Got blindsided by a surprise superday in 2 days with a fixed income fund...feel like this is a very important question thats bound to be asked, was hoping you guys could critique my initial thoughts and/or offer potential insight...really just want to make sure im even on the right path with this one.
Thanks in advance, to be honest i dont know a whole lot about the global economy right now as an undergrad and was just looking for something that's defensible as the superday is with only senior employees who i think tend to care more about my general interest in the markets than nitty gritty finance details.
25% in private equity industry - with a lot of uncertainty about the short and longer term direction of the markets, industry offers favorable risk/return profile as a long term investment ....in a downturn, they still have the dry powder to invest in virtually any opportunity which over the long haul should result in solid profitability. in a continued bull rally, can monetize investments at favorable valuations. Also tend to offer solid 5-6% dividends which i think is greatly overlooked. also shouldered the '08 crisis relatively easily and my ultimate outlook is to proceed in this economy with caution.
15% in AS&D stocks - think what we saw with the Chinese trade war was at its core a proxy war in which the US wanted to assert itself as a global dominator...recently reported budget deficit will not drastically impact future as&d budget as I think the lower tax revenues will draw more attention as the villain in this case. Also the suppression of ISIS is a clear and sound justification for maintaining cutting edge military...just dont really see any threats other than AS&D budget.
15% in data security industry - think as major companies like facebook, equifax, etc. come under increased criticism for data privacy breaches, companies will be pressured to maintain high levels of data security as a necessary PR move. This also piggybacks off the recent trade war with China which brought privacy even further into public eye.
10-15% cash - both to serve as dry powder in case new opportunities arise and to deploy into aforementioned positions if the prices become cheaper without any fundamentals changing, emphasize importance on having conviction and confidence in poisitions unless something unanticipated changes.
I dont even know what to do with the rest...any ideas?
Yes, i fully acknowledge that i probably sound like I dont know a whole lot about what asset allocation should look like in this environment (because i don't).