What happened today 8 Feb 2023, page-81

Hard to know, but it might be a fund reducing some of it’s holdings.

Over the past few months I have been reducing my holdings across all stocks because I believe that in aggregate, the market has not sufficiently priced in the likelihood of a recession, how sticky inflation is… and most importantly, how the RBA and U.S Fed will be forced to continue to take a sledgehammer to the economy and stocks until inflation is well and truly dead and buried.

Being an avid reader of many newsletters of who I believe are smart people that manage a lot of money, many of these guys are doing the same. Using every rally to reduce their holdings. On the other side of this, the data is showing that it is retail buyers who have been increasingly active and driving up a lot of stocks. The net trend is instos selling to retail. I hate to say it being a retail investor myself, but that is not good.

I myself have been raising cash, and that includes decreasing my position in PNV, because it also because the run up made the position too big relative to my overall portfolio. So I sold a stake through a few transactions, averaging around the mid 2.50s.

I had not intended to trade this, but the rapid pullback has seen me quickly buy back a portion of what I sold, while still keeping PNV within a targeted portfolio size. If it goes below $2 I’ll probably end up buying even more back.

I think the market is going to continue to be like this for awhile, very volatile. But if you’re a long term investor, you shouldn’t care too much as the company is well financed to invest and grow, and the product is not discretionary, but essential - and not just better but cheaper, so hospitals looking to save money would also have that added incentive to switch to BTM.

Despite reducing my holdings to increase my cash position, I still have a very big chunk of my portfolio in PNV.

It’s just that it was easy to justify being 130% invested when the cash rate was 1.10, but much harder when the cash rate is now 3x that and still going up.

Anyway, that’s just one opinion of one factor that might be at play.