You all can worry about whatever you want to worry about. You can follow the bulls or bears, day traders or CD holders, Wall Street pundits or the guy next door, it does not matter to me. I am looking for opportunity in the rubble.
If you are a true investor, you have a watch list -- when there is fear and negativity in the market like there has been the past few days, there will be opportunities. It is not a time to jump in with both feet, and it is not a time to speculate. It is a time to pick and choose among the companies and stocks you know well.
I would like to own more Intuitive Surgical (NASDAQ: ISRG) but it has run up so fast it has escaped my grasp, although I sense an opportunity is in the wings. I would like to own more Anglo American PLC (NYSE: AAUK) but it jumped up after recent acquisition talks in the mining industry and has not settled down yet. And it may not, but I will be patient. My regular readers know I love Huaneng Power Intl ADS (NYSE: HNP), which hardly moved today but has come down significantly in the past week, and that is very, very tempting.
Others on my watch list include:
These represent just a handful on my list, and I have written about all of them. There are many more I'm watching -- most of these are in defense, health, commodities or energy. There will be opportunities in the financial sector and housing too, but not until they come clean, and so far it seems they are only releasing information sparingly when they have no other choice.
It is not my intention to make light of a difficult market, or those of you that are getting queasy stomachs right now. I just want to make two points in closing. Both points I have made numerous times before and will again in the future.
First, if the current volatility of the market has you worried, and you fear the worst, you must adjust your portfolio until you are comfortable -- in the future do not let it get out of proportion to your level of tolerance.
The second point, and one that has allowed the most successful investors to make big money, is to buy when there is fear in the market, and only buy strong companies with solid balance sheets, that have experienced managements demonstrating a high level of integrity.
DISCLOSURE: I own shares of ACH, AAUK, GD, JNJ, HNP, ISRG, VLO (NUE I do not own.....yet)
Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm.