Thursday, June 26, 2008

Testing multi-year lows

Many individual stocks (e.g. the American auto makers, banks, etc.) are testing multi-year, or even multi-decade lows. These companies in free fall are dragging down the broader averages, which are also breaking support levels. One such decliner is Citigroup (calls 1.6% of portfolio), which was downgraded today, and which makes up a small portion of my portfolio. Offsetting this type of weakness are a few modest gainers, including some of the oil drillers so far this morning. Another gainer for me was NutraCea (2.4% of portfolio), which was up nicely at the open, but which is now fading to breakeven levels. This is likely because their new venture in China has potential, but is years away (2010) and will require significant cash (i.e. even more dilution). So all investors see is: costs now, revenue much later. And most investors, including me, are tired of that. I'm just holding my position for now, though.