401K Monthly Analysis – The Greek Vote “YES” or “OXI”

Although it is my month end 401K monthly analysis time, the word is Greece this weekend. The Greeks are going to the poll on a historic national referendum to decide whether they will say “yes” to accepting the EU austerity program for money, or whether they will say “no” (OXI in Greek) and support their leader to negotiate a better deal, assuming that is possible. I hear that there is a generation gap in the vote. The young want to say no to austerity and the Euro while the old are fearful that they will lose all that they have and are willing to give some to keep some by saying yes. I don’t envy the Greeks either ways. I hope the US will never reach that stage where we cannot manage our debt. I am afraid we too have to face some levels of austerity down the road as more and more countries are flush in debt. Borrowing cannot go on forever without having to pay the piper.

This blog site is apolitical. My focus is on blogging about trading, investing and making money. SPY is signaling down (S&P 500 ETF). Chart shown below. See the stellar returns SPY has shown over many years. Hidden in that is the gut wrenching drops that the recession created but the strength of the US economy has recovered all those losses plus more.

  https://www.spdrs.com/product/fund.seam?ticker=SPY

Given the exogenous events (as one of my Mcubed friends puts it) and that SPY is pointed down, I am out of the markets in my 401K and resting in money market funds. Markets dislike uncertainty and we have that in spades now.

In my current employer’s 401K choices, Fidelity Growth Strategies, Fidelity Div Intl and Fidelity Blue Chip Growth are the strongest funds. If one were to stay invested throughout then these would be the ones I would be in.

In my previous employer’s 401K funds, the best choices are T Rowe Price Intl Discovery, Vanguard Explorer Admiral and Fidelity Contra fund. These are the strongest. Fidelity Div Intl is also a good candidate. International funds are looking strong despite the Greek vote. Perhaps it is due to the weakening of the Euro?

My current investments are small and hedged in options trades. I own put options on the QQQ and vertical call spreads on the DIA (my wife is bullish on the DJ30 and while she is contrarian in her choices and likes to pick up dips, she is right more often than wrong). We will have to see if she is right or Cramer who says don’t buy this dip…. Me – I just want to follow the technical.