With the DJIA down almost 10% in the past few days, I'm taking this opportunity to buy some more stocks and mutual funds/ETF's. I'm currently favoring Sony (SNE) and Citigroup (C) in the individual stocks category, along with Rydex Equal Shares Index ETF (RSP) for broader exposure and Vanguard's High Dividend Yield mutual fund (VHDYX) in my Roth IRA. My total transaction value today is only about 2.5% of my investment portfolio, and that will leave about 1.5% cash remaining for future investments, unless I move more cash from non-investment accounts.
Citigroup is an interesting pick at the moment. They are down about 30% in the past month because of the economy in general and because they have high exposure to European debt which is in jeopardy of default. My feeling is that these are short term setbacks and C's long term prospects (3-5 years) are still good. I've been buying C in small lots almost since the recession began, thinking once this recession is well and truly gone C's share price will pop back up again, but so far time is making a fool of me. C is about 1.5% of my investment portfolio.
Sony is a more recent favorite. After the earthquake troubles and lawsuit troubles earlier in the year, I've been buying SNE while it's been slowly declining. The are down about 40% year-to-date, compared with only 10% for the S&P 500 index. Again, there is no reason the l can see that the long term outlook is that bad. Sony has a diverse product line up and profit losses should only be temporary as they get things going again after the earthquake.