Your Global Stock Investor portfolio had a solid week, with most of your positions either flat or rising. Both your stock holdings — Millicom International (MICC) and Nextel Holdings (NIHD) — were up for the week, with NIHD soaring 10.8%. Look for this stock to move sharply, as NIHD announces earnings tomorrow. J.P. Morgan also initiated coverage of MICC with a price target of $52.00. As I’ve mentioned, you can expect both of these positions to soar on any improvement in market sentiment.
Your defensive holding in the CurrencyShares Japanese Yen Trust (FXY) stayed steady around the $112 mark for the entire week. Your bet against the U.S. Treasury bonds provided more excitement, when the UltraShort Lehman 20+ Treasury ProShares (TBT) soared on Monday, before correcting yesterday. Former Morgan Stanley market maven Byron Wein predicted in his annual “Ten Surprises for 2009” that 10-year U.S. Treasury Yields will climb to 4% by year-end on rising inflationary expectations. That development would send TBT soaring.
Your normally low-profile holding in the Chinese yuan through the WisdomTree Dreyfus Chinese Yuan Fund (CYB) grabbed headlines this week as the new Treasury Secretary Timothy Geithner disclosed in his confirmation hearings that “President Obama… believes that China is manipulating its currency… (and)… has pledged as President to use aggressively all the diplomatic avenues open to him to seek change in China’s currency practices.” Of course, it’s no secret that China actively manages its currency — as does Hong Kong next door and several other countries with “managed floats.” The point of giving this well-known fact such an aggressively high profile was a diplomatic faux pas.
Finally, if you’d like a humorous insight into the credit crunch — as well as a quick primer on how it all happened — watch these two clips from British comedians, Bird & Fortune. Part 1. Part 2.
Portfolio Update
The WisdomTree Dreyfus Chinese Yuan Fund (CYB) remained steady this past week despite Timothy Geithner’s amateurish diplomatic gaffe. I am keeping CYB at a HOLD.
PowerShares DB Commodity Double Short ETN (DEE) ended the week flat after enduring a sharp sell-off earlier in the week. This position acts as a hedge on global stock markets, and remains a BUY.
The CurrencyShares Japanese Yen Trust (FXY) stayed rock steady this week. This position does well when risk aversion soars. FXY is a BUY.
Millicom International (MICC) snuck back over the $40 level as some risk appetite moved back into the markets. J.P. Morgan initiated coverage of Millicom with a price target of $52.00. Although I believe this volatile stock will bounce strongly on any rally, I am keeping it at a HOLD.
Nextel Holdings (NIHD) soared 10.8% compared with last Tuesday’s close. The company will announce its 2008 year-end and fourth quarter financial results tomorrow. I am keeping NIHD at a HOLD.
UltraShort Lehman 20+ Treasury ProShares (TBT) soared early this week to an intraday high of $45.94 on Monday, before falling back yesterday. With the U.S. debt issuance at record highs, and Treasury yields still near record lows, TBT a BUY.
