lin?  Mind you the lady behind the desk was of middle age and generally speaking didn't look like she would be very interested in sports.  (For those of you that might not have heard of Jeremy Lin see this USA Today story)

The conversation went something like this;

Desk Lady - "Funny you ask I was just reading about him online"

Paul - "Would you ever make time to sit down and watch him play"

Desk Lady - "Yeah, yes I think I would it sounds like a really great story"

So what does Jeremy Lin and the stock market have in common?  It sounds like a really great story, S&P 500 up 8.3%, DOW up 6.1%, and the NASDAQ up 13.6%.  Sounds like a story that more and more people will want in on, so how high can we go?  Maybe at the top.

Just last week Barron's made a splash with it's cover story DOW 15,000 siting that the index could reach this mark within two years or less.You can certainly put a logical case together to support this thesis but all in all with everything else going on right now it just feels topy for lack of a better word.

You can't fight the FED and you can't fight the tape which is why you still need to be in the market but in my mind take a defensive approach.  Our fund still sports an almost 58% cash position.  I've actually brought that position down from north of 60% through this early year.

This week the fund was up over 1% week over week, the fifth such occurrence this year and there has only been seven trading weeks thus far in 2012.  The fund is up 13.3% which is currently beating both the DOW, S&P 500, and Russell 2000 and in line with the NASDAQ.  I sound like a broken record each week with threatening to take profits as most positions work there way higher.  This is what makes this market interesting and frustrating all at the same time knowing that the rally should pullback, things feel overdone, but yet indices continue higher.  Even names that I want to own and currently own that have run up I still have a hard time parting with knowing that this rally could continue.


Earning reports again slow this week as well as the stream of economic data.  While the markets are closed on Monday for President's Day we expect to hear additional detail of the Greek rescue on Monday which could certainly affect opening trading on Tuesday.

• Mon - Markets Closed
• Wed - Exiting Home Sales
• Thu - Kansas City Fed Mfg Index
• Fri - Consumer Sentiment, New Home Sales

So on that note I encourage everyone to remain balanced and most of all patient.  We're still not making big market bets or calls just keeping on an eye on both the fundamental and technical indicators while keeping a mindful eye on Europe and Iran which could certainly bring this rally to a screeching halt.

Have a great week.