WHAT’S UP – Swine flu –  Possible pandemic or over hyped media crisis?  How to protect your portfolio and Investor411 positions:

FLUSTATUEALfredoEstrella:AFP:Getty

By Alfredo Estrella/AFP/Getty Images.

Fears of Flu

Fears of a flu pandemic are sweeping the globe., The head of the World Health Organization said the flu outbreak is a “serious situation” that has a “pandemic potential”.  Already over a half dozen countries have reported cases of Swine Flu.  All corners of the globe are being impacted by this possible pandemic. Its going to get worse before it gets better.

Most major media outlets have given issued alerts on what to do. World Heath Center has raised danger level over this disease today.  

Over Hyped? – 1/2 million people die from the flu each year.  It’s too early to tell how many people in Mexico have had the flu ,but 152 have died in Mexico. If a million people had the flu then this death rate is far less consequential. No deaths are reported in other countries.

It is also the end of flu season not the beginning (Dec.) So all this may be an overhyped media crisis.

Below under Technicals and Fundamental section of stocks is how to protect your portfolio.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

Index Percentage % Volume
Dow -0.64% down
NASDQ -0.88% down
S&P500 -1.01% down
Russell2000 -1.92% -

 

Technicals & Fundamentals

From Yesterday

“Possible FLU PANDEMIC negatively impacting markets throughout world.”

———

Major Negative Impact of FLU on Stocks

Investors411 Positions - FXI (China) and EWZ (Brazil) are going to take  a hit.

Emerging markets are far more vulnerable to a real or possible flu pandemic. Brazil already has a few people with this strain of flu. Therefore you either exit some positions of buy protection. This may be an over hyped crisis, but right now its better to be safe than sorry. Personally I’m adding some more protection.

As always – don’t make huge massive moves (all in all out) – But  both FXI and EWZ have had a great run over the last six weeks and some protection seems prudent. 

  • EEV is the Ultra Short ETF for the Emerging Markets. (2x short Emerging Markets)
  • FXP is the Ultra Short ETF for China (2x Short China)

Strongly recommend that you take profits or protect assets especially in these areas.  Longer term once these stocks hit a bottom FXI and EWZ should present a great opportunity to buy. 

Obviously related transportation, travel, and commodities (especially hogs – even though you can’t get swine flu from eating hogs) industries will take a hit and here’s an article on  companies that may benefit. From Smart Money – 10 Stocks to Watch in the  Swine Flu Crisis

Sorry  I should have been more aggressive yesterday with this warning

—————-

XLF - The ETF that tracks financials (mostly shadow banks) rose -1.62% Friday in decreased volume.  Financials have lead this rally and if they  collapse so will almost all other sectors (see Positions section of blog on XLF) 

The XFL is consolidating between @ 9.4 & 11.3. XFL closed at 10.76. We are still close to strong resistance level at @ 11.3.  This is the resistance level all Wall Street is watching.

Fed meets today.

Long Term Outlook = CAUTIOUSLY BEARISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog 

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING! 

  • Share/Save/Bookmark