Even with the small selloff this morning stock valuations are getting extended. My trading portfolio is down to 20 stocks this morning after my dropping of SDRL, due to concern over rising interest rates. SDRL, Seadrill, has a ton of debt and their profits could be impacted by rising rates after the end of QE2. Also note that there are three stocks being traded out of the portfolio currently, FTR, WIN, and ARCC. All good stocks, but not longer fit my the criteria for the portfolio. WIN and FTR are still excellent buy and hold stocks. ARCC remains on watch as the economy again slows and their business is loaning money to small business where the slowdown will be felt first.
Many stocks in my portfolio are reaching maximum valuations to continue in the portfolio. May trading, which began this morning for my hedge fund, is causing me concern due to the increased risk of a selloff or correction in the market.
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