The trust's US account continues to outperform the main US indexes. The account in now about 18% in cash and has a short term aim of 25% cash until the picture clears in the US. Despite the large cash holding the trust has still been outperforming during up weeks. The main reason for this is superior stock selection based on Motley Fool recommendations combined with option trading to generate income for the account.
David Nicholls projects a weekly close below 1261 will move markets in to secular bear with a 25% drop in to 4 year low in October 06. Well 950 on S&P would be scary, if this does occur the trust will be big buyers at that point. The cash holding has been built up with this downside risk in mind. As we are still invested 80% we will profit if market continues higher.
On the positive side Stealth Stocks Dennis Slowether (sp?) and McMillan are pointing for an up year. Analysts are pointing to International stocks heading higher and US stocks lagging.
The trust is happy with their current positioning and looks to decrease holding on further rises.
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