Wow–there is a rush to ‘safety’ today. Some folks think U.S. Treasuries are safety as the 10 year has plunged down to 1.58% at this moment. Others think that buying gold is safety as the yellow metal has spiked up by $19/ounce.
For me it is sit and watch mostly. It looked dangerous all week–that fake-out rebound in stocks yesterday was almost a gift and I took a modest position in Proshares SP500 UltraShort (NYSE:SDS) which is proving to add nicely to 1 account today–I have moved my stop loss 3 times today following the market down. This is something I seldom do and when I do it more often than not I am wrong and lose money.
The preferred and baby bond arena is not selling off to speak of–plenty of stuff off 1/2% to 1%, but nothing dramatic–but that could come yet later in the week. Do we get a full blown panic and a dash for the doors? No one knows, but it could happen and we all need to have a strategy mapped out–what would you buy if preferreds fall 5% or 10%? What might you sell to redeploy elsewhere? As always I can’t direct anyone to investments, but income investors need to give this some thought today and tonight. Let’s not be caught without a plan.
A good place to watch the general action in large losers is this listing here. Right now (at 12:30 CDT) it isn’t showing anything out of the ordinary–but it might later. Most losers are the usual suspects–mall reits, shippers etc, but what tomorrow brings no one knows.