With investors all over the world wondering if it's safe to come out of hiding, I offer up this old Mark Twain quote: "Courage is resistance to fear, mastery of fear - not absence of fear."
I suppose that's a long way of saying make room for fear because like it or not, it's coming along for the ride. "We have to have the courage, have to have the confidence to avoid the risk-free trade that everyone has been clamoring for, the panic buying of treasuries over the past few weeks," says John Lewis of New Albany Capital Partners.
Even before the August crash, Lewis' comfort zone was in "large caps with high dividend yields and sterling balance sheets." And he's "not looking to double overnight, but rather trying not to lose half of it."
Ironically that lands two stocks, Microsoft (MSFT) and Johnson & Johnson (JNJ) -half of the entire universe of AAA-rated U.S. corporations- into his portfolio. He says the two stocks "have held up pretty well" since he touted them on Breakout back in late March. Since then, Microsoft is off less than a dollar, and J&J is actually up, while the S&P 500 is down 15%.
So with the wind at his back and hoards of uncertainty in his face, Lewis is sticking with his mega-cap picks. "Value definitely favors the large cap multi-nationals. They have tons of cash... amazing war chests," he says.
But are they cheap?Read More »from Surviving the Crisis of Confidence for Stocks