Repositioning day

Today was pretty flat, all of the major indexes finished down a little, and the overall trading range was pretty small. I took advantage of the lack of volatility to do some 'clean up' in my portfolio. I closed out a few positions that I felt had limited upside left, mostly because of big runs in the recent market upswing. I still felt they might climb a little, but I felt like most of the easy money was made, and that the risk/reward ratio was no longer near as favorable as it once was.

I closed out positions in TSRA, THQI, IGT, and FWLT. I felt all four still had some room to run, and I actually may re-open a position in IGT later, as I feel the 4-5 year horizon for it is a great one. IGT makes slot machines, and they're going to be on a replacement cycle 18-24 months out. The stock has had a really good run up though and I wanted to protect my gains. I feel the 6-9 month picture of it isn't quite as rosy. It's immediately moving to my watch list and I may look to add it back on in 2007 at some point.

THQI is a video game manufacturer. The entire video game sector has ramped really big with the debut of the Nintendo Wii and Sony Playstation 3. I fully expect THQI to have a monster 4th quarter as they make some of the best selling games for all systems, but I feel that most of the good stuff is already priced in with the recent run, and that if anything missed even slightly we could see a huge selloff. I don't really have any plans to add this name back to my portfolio anytime soon as I really only bought it as a play on the new systems and Christmas shopping season, and while those two things aren't complete, I believe most of the upside left is already priced in.

FWLT is an infrastructure stock. For a long time it was incorrectly trading along with housing, which was keeping it way down. Since September 25th though it's gone from 38 to 55, which is a rather large gain. It's P/E multiple is starting to get pretty big, and there is little growth as well as little catalyst I see to power the stock much higher in the near to mid term future. The stock may have a little more of a run in it, but my initial investment in this name was based on the fact that it had a low valuation and while it isn't exactly expensive now, it is certainly no longer cheap IMO, so I'm done with it for now. I don't forsee going back to the name anytime in the near future either.

TSRA is a technology stock that works with miniturization in semiconductors. This is another name that I had a nice gain in as it has gone from 32 to almost 39 in the last 3 months. Semiconductors as a whole haven't been on fire. I still think there could be potential upside to this name, but TSRA trades at 36 times next year's earnings. My general feeling about the market right now is that we're probably prime for a correction sometime soon, so I'm trying not to hold too many high multiple stocks right now unless they have solid, consistent growth. TSRA no longer fit that bill for me.

I also trimmed some of my shares in VDSI and GME. GME I trimmed for a lot of the same reasons I did THQI, it's a video games retailer and they've had a nice run. Also, I believe the retail sector in general is going to take a hit when the new congress passes the minimum wage increase. I still believe GME has room to run before then though, so I only pared back, I didn't close out the position completely. VDSI is actually still a position I really like, but it has expanded from a little over 8 to 12.25 pretty quickly and I felt it was prudent to go ahead and book some gains. Should it pull back I'd probably buy back my shares at a lower price. Both of these are really just some profit taking on the way up.

I added to my positions in AAPL and HLF as well today. AAPL has had several down days this week. A lot of that seems to do with the roll out of the Microsoft Zune to compete with the iPod. I believe that those worries are incorrect and that once Apple announces the iPhone (or whatever they call it, there's some issues with the naming too which has been hitting the stock) it will go to 100. Herbalife (HLF) has seen fantastic growth lately and has been benefiting a lot from international sales. This position is a bit more speculative in my portfolio, but it came down some in the early hours today to almost 40, so I added some to my position.

I also initiated two new trades, YRCW and TEVA. TEVA is a pretty short term trade while YRCW may take a while to pan out, as I believe there is a lot of room to run quickly there. I also sold a trade I had in Genentech (DNA) for a small profit today.

-Rizen