The island of broken toys

INVESTMENT STRATEGY: Value investing. I try to go long with stocks that are mispriced for a while but have solid fundamentals and strong potential. Like in the film «Moneyball», where general manager of Oakland Athletics Billy Beane assembled the team out of undervalued but strong players using statistical approach and won 20 game in a row, I do my best to assemble my portfolio out of several underpriced but promising companies to outperform the market in the future. That is why this wikifolio is called "The island of broken toys". PICKING CRITERIA: I generally pick 2 types of stocks for this portfolio. TYPE 1 - stocks that go through the period of reorganization, restructiring but show first signs of recovery. Turnaround episodes. TYPE 2 - gigantic companies that are temporarily down due to bad informational environment around a company. Usually these news are just too much exaggerated or shouldn't eventually effect company. Buy the dip episodes. Both types are about solid companies which have long reputation and strong fundamentals. I do not consider Financial or Basic Materials sectors. REBALANCING: I conduct rebalancing on the weekly basis using my proprietary developed Indicator of Positioning in the Short-Term Credit Cycle (or IPSCC, see my trader profile for the info.) If IPSCC goes up (higher probability of crisis) I reduce weights of risky assets (equities) and increase weights of/open new positions in safer assets (bonds ETFs, commodities ETFs and cash) or alternative assets (volatility ETFs and options ETFs). When the probability of crisis is low I load my portfolio with equities up to the maximum. The principle of dynamic tail hedging. INVESTMENT HORIZON: for TYPE 1 - 1,5 years on average for TYPE 2 - 6 months or less