I own mostly MLP stocks including a lot of WPZ. However a little over a year ago I sold $60k of ETP stock and bought my 1st tech stock in years...400 shares of AAPL at $157. I'm holding for $390...even someone as risk adverse as I am can get lucky some times. When I sell, it all goes back into MLP's and Pf stocks. Good investing
I don't think you rebalance. Here is why you can justify an overweight holding which I am also in the same position. Go look at the latest map showing $1.3B of organic growth initiatives that WPZ has on the table.
There is no other MLP except for perhaps EPD that has that level of organic growth initiatives and is able to grow the distribution nicely. ETP has huge growth initiatives but has had to freeze its distribution now going into year 3. ETP has a huge asset base including my most hated subsector (retail propane) that is growing slower than molasis thus the reason for an extended period of frozen distribution levels.
I want to see thru all of these various initiatives including how Chevron and WPZ move forward on Laurel Mountain. You know Chevron is going to push very hard to monetize those recently acquired Atlas acres.
You can overweight when you believe a particulr asset will significantly outperform the peer group. That is what I believe very much. I am also way overweight on APL and am simply holding until the distribution level has reached a leveling off point at which time I will sell down. In other words, wait until the assets have reached maximum performance value before reducing an overweight position UNLESS you have some fear that WPZ will underperform in which case my entire post is of no use to you.
Bad idea! Wpz has best three to four year potential of any MLP. Volume at Laura Mountain will go from 120 million cb ft a day in 4th qt 2010 to 1.5 billion in 2013-2014. Distribution will grow towards $4.00 in that time frame. Citi Bank has 12 month price target of $55 and a projected $3.00 distribution for 2011.