Gregor Weekly Model Portfolio Update: 21 October 2009

Gregor Macdonald
October 21st, 2009

An interesting Sao Paulo surprise this week. On Monday morning I finally grew uncomfortable enough with our Brazil exposure to let go of EWZ, the Barclays iShares Brazil ETF at an average price of 75.20 per share. As my subscribers know, our 30% gain in Brazil shares in just 6 weeks seemed too much, too fast even in a time of global asset reflation. Furthermore, I am absolutely not a technical trader. And, accordingly the goal of the model portfolio at Gregor Weekly is to establish positions and take gains on a longer timeframe. But, the USD-based chart of Brazil was simply too steep to ignore. So, to put it mildly, I was pretty surprised and felt very lucky later on Monday after the close to learn Brazil was taking measures to stem hot money inflows. This hurt Brazil shares quite alot in the afterhours session, and did further damage the following day.

Since Monday the USD Slaughterhouse theme has gone from strength to strength. This is why I devoted the proceeds of the sale of Brazil shares…(this article continues for subscribers through the membership gateway, on the right side of this page.)