My Investopedia Portfolio 3/29/2011 FVITF

My current holdings:

• Exelon (EXC) 500 shares at a 3.39% loss
• General Electric (GE) 1000 shares at a 17.23% gain
• Alnylam Pharmaceuticals (ALNY) 500 shares at a 41.56% loss
• People's United Financial (PBCT) 250 shares at a 13.04% loss
• Nvidia (NVDA) 1400 shares at a 71.75% gain
• Caterpillar (CAT) 200 shares at a 72.74% gain
• Union Pacific Corp. (UNP) 200 shares at a 33.89% gain
• Citigroup (C) 1000 shares at a 11.95% gain

I am selling shares in Caterpillar and Nvidia.  I still like CAT long-term, but I want to ring the register on the gain.  I wish I would have sold Nvidia when it was in the $20s, but I feel like its time to sell some of the shares.

I am going to start buying Fortuna Silver Mines (FVITF).  Go to:  www.fortunasilver.com  and check out their 2010 financial performance.  It is incredible.  I've never seen anything like it.  You will be astonished.  FVITF closed March 29th at $5.22 a share.  This investment is riskier and could be considered a gamble, especially if you consider silver prices unreasonably high. 

Japan Earthquake & Tsunami Effect

The earthquake and resulting tsunami were very unfortunate events.  You can donate funds to Japan through various organizations.  $10 from you would go a long way.

The effect on the stocks:

"Irrational Exuberance" is a book written by Professor Robert Shiller.  He is famous for creating various indexes, most importantly the Shiller P/E ratio, which has accurately calculated bottoms and tops of bubbles.  You can check out the Shiller P/E ratio charts by searching on Google.  "Irrational Exuberance" details the effects of news on the stock market.  Almost always the stock market overreacts to news. 

I believe that Japanese stocks, such as Toyota (TM), are rationally being sold off.  However, Exelon (EXC) and General Electric (GE) are being sold off unreasonably.  Exelon generates nuclear energy in the U.S. and has no affiliation with the nuclear reactors in Japan, but since it deals with nuclear energy it is being sold off.  General Electric manufactured the nuclear reactors that are leaking radiation.  There is no way that GE is responsible for the leak. These are the times in the stock market where long-mid-term value investors can cash in.  As the global sell off continues, Exelon and General Electric will continue to fall.  At one point during pre-market trading on March 15th, GE was down 7%.  I am currently trying to find ways to allocate funds towards this downturn in the market, especially toward those that were hit the hardest.

Look for stocks that are unreasonably being sold off.  Don't act impulsively, but read about why some of the stocks are falling.  Make smart decisions.  The prices of these stocks could continue to fall through the week, but eventually these stocks, especially like those of GE and Exelon, will make a run back to their prices before the disaster.

Why I Like the International Shipping Industry (NM)

Since September 2010 Navios Maritime Holdings (NM) has broken even at a 0% return.  Meanwhile, the S&P 500 has an unrealized gain of 20%.  That's quite the underperformance.

Other International Shipping Stock Returns if invested beginning of September 2010:

• Eagle Bulk Shipping (EGLE) -20%
• Genco Shipping and Trading (GNK) -22%
• Excel Maritime Carriers (EXM) -12%
• Dryships (DRYS) 18%

As you can see, the international shipping industry has suffered compared to the S&P 500.

 I think any of these companies would be worth researching, but I especially like Navios Maritime Holdings (NM).  NM has a dividend of $.06 each quarter or a 4.25% yearly dividend yield.  That's a big reason why I like NM long-term.  Even if the international shipping industry continues to not perform you still are receiving a return.  However, this does not give you downside protection.  NM could always remove their dividend or the stock price could always fall more.  If you decide to invest in NM, make sure you are staying current on NM prospects.  Keep in mind that the international shipping industry is ultra competitive, which doesn't give the shipping companies a lot of control on price.

If you buy make 4 purchase installments to protect against price fluctuations AND make sure you remain diversified after your investment.

For the data used in this article:

morningstar.com


finance.yahoo.com

Investopedia is an Excellent Source for your Investing Education

http://www.investopedia.com/university/

I have been using Investopedia for quite a while now and it has yet to disappoint.  The link above is for Investopedia University, or the tutorial section of the website.  I have gone through almost all of the tutorials and they have helped tremendously.  There is everything from some background on technical investing to how to use contrasting options to limit losses.  I suggest taking some notes on the subjects you know little about.

You can find tutorials all over the web on investing, but you need to make sure there is some  "street cred" with the authors.  Investopedia University has plenty of "street cred."